Affordable rental project will cost town major bucks

Sixth and Belleview…3 stories, 30 units, parking, dogs and bikes

The developers of the proposed affordable housing rental project at Sixth and Belleview outlined the idea at a Crested Butte town council work session on Tuesday, September 3 and asked the council for $65,000 in preliminary funding. They reassured the council that the project at the entrance to town would be a good looking, quality project that would serve a demographic in need of affordable housing in Crested Butte.

“Just because it will be a big building for low income rentals doesn’t mean it can’t look great, have high quality construction and include things like high efficiency energy systems,” developer Bill Coburn told the council. “We’ve heard concerns voiced about having such a project at that location. But the building is pretty far back from Sixth. There is more than 7,000 feet of B-2 commercial space left for business structures along Sixth Street.”
Coburn reiterated that the site was favorable given the building size that would likely be in the 21,000 square foot range. The three-story building would accommodate 24 one-bedroom apartments and six two-bedroom units. “True Value, Clarks Market and the Center for the Arts are nearby. It’s right on the transit route. It’s about the only place we could do a building like this in town,” he said.
When asked by councilperson Jim Schmidt why the proponents didn’t use town-owned land set aside for affordable housing projects, Gunnison Valley Regional Housing Authority Executive Director Karl Fulmer explained that a key to the project was obtaining tax credits.
“That is a very competitive process,” he said. “We hope to get close to $3.7 million in tax credits. There are certain criteria the awarding agency looks for. The proximity to schools, public transit and groceries all count. This site wills score very high in that regard. Plus they want to see a project that’s ready to go and there isn’t infrastructure over there yet.”
“This building would be odd over in Paradise Park because of its size,” added Coburn.
“One thing I like is that it takes non-deed restricted lots for affordable housing and preserves deed restricted lots for the future,” said mayor Aaron Huckstep.
Coburn said no real design details have been planned but on initial “test-fit” sketches, it seems that the building fits but would be short some required parking. Thirty-eight parking spots could be drawn into the plan on the site instead of the currently required 44. Some zoning revisions would also have to be made by the town since the proposed facility sits on five T-zone and parts of five B-2 commercial lots.
Coburn said there are still plenty of other things to work out on the proposal such as snow storage, setbacks and storage for things like bikes and kayaks. But he wants to enter the Board of Zoning and Architectural Review (BOZAR) process next month and begin the series of meetings needed to accommodate the process. With an aggressive approach, he would expect to see town approval in early 2014. The submission deadline to obtain tax credits is March 3 for the first of two opportunities next year.
Coburn and Fulmer said dogs would be allowed but they would be permitted with restrictions included in good lease agreements and overseen by good management. They hope to build the project to LEED (Leadership in Energy and Environmental Design) standards but probably not pay the $20,000 to $30,000 to get the official LEED plaque.
Fulmer said the project is geared to those making 60-percent or less of the median income in the county. For a single person, that is about $28,900. If they started making more, they might be asked to move out of the cheap accommodations. “It is meant as a starter project,” Fulmer said. “There is a real need for housing those in that income level so once a person starts making more money, hopefully they’ll be able to move on to something else.”
Responding to a concern voiced by councilperson Glenn Michel, he said that the rental units wouldn’t be expected to compete with current rentals on the free market. “Because of the pricing it won’t compete directly with free market units. It might draw some people away but I just don’t see these directly competing,” he said. “The demand is so high the free market shouldn’t see a ding. We’re estimating there is six times the demand of the supply we are building.”
Fulmer admitted it would not be cheap to start the process. In fact, he estimated about $200,000 would be needed for predevelopment costs. He asked the town of Crested Butte to pony up $65,000 of that. The council will discuss the request at its next meeting.
Other partners in the project with the Housing Authority would be Housing Resources of Western Colorado out of Grand Junction that has experience in the tax credit arena. Snavely Group out of Cleveland is consulting on the project and first originated the idea and pursued the property site. Each of those three entities would be expected to garner at least $200,000 from the project. Coburn would design and be the general contractor on the project.
Fulmer made it clear that if the idea was rejected for the tax credits, the town would likely not get back any of the original $65,000. He admitted that just one in four projects are awarded tax credits on the first try “but we have some things in our favor. We have an extremely strong team and strong application.”
The council pointed out that while the developers were counting a waiver of $360,000 in town tap fees as a grant, traditionally the council has paid those fees from other town funds into the water and sewer fund.
The project, if approved would take about a year to construct so it could open to renters by the summer of 2015 in the best case scenario.
“It is potentially a big opportunity,” summarized Fulmer. “We hope the council will seriously consider it.”
They will debate the request for funds at the next meeting on September 16.