Council to consider ballot issue for empty house fee

Community preservation initiative

By Mark Reaman

Making no bones that he was not just providing information but passionately lobbying the Crested Butte town council to take quick action to “preserve community,” town finance and human resources director Rob Zillioux argued the council should let voters decide this fall whether to put a Community Preservation Fee (formerly known as the empty house tax) on the upcoming fall ballot. He suggested a fee ranging from $2,500 to $10,000 annually. Because of timing with setting up the ballot for the November election, the council will consider and decide on whether or not to do just that at the July 19 meeting.

Zillioux presented other potential ways to raise money that could go for things like affordable housing, climate action initiatives or ways to keep businesses in the hands of locals, but it was the imposing of a Community Preservation Fee on homes not occupied by full-time residents that he advocated for the most and which garnered the most conversation at the July 6 meeting. Zillioux also suggested ideas including increasing the current sales, property or short-term rental taxes; using a bond or loan to obtain cash immediately; pursuing grants; or selling the town-owned 308 Third Street building that currently houses several non-profit organizations’ offices for about $3 million.

“No one who works for the town can afford to live in town or even north of Round Mountain,” Zillioux said. “I couldn’t live in town now, Dara (town manager Dara MacDonald) couldn’t live in town. That’s gone. Staff members are losing hope to have a life here. It’s not a place someone can come, get a middle class job, raise a family and have a long life here. People are coming here and buying the real estate strictly as an investment. The billionaire is buying up Elk Avenue.

“The economy here is broken when you can’t live and work in the same place,” Zillioux continued. “It’s not just about housing. Small businesses are shutting down. Where will the next Last Steep come from? That’s a problem. Having funky businesses here are important to town. So are the grassroots events like the Chainless and Vinotok. The dirty hippie element is a big reason many of us came here.”

Zillioux said that second homeowners, especially those who have been here a long time, are very different from investors and speculators. “A family from Texas is different than the hedge fund buying up everything.”

Zillioux said that to take action that preserves the community will take millions and millions of dollars. “In the near future it will be so incredibly expensive to live here. We have a small window to do something,” he said.

Estimating that there were approximately 350 houses in Crested Butte not occupied by full-time residents, he argued that the Community Preservation Fee would raise the most money on a consistent basis and “addresses the root cause” of the decline of community.

“Is this the same concept as the empty house tax?” asked councilwoman Mallika Magner.

“Yes,” confirmed Zillioux.

“So it’s putting lipstick on a pig,” commented mayor Jim Schmidt who has been a vocal opponent to such a tax or fee.

Magner suggested looking at an increase in the short-term rental licensing fee and bumping up the ROAH (Resident Occupied Affordable Housing payment) fee as other ways to raise funds.

“If you want to make a statement while the window is closing on the community, you have to do something fast,” responded Zillioux. “There is a sense of urgency here. Crested Butte is a special place that will take special effort to preserve. The foundation of community is people who live and work in a place. It has businesses that are locally owned.”

Magner voiced support for “harnessing the enthusiasm” of second homeowners. “They have been amazing over the years, and we wouldn’t have for example the Center for the Arts without their contributions,” she said. “They should be included in the discussion and I think they’d step up for this because it is such a compelling issue.”

Councilman Will Dujardin, who has been a staunch advocate of such a tax or fee said, “We need to change the messaging to second homeowners to be more of a stewardship thrust.”

“I agree we need to bring these people into the conversation,” said Zillioux. “We need to communicate with the second homeowners on why we’re doing it and let the voters decide.”

“I like the community preservation message,” added councilwoman Jasmine Whelan. “It’s really a broad issue and not just about the tourism infrastructure. It’s an issue that impacts everyone. It is a difficult conversation to have but the reality is we need help from people in the community with resources.”

 “It would be great to have the community unified again,” said councilwoman Mona Merrill. “The messaging of this is so important. We need to pull together as a community.”

“That’s why I like the idea of a mill levy that is spread among everyone. I wasn’t convinced the empty house tax was a good idea before and I’m not convinced the tax is a good idea now,” said Schmidt. “I’ve been disappointed in the Valley Housing Fund because I feel they’re the entity that needs to reach out to the second homeowners.”

Jim Starr of the Valley Housing Fund said some meetings had been initiated recently with some second homeowners that could be private donors for affordable housing projects.

Lindsey Freeburn said a mandatory fee would provide a dedicated funding stream that would be consistent as opposed to counting on donations that could fluctuate.

Local business owner Cole Thomas suggested that perhaps an exemption be included in the ballot language that exempts a property from the tax if they’ve donated to the Valley Housing Fund. He said that if they rent an Accessory Dwelling Unit they could also get a break from the fee.

Starr echoed a suggestion by Cathy Benson from earlier in the meeting that the town should require any accessory building on a property being built in town include a long-term rental unit.

Resident Ian Billick of the Rocky Mountain Biological Laboratory (RMBL) said the organization has offices in the 308 Third Street building and they would support the selling of that property to raise money. He reminded the council that providing housing that makes an impact will have to be done at a significant scale and while the conversation was full of desire and aspiration, to make a difference would take collaboration and work. “The goal is to get to a place where rents are affordable and that is attained by doing things like taking the land and infrastructure costs out of a project,” he said. “Buying five or six units at a time at full price won’t solve the problem. There are way more cost-effective ways to get there. Bonding should definitely be on the table.” 

Merrill and councilman Jason MacMillan opined that using a bond to generate funds should be further explored. Dujardin and Whelan wanted to move ahead with a ballot measure.

Zillioux said he would flesh out the alternatives presented and bring back initial ballot language for the council to consider at the next meeting since July 23 was the last day to inform the county that the town wanted to include a measure on the fall election ballot. The discussion will continue at the July 19 meeting.