With new up-to-date stats on its workforce, Breckenridge is refining its policy that requires certain businesses to provide workforce housing, but officials are split on how the mandate should work for small businesses. 

As mountain towns across Colorado’s High Country find themselves searching for ways to provide housing their workforces can afford, many have undertaken similar requirements. Aspen and Telluride have similar policies, but they require more from new businesses to help contribute to their affordable housing stock than Breckenridge. Other towns, such as Vail, require less than Breckenridge does. 

Breckenridge’s policy, known as 24A, requires two different types of new businesses to provide workforce housing for a certain percentage of their staff. The requirements were put in place in 2020. 

The first type of new business subject to the policy are those adding a new building or storefront to town. The other businesses subject to the policy are those moving into existing spaces that would be increasing the intensity of operations. For instance, it would apply to a cafe moving into a storefront that used to be a clothing apparel store. Breckenridge’s code considers food and beverage spots to have more “intense” operations than retail spots.

Breckenridge Town Council has long toyed with the idea of exempting small businesses from this policy, and after learning more about the implications of the requirements at a meeting on Oct. 22, the council had varying opinions on what should be done moving forward. 

The town requires these businesses to provide affordable housing for 35% of the staff it will be introducing into the workforce and uses a nuanced formula to determine what a business’s contribution should be in the community.

Because the town takes into account numerous factors when quantifying how many employees a business generates, it is often left with a number that includes a decimal. For example, a small retail space that is around 1,000 square feet in size is estimated to generate 2.4 employees.

The requirement to provide workforce housing can be met by constructing new units, purchasing existing units and placing a deed-restriction on them or paying a fee toward workforce housing in certain cases. 

Small businesses with only a few employees generally pay the fee in lieu of meeting the other requirements. An example was provided to council at the Oct. 22 meeting that demonstrated a small business that fell into the fast food/counter service category that introduced .9 employees into the workforce would be on the hook for an approximate $31,300 fee. 

Council members previously expressed worry that this would deter small businesses from coming to Breckenridge, especially given that businesses have voiced concern to the town over what they feel are hefty fees related to parking and water usage. 

Council member Todd Rankin has voiced numerous times that he fears this policy could stifle small businesses and wondered if there was a different way to go about this requirement. 

“In my personal opinion, we’re tackling it the wrong way,” he said. 

In relation to the fee-in-lieu strategy that a small business has to contribute, he said the town needs “way more dollars than this is ever going to generate” in order to provide an adequate inventory of workforce housing. 

He asked staff members if it was possible to use a measurement such as how much business a given spot is estimated to bring into town instead of basing it off employee generation. He said he was thinking about businesses adjacent to the tourism industry in particular.

Council members contemplated how spots such as Helly Hansen USA and The North Face may not introduce many new employees into the community, but, given their popularity, they arguably draw in a decent amount of revenue. They discussed how stores such as these are branches of larger corporations and have more means than a small business owner would. 

Small business owners have agreed with Rankin’s sentiment and said if they were subject to this policy it would have made bringing a new business to Breckenridge more difficult and could have deterred them from doing it. Anna Higgins opened her store Higgles Ice Cream in 2017, three years before 24A came into effect. The storefront Higgins moved into was previously a retail shope, so she was increasing the intensity of operations in the storefront by introducing food. 

Higgins said the fees related to parking and water usage were already enough of a burden, and if she had  to pay this fee it could have “put (her) out of business.”

Council members Carol Saade and Marika Page raised ideas around cutting owners a break and making one employee “free.” Meaning, if the town found a business generated 4.8 employees, the town would only require the business to provide housing for 35% of 3.8 employees instead of 4.8. This would end up exempting small businesses with one employee from the policy.

Mayor Kelly Owens asked town staff members if some sort of loan program could be put in place for small businesses. 

Assistant community development director Julia Puester said that could be tough from an administrative standpoint, but she said it could be done. 

Council member Dick Carleton said if the town provides certain business exemptions it can get “really problematic” because officials have to determine where they draw the line, case by case. 

Mayor Kelly Owens said the discussion and concerns of stifling small businesses may be a conversation to have outside the lens of the town’s 24A policy. 

Town manager Shannn Haynes agreed and said the topic could fit better into a larger conversation around economic development in Breckenridge. 

A business that recently had to comply to this policy was Breckenridge Grand Vacations, who recently received approval on a plan for a seven-parcel development that features a variety of home types and housing units and a new hotel. Breckenridge Grand Vacations provided 92 workforce housing units in this plan despite only being responsible to provide housing for 40 employees per the town’s policy.

No decisions were made at the Oct. 22 meeting.