April 6, 2019
Boulder will aim for 15% affordable housing by 2035, with eyes on a higher target in the future, after city council debated the matter Tuesday. But when it came to a plan for how to raise the roughly $225 million extra the city will need to build or preserve homes, elected officials were less committed. A proposed property tax, which would be put forward by the county, drew direct opposition from some members and tepid support, at best, from others.
To make 15% of Boulder County’s housing stock affordable by 2035, the city will need to build or preserve 4,008 dwellings by 2035. To date, there are 3,484 affordable units in Boulder, created over 19 years when Boulder first established its goal of 10% affordable homes citywide. There are also 110 deed-restricted middle-income homes, of the 1,000 Boulder hopes to have by 2030.
Adding or preserving that many homes will cost an estimated $15 million extra each year, according to city staff.
The Boulder County Regional Housing Partnership is recommending increasing property taxes to raise roughly $20 million annually countywide. Voters would have to approve the hike via a ballot measure, which Boulder County may push in November’s election. It would add around $100 annually to the property tax for a $500,000 condo; $180 per year for a single-family home worth $900,000.
Much of council thought November might be too soon for such a measure. In preliminary polling, a narrow majority (55%) of 600 survey respondents said they would support a property tax.
“I don’t think it’s going to be an easy sell in Boulder,” said councilman Sam Weaver, who was opposed to a 2019 ballot item. “If it goes down, we’re done. For a long time.”
Others, including Mayor Suzanne Jones, councilwoman Mary Young and councilman Aaron Brockett, were open to the idea of fall vote. Councilwoman Cindy Carlisle, meanwhile, said she wouldn’t support a property tax no matter when it was brought forward.
“It wouldn’t be equitably distributed across the tax base,” Carlisle said. “I see it as inequitable for the people and businesses who have been living and working here who are trying to maintain as things are going up astronomically.”
Property taxes increased 37.5% in the most recent assessment. Approximately 24% of homeowners in Boulder pay more than 30% of their income toward their mortgage, according to census data. However, 61% of renters do.
Political group PLAN Boulder, while it did not explicitly oppose the property tax, believes council should instead focus on acquiring homes and apartment buildings to preserve as affordable housing, as well as a recently proposed down payment assistance program. The city should also step up enforcement of short-term rentals and “work with” CU to “cap enrollment and house substantially more students on campus,” member Adam Swetlik said, reading from a prepared statement.
PLAN endorsed the 15% goal. Swetlik, who also sits on the Housing Advisory Board, noted that, as a member of that group, he personally supported a higher target of 20%.
Of the handful of people who spoke at Tuesday’s public hearing, only one — Evan Freirich — urged council to adopt a 20% goal and to pursue higher property taxes to fund it.
“As a property owner, I have been personally enriched enormously” by rising property values, Freirich said. “I can’t say that (of) those wage earners who spend money in stores” and would therefore be burdened by higher sales tax, another proposal put forward.
Boulder needs to set an example to the rest of the county, he said. A goal of 12% — as has been suggested by the regional partnership — “isn’t enough. We need to step it up.”
Each municipality in Boulder County will, in turn, debate the 12% goal and the proposed property tax. Longmont took a look on Tuesday night, but city council and two members of the public were loath to support either.
Speaking before Boulder’s council on Tuesday, Chamber President John Tayer said higher property taxes would further burden businesses already struggling under rising costs. Because of Colorado’s Gallagher Amendment, commercial property owners pay a greater share of property taxes than do residential owners.
Tayer instead asked that elected officials pursue policies that would encourage the development of “more moderate-size homes” along transit corridors, something HAB suggested in its report to council.
“We ask you to work first on these no-cost solutions,” Tayer said.
Aside from a brief mention from Brockett that the discussion should include “policies as well as taxes,” council did not debate at all any regulatory changes as a means of increasing affordable housing.
Councilwoman Lisa Morzel proposed a fee on demolitions, “most” of which, she said, “are completely ridiculous.” The idea of a tax on second or luxury homes was floated as well, and drew support across members, except for Carlisle, who questioned the legality.
City Attorney Tom Carr said that, while there are some restrictions in state law, a workaround could possible be found. Summit County, he noted, has adopted a second-home tax.
Even if the property tax were to pass in Boulder County, the expected $20 million in annual revenue would not to go Boulder alone. The regional partnership is proposing that 75% of monies collected be distributed to cities based on population; the remaining quarter would fund three countywide programs: down payment assistance, homebuyer counseling and home rehabilitation.
Boulder’s council members felt that fewer dollars should be directed to the programs and more to cities. They also thought that the distribution should be based on the value of property, not population, which would increase Boulder’s share substantially from the roughly $3.5-$4 million it would get under the current proposal.
While Mayor Jones saw the value of a regional approach, others did not. It makes more sense to build homes in Longmont than Boulder, Jones said, because the cost is much less.
“We’re going to spend a lot more money to solve it here,” she said.
Councilman Weaver rejoined that it doesn’t make sense to build housing in a place that doesn’t reduce in-commuting to Boulder. “Regional transit!” Jones replied. But those in opposition stood firm.
Boulder has to get “a complete fair share” of the funds, Morzel said. “Or else I’d rather do it on my own. Just do a city of Boulder tax.”
Wherever the cash ends up coming from, housing staff, in a presentation to council, said money alone won’t solve Boulder’s housing crisis. Financial resources were but one of four strategies needed to meet the city’s goals, including a consideration of regulatory policies to “ensure (that) regulations and processes facilitate and not impeded (sic) housing creation.”
“To reach anything beyond the 10% goal,” said Kristin Hyser, deputy director of housing and human services, “it cannot be business as usual.”
To view a Twitter thread of Tuesday night’s discussion, visit threadreaderapp.com/thread/1113247674902372352.html
— Shay Castle, email@example.com, @shayshinecastle
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