Crested Butte council willing to adjust new housing fees

Fees in real world a bit of a shock

It appears the recently implemented Crested Butte affordable housing fees were too much in the real world and will be adjusted for commercial, public and non-profit projects. The fees will likely be decreased on the recommendation of the town Building Department and Affordable Housing Committee.

While no action was taken, the Town Council debated Monday how much of a break to give to public projects. The fees were raised exponentially this past summer in an effort to gain more deed-restricted affordable housing units in town and bolster the affordable housing unit fund.
The baseline part of the new fee equation basically implemented an $83 per square foot fee on commercial projects if developers do not provide housing units. That will likely be reduced to $63 and could significantly shrink if a project is small. The idea is to provide housing units based on the size of a project. If a commercial project is big and would end up employing a large number of people, the theory is that they’ll need a place to live, preferably in town, and thus the developer should provide the housing or fees to help provide the accommodations.
“As we began implementing it, the Building Department noticed that some of the fees were pretty significant,” Town Planner John Hess explained to the council.
A 260 square-foot expansion at an Elk Avenue business tallied $21,000 in affordable housing fees this summer. The proposed library expansion in Crested Butte would require approximately $120,000 in such fees under current regulations.
“Now let’s remember that we don’t want the fees—we want actual units,” emphasized Hess.
Mayor Leah Williams had trouble assessing significant fees on non-profit projects such as a Center for the Arts expansion. “Non-profits provide huge amenities to town,” she said. “When they expand their space they have to go to donors. Are we asking too much of our non-profits to provide these services?”
The new recommendations would give a 50 percent break to non-profits for affordable housing fees. “But does even that put building over the edge for non-profits,” Williams asked.
“The intent is meant to offset the [housing] need of new employees,” said Town Manager Susan Parker.
Under a 20,000-square-foot Center for the Arts expansion, the non-profit would have to provide 4.7 actual units. If they paid fees instead, they would owe $1.3 million.
“The fee essentially doubles if you want to pay in money instead of provide units,” said Crested Butte Building and Zoning director Bob Gillie.
“The key is getting the units built,” added Councilperson John Wirsing. “The wise investment move is to build the five units and rent them out or sell them to get your money back.”
“I look at the Center for the Arts proposal and suddenly it’s not just $3 million or $4 million but another $1.3 million for housing,” said Councilperson Jim Schmidt, “and that adds time and money down the road, and that’s tough.
“It’s definitely an impact on non-profits,” said Williams. “I see a possible benefit as well since the non-profits would need a pool of working people who live here. But in reality, I don’t know how it will play out.”
“Non-profits traditionally rely on volunteers as a big part of their plan,” said Councilperson Phoebe Wilson.
“The counterpoint is that if you don’t have affordable housing, you won’t have volunteers,” said Wirsing.
“We could eliminate fees for public buildings or make it less than half of what we will charge for commercial projects,” suggested Hess.
“Affordable housing is a real need and a real problem,” said councilperson Dan Escalante. “The fund is weak. I think we still need to charge them for it.”
“I don’t think we should charge them any affordable housing fee,” countered Schmidt. “We’re robbing Peter to pay Paul. This would slam the door shut on fundraising efforts. It’s hard enough as it is. I doubt the Arts Center would have even happened if it had faced these kinds of fees.”
Citizen David Owen said if the town exempted non-profits, the commercial property owners would feel an even bigger burden. “There are other options out there for non-profits or anyone instead of paying the fees. You could easily buy five condos in town for a lot less than $1.3 million right now and deed-restrict them.”
“We’re not asking a lot in the big picture,” said Councilperson Reed Betz.
“The community will be happy to see these fees drop,” said Williams. “Let’s look at other fee options.”
The council asked the staff to compile more figures that would give further breaks to public or non-profit projects. Overall, the council seemed ready to adjust the fees for everyone, with the bulk of the reduction going to public and non-profit construction. They will discuss the issue again at the next meeting, October 17.