County reconsiders inclusionary zoning for housing dilemma

Legislation may be ready by early 2008

After making essential  affordable housing a priority two years ago, the Gunnison County commissioners seem poised to put inclusionary housing requirements for new devolpment on the books.

At a Tuesday, December 11 work session, the commissioners took input from county housing and planning officials, the county inclusionary housing taskforce and the public to help craft new county affordable housing regulations.
To kick off the meeting, Gunnison County Housing Authority executive director Denise Wise presented a synopsis of the inclusionary housing taskforce’s efforts. The taskforce, comprised of County Planning Commissioner David Owen, City of Gunnison Councilor Ellen Harriman, Mike Dawson, Alison Gannet, Mike Potoker and Jeffrey Walker, has been meeting since June.
Using 2005 Planning Commission recommendations as a starting point, Wise said the housing task force tackled the most difficult and controversial issues facing the proposed program.
“The biggest one was the ‘set-aside’ requirement,” she said. The set-aside requirement is the actual percentage of inclusionary affordable housing units the developers would have to provide with every new development.
“That component dominated about 55 percent of the conversation and discussion,” Wise continued, “and the balance of the discussion was about density.”
Wise noted that in 2005, county planning commissioners had suggested a 30 percent set-aside requirement.
However, commissioner Jim Starr said before discussing the set-aside percentage, the commission should consider some of the incentives available to developers to make the regulations more palatable.
Starr said in other jurisdictions where such programs were implemented, the affordable housing units constructed tended to be revenue-neutral for the developers.
“They don’t make money, but it doesn’t drive them into the ground, either,” he said.
Commission chairman Hap Channell asked if there should be a general inclusionary requirement on new development from which incentives would emanate.
Commissioner Paula Swenson said there had to be a baseline in order for there to be incentives. “The incentives are to entice the developer to do more than the requirements,” she said.
Housing taskforce member Mike Potoker said if there was a minimum baseline without any enticements, it would have to be set low.
“If you ended up at 30 percent and you don’t get anything back for that, then I don’t know if that’s going to fly,” he said.
Channell said he liked Potoker’s idea of setting a low baseline and then offering incentives to the developers to generate more affordable units.
“If we consider a higher set-aside requirement, we need to build in some incentives at that baseline level in order to give the developer more of an ability to do the project,” he said.
Starr said he wanted to discuss the particulars of the incentives. “I’d like to know what’s in the tool box,” he said.
Resident Mindy Costanzo asked whether there was still a need for affordable housing requirements due to the recent flattening of the local housing market.
“There are over 50 ads for rentals in the Shopper this week,” she said. “Before you start your legislation, you have to look at the data,” she added.
But Planning Commission member Richard Karas countered that the county had almost full employment, and he said a recent study generated by the “Gunnison Rising” development proponents indicated that affordable housing was still an issue in Gunnison County.
“None of this supports the notion that there is no need for affordable housing,” he said.
County Planning Commission member Nick Lypps said after years of talking about an affordable housing requirement in the county, the time was nigh to take action.
“Let’s just get on with it,” he said. “I don’t care whether (the set-aside) is 10 percent, 15 percent or 20 percent. Let’s just get on with it. We can evaluate it and fine-tune it as we go along,” he added.
The discussion then turned to the question of density, because added density is the most potent incentive for developers to build affordable housing.
One problem with increasing density, according to Wise, is that in many cases density allocations were already set by the county Land Use Resolution (LUR). And because LUR rules define land use compatibility for new subdivisions as “substantially similar” to any neighboring development, Wise said there could be conflicts.
“The person who owns the abutting 35-acre parcel may say ‘That’s not what I signed up for,’” Wise said.
Potoker said county rules would have to be amended.
“You will have to change the LUR,” he said. “And I don’t think it’s that hard,” he added.
“It’s not that easy, either,” Potoker allowed, after a pause.
Housing task force member Mike Dawson said because density beyond the state-vested right of one unit per 35-acre parcel was determined on a case-by-case basis by the Planning Commission and the county commissioners, an actual density bonus was hard to pin down.
“Unless you make some hard decisions about the density and draw some lines on a map, the density bonus is elusive—it doesn’t exist,” he said.
County manager Matthew Birnie said density could be allocated through a point system, in which certain factors like a central sewer system and proximity to transportation links would be weighted to justify added density.
After all the commissioners agreed it was a fruitful meeting, Channell polled his colleagues about what the baseline set-aside requirement should be.
Starr said he favored a 20 percent set-aside baseline, with a portion dedicated to a less stringent deed restriction that would encourage professionals like doctors and lawyers to establish roots in the community.
Swenson said she favored a 10 percent set aside because she wanted a realistic number that could be tweaked in the future.
Channell split the difference, arguing for a 15 percent set-aside requirement and keeping the new regulations as streamlined as possible.
“I don’t know if it’s possible to ‘keep it simple, stupid,’ but I do think we can ‘keep it simpler, stupid,’” he said.
With that, Channell asked staff to flesh out the particulars and come back with recommendations that refined the conclusions drawn in the meeting. Channell asked staff to prepare the recommendation for another meeting on the issue for the first part of January.