Calling the need for more affordable housing a statewide concern, Gov. Jared Polis last week signed an executive order to withhold funding from cities and counties that don’t comply with a suite of new Colorado housing laws.

Polis, in his order, said that despite “many communities pursuing local actions,” the state is short of more than 100,000 housing units. “As such, these regional and statewide actions are critical and our success requires that all local governments comply with state law.”

Six Front Range cities are now suing the governor and the state over the new laws.

The effort is a major escalation in the ongoing tug of war between the state and local governments over how to handle housing policy. Yet in mountain resort communities, where average home costs are among the highest in the state, Polis’ order likely won’t have much effect.

Much of the major housing legislation passed at the statehouse last year, including efforts to boost density, exempts mountain towns. Instead, those laws focus on populous Front Range cities. 

The measures include incentivizing denser housing development near transit lines, eliminating minimum parking requirements for housing built near transit hubs, and allowing homeowners to have accessory dwelling units. The legislature also passed a law this year allowing smaller apartment complexes to be built with a single staircase, but only in cities with more than 100,000 residents. 

Rural resort areas were included in some housing legislation, like a requirement for local governments to submit reports to the state on their housing needs and a ban on residential occupancy limits. A law passed this legislative session creating regional building codes for factory-built homes that supersede local codes will also affect mountain areas. 

Communities that don’t follow those laws could be at risk of losing state funding for local transportation and energy projects under the governor’s executive order. 

Polis spokesperson Shelby Weiman said in a statement that the order does not change the laws or where they apply, adding, “Our mountain communities are a critical part of our housing needs, and we look forward to continuing work with those communities to ensure we have affordable workforce housing options in every part of Colorado.”

Margaret Bowes, executive director for the Colorado Association of Ski Towns, said the group is “pleased” to have not been included in the bulk of the housing legislation and, by extension, the majority of the executive order. 

Local leaders have argued that many of the state’s proposals would be difficult to implement in mountain towns, citing myriad challenges like a lack of buildable land, parking pressures, and vastly different real estate markets. 

“We have just always contended that a single, statewide policy won’t work. That different regions of Colorado are unique enough that they need unique solutions,” Bowes said. 

Bowes’ group represents nearly 30 mountain communities, including Aspen, Glenwood Springs, Steamboat Springs, Breckenridge and Vail. Of the few housing laws that do apply to those areas, Bowes said local governments are generally supportive of the measures. She doesn’t foresee them being at risk of losing state funding. 

Many ski towns are already doing the work the state would like to see, including allowing ADUs and building workforce housing near transit, Bowes said. The ski town association also supported the bill on housing needs assessments and was receptive to this year’s effort to streamline the development of factory-built homes. 

Previous land-use battles led to exemptions for mountain towns 

Where mountain town leaders have pushed back, however, has been when the state wades into local land-use decisions. Polis and the legislature first attempted to override local zoning rules in 2023, with a sweeping bill that would’ve pushed municipalities to build higher-density housing under a statewide land-use mandate. 

The measure failed amid broad opposition from local governments, including on the Western Slope. Lawmakers managed to approve a slimmed-down version of the legislation last year, passing bills in chunks that targeted density and parking requirements along transit corridors. 

Western Slope communities, apart from Grand Junction, were left out of the requirements entirely after arguing that increasing housing density alone wouldn’t bring down costs in rural resort towns. 

“Some of the bills in previous sessions seemed to indicate that building more housing would bring down the cost of said housing, and that argument just doesn’t hold in resort areas,” Bowes said. “More housing without any affordability provisions will just result in more investment properties, short-term rentals and second homes.” 

State Sen. Dylan Roberts, a Frisco Democrat, was a leading voice for that argument in the legislature and opposed density mandates for mountain towns during 2023’s land-use debate, though he did support last year’s housing package targeting Front Range communities. 

Roberts said it’s possible ski towns could opt into some of those policies, such as the ADU expansion, which would unlock more funding from the state. 

“Rural resort areas have been leaders in affordable housing policies for a long time, well before the state legislature and Gov. Polis made it a priority,” Roberts said. “They are welcome of any resource that can help them bolster their existing efforts in that area.”

Roberts said his focus has been on passing legislation that empowers mountain communities to pursue strategies that work best for their area. Examples include a bill this year that raised the lodging tax cap for counties from 2% to 6% to fund workforce housing projects and another measure that allocates up to $50 million in low-interest state bonds to developers of income-based homes. 

Bowes said ski towns would continue to push for legislation next year to help generate revenue for affordable housing. The group proposed a bill for this session to allow municipalities to vote on and approve taxes on vacant homes, for example, but that measure never came forward. 

“We can make a lot more impact with solutions that are addressing our unique situations and challenges in mountain resort areas,” Bowes said.