City Council to tackle housing policy and fees
A question before Glenwood Springs City Council about reducing development impact fees to help create more attainable housing types is turning into a broader discussion about the city’s housing policies.
Council is slated for a work session before Thursday’s regular council meeting to further weigh a recommendation to adopt a new fee structure for water and sewer system improvements.
The public will then have a chance to comment during the regular session beginning at 6 p.m., and council is expected to give some sort of policy direction on the matter.
A recent analysis of the improvements fees by the engineering firm SGM determined that water fees could be reduced slightly, but that sewer fees should nearly double in order to keep up with costs associated with maintaining the city’s wastewater infrastructure.
A similar analysis was also done recently related to impact fees charged to residential developers for fire protection services. It, too, determined that if the city is to consider fire department upgrades in future years those fees may need to be adjusted upward.
Countering the recommendations, however, is a growing opinion among developers and some council members that, if the city is to attract housing that’s more attainable for working-class residents, some sort of break in development fees is necessary.
The developer of the already-approved 88-unit Lofts at Red Mountain project at Glenwood Meadows has even proposed that any project in the city creating five or more smaller rental units be given a 60 percent fee reduction in an effort to spur more development of those types of units.
Land-use attorney Chad Lee of the Balcomb & Green law firm also chimed in with regards to the questions currently before City Council, arguing that the fee recommendations are out of line.
“Glenwood cannot afford stagnation,” Lee wrote in a letter to council last month. “Despite a pent-up demand for new housing that has only increased over the past seven years, Glenwood has been hesitant to approve new housing projects and, as a result, has been the slowest growing municipality in eastern Garfield County — slower than Carbondale, New Castle, Silt and Rifle.”
Lee added in a March 10 letter to council members that “impact fees greatly impact residential development in Glenwood.”
“Thus, the city discussion of impact fees is also a discussion of Glenwood’s future housing inventory,” he wrote. “… Reducing impact fees to a reasonable and manageable level is an appropriate incentive to facilitate the development of attainable housing, which the city lacks.”
Impact fees, or system improvement fees as they’re more formally referred to, are typically assessed on a proposed development project “to pay for all or a portion of the costs of providing public utilities to the new development,” according to an overview of the issue provided by city staff for the Thursday meeting.
“These fees are usually implemented to help reduce the economic burden on the local utility rate payers within the city while trying to deal with population growth within the city,” the staff memo explains.
If SGM’s recommendations are adopted, “Staff believes the methodology and conclusions are valid and would pass any challenges brought forward.”
But some council members have said they would be willing to waive some fees in an effort to encourage more middle-income housing in the community, particularly when it comes to rental units.
When the question came up at a previous work session on Feb. 11, however, other council members objected, saying fees shouldn’t be waived without some guarantee that the units would remain affordable over time.
“Council has stated in several prior work sessions a goal of ‘attainable housing,’ defined generally as housing that is not made affordable through inclusionary zoning, rent controls, deed restrictions and the like, but rather by its (smaller) size and type is an attainable purchase by a larger segment of the market,” staff notes in its memo.
Also included in the packet for the Thursday discussion is the city’s inclusionary zoning ordinance, which requires 15 percent of all new for-sale housing to carry deed restrictions such as appreciation caps and resident-owner requirements and be priced for certain income categories.
However, those requirements have been suspended since 2011 in an effort by past city councils to try to spur more free-market housing development in the city following the 2008 recession. New development has still lagged even as the economy has improved.
If a fee reduction is to be implemented, “Council should consider what the overall purpose of the fee is an how fees affect potential developments,” staff concludes in its overview of the issue.
“If there is a goal to incentivize a particular segment of development, there are probably several methods to accomplish that goal without negatively affecting the overall ability of the utility enterprise to meet its obligation to rate payers,” staff also states in the memo.
The Thursday work session is slated for two hours beginning at 4 p.m. at City Hall, 101 W. Eighth St.
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