The Crested Butte News Serving the Gunnison Valley since 1999
Goal is for physical units
Affordable housing fees on new non-residential construction are rising toward the level the Crested Butte Town Council wants. Ultimately, the council wants all new construction to include actual affordable housing units, but if that isn’t done, they want the payment-in-lieu of housing to be at a 20 percent mitigation rate under a complicated formula.
The mitigation rate is defined broadly as a percentage of the housing demand created by a project that must be satisfied by the developer.
Basically, the PIL fee until June 30 is $18.51 per square foot on new commercial construction. That is the cost at a 10 percent rate. As of July 1, the fee will rise to $23.13 per square foot, a 15 percent rate. In two years, the fee will increase again to the 20 percent rate.
The fee on residential construction is significantly lower and ranges from approximately $2 to $5 per square foot, depending on the size of the new home. That is actually about a 3 percent decrease. For lodging development, the fee is based on a per-unit basis and will stand at $27.47.
New town planner Michael Yerman gave the council a brief history of the Resident Occupied Affordable Housing (ROAH) regulations at the June 2 meeting and said the town has about $200,000 collected under the program.
“The goal of the ROAH, as I understand it from reading the code, is the creation of units,” Yerman said. “The payment-in-lieu is a last option. In fact, actual units are required and the PIL comes with a partial unit as calculated under the formula.”
The ROAH fee is based on a formula that includes annual median income of local residents and current sales prices of homes in town. It is averaged over the last three years to come up with the square-foot cost charged to developers.
The council must currently approve the fee every year and it is the intent to put the new $23.13 fee in for the next two years. The fee will then rise again in 2016 to the 20 percent rate, at which time it will be topped out. At that time the council will let the fee fluctuate according to the formula and it will be administered by the staff. The council does not feel the need to review the charge on an annual basis.
“The payment-in-lieu numbers are not a true indication of the success of the program,” said Councilperson Glenn Michel. “It’s the units produced that matters. That’s the goal.”
Staff plans to do a survey this year of affordable units in town and determine if the units are being used appropriately.
The council will officially address the new fee schedule at the June 16 meeting.
