Dillon officials are considering options to better incentivize homeowners in town to build accessory dwelling units on their properties, part of an ongoing effort to create more housing opportunities for members of the local workforce.

Accessory dwelling units are essentially small housing units that homeowners can construct on their properties to rent out to other community members. In Dillon, the units are allowed only on properties containing a single-family home or duplex — if the neighbor consents — and are typically connected to a freestanding or attached garage or built as an independent structure on the same property.

Town Manager Nathan Johnson said town staff has been working on new policies and options for accessory dwelling units at the Dillon Town Council’s direction since early August. He pitched the latest concept during the most recent council meeting Tuesday, Sept. 21, which would include covering the development and tap fees for single-family homeowners willing to build a deed-restricted accessory unit.

“What we came up with is that the town, through the housing 5A funds, could pay for the development fees and tap fees,” Johnson said. “So as an example, (for) a two-bedroom, two-bath (accessory dwelling unit), that could add up to about $14,000.”

The code already requires that accessory dwelling units be deed restricted to allow only long-term rentals greater than six months. During the meeting Tuesday, council members agreed that it made more sense to ax the lease-length restriction entirely in favor of simply requiring the tenant to be a member of the workforce. Once the program kicks off, the town will also allow individuals who have an existing accessory dwelling unit on their property to get reimbursed for the fees in exchange for an updated deed restriction.

The change would help to ensure that individuals coming up to work in the county in the short term — such as traveling nurses or seasonal employees — would still be eligible to rent one of the units, while simultaneously keeping away Front Range residents looking to use a property as a second home during the high seasons.

“I like the idea of putting the workforce restriction on it because it does take away the possibility that … (it’s) becoming a ski rental for someone who wants a guaranteed place to stay and come up and ski during the winter for six months,” Mayor Carolyn Skowyra said.

The Town Council was supportive of the new incentive program, though some felt the town needed to make further alterations to its accessory dwelling unit regulations so that they’re more enticing.

The current code restricts accessory dwelling units within single-family homes to roughly one-third the size of the primary unit, and freestanding accessory units are restricted to 600 square feet and must be built on a permanent foundation. Council member Steve Milroy suggested that loosening some of the codes could create better situations for would-be builders so they wouldn’t have to charge exorbitant rent prices to recoup construction costs.

“I’ve had some feedback from community members that they haven’t considered (accessory dwelling units) because there’s too much restriction on the size of the unit,” Milroy said. “A lot of the houses here aren’t big, so … it doesn’t give you much of an (accessory dwelling unit) and it becomes only a one bedroom. The cost of building that far exceeds what you can expect to get back in terms of renting to workforce. But if we increased that limit a little, then people could double the footprint of the (unit), and they could recover more of the costs of building it.”

Council member Karen Kaminski warned against loosening the restriction excessively, voicing that increasing density too much could begin to impact the culture and quality of life in residential neighborhoods.

It’s unclear if the town will seriously consider any additional code changes outside of the updated deed restrictions and fee requirements, which still need to be formally approved by the Town Council via ordinance in an upcoming meeting.

It’s also unclear how the town will go about enforcing the deed restrictions to ensure homeowners using the incentives are renting to members of the workforce exclusively.

Skowyra said she’s looking for swift punishments for anyone caught trying to circumvent the restrictions.

“If you’re found in violation … I think it’s immediately you now owe us $14,000 back because you didn’t play by the rules,” Skowyra said.