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Glenwood brings inclusionary housing fees up-to-date

John Gardner
Post Independent Staff
Glenwood Springs, CO Colorado

GLENWOOD SPRINGS, Colorado – The Glenwood Springs Housing Commission recently adjusted the way it calculates its fee in-lieu assessment for fractional units required under the city’s inclusionary housing ordinance and the city’s community housing guidelines.

City Council approved the adjustment at the Sept. 17 meeting as part of the consent agenda.

The recommendation from the housing commission was to gradually increase the base fee over the next four years to “catch up” with the gap between market rate housing and affordable housing, according to City Planner Jill Peterson.



Peterson said that the fee had not been increased since 2003, despite having been recommended by the housing commission in 2006.

However, Peterson wrote in a memo to city council that “the fee amount needs to be adjusted on an annual basis to reflect the true gap between affordable sales prices and market sales prices.”



The Community Housing Program requires new residential developments to provide at least 15 percent affordable housing within the development, or are required to pay a fee in-lieu of providing the affordable housing option. The idea is to provide more affordable housing for people who live and work in the area.

Developments of six units or less, or developments which result in a fraction of a unit, shall either pay a fee in-lieu equal to the fraction of the required unit or add an additional unit.

For example, a five-unit development would be required to put aside 15 percent or 0.75 of one unit to be included as affordable housing. A fee in-lieu of 75 percent of the total fee in-lieu assessment for one full unit would be required by the developer.

All fees are paid to the City of Glenwood Springs Community Development Department prior to issuance of the agreement which vests rights for the subdivision or development.

The fees are placed into a separate fund that is earmarked for the acquisition of land or units, or for the development of community housing.

By not adjusting the fee each year, the “gap” has increased a substantial amount, Peterson said.

For example, the 2009 fee in-lieu payment was $18,579 per unit. But as adjusted by the housing commission, the fee should be $126,271.

However, the housing commission and city council decided instead to revisit the issue next spring to get a more accurate “gap”. The gap will be covered over a four year period – and not all at once – in light of the current economic and housing market situations, according to Peterson.

“The housing commission thought that it would be a pretty big pill for the development community to swallow at this point,” Peterson said.

Instead, the fee will increase to $31,568 per unit, which is 25 percent of the total base fee of $126,271.

Council will revisit the issue in the spring of 2010 when the actual U.S. Housing and Urban Development (HUD) 2009 sales are published.

The fee is scheduled to increase to 50 percent of the calculated base amount for 2010, by 75 percent in 2011, and will be 100 percent by 2012, according to Peterson.

jgardner@postindependent.com


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