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BOULDER, Colo. — While the Denver Metro is dealing with a massive amount of growth, cities nearby are finding ways to keep their communities small. Boulder has a unique approach in which developers have to pay into the affordable housing fund before building.
There are a few different ways developers can deal with this:
1. Paying the city’s inclusionary housing fee, which recently increased to 25 percent and will go into effect in July 2018. The current fee is 20 percent.
2. Avoiding the housing fee by including affordable units in the project.
3. Building the affordable housing somewhere else.
4. Dedicating land for future affordable housing.
While the fee is unique, 800 cities across the nation implement it. Boulder was one of the first to start this more than 20 years ago. The city said it decided to increase the inclusionary housing fee this year to help middle-class families who are feeling the crunch.
“It’s not just the lower income residents that struggle with affordable housing, but it is also the middle income. So that will provide additional condominiums or townhomes for middle income units or it will provide cash for us to support other middle-income projects,” said Kurt Firnhaber, Deputy Director of Housing for the City of Boulder.
Firnhaber said the city estimates the increase will fund an extra 25 affordable housing units every year for middle income families. Firnhaber added the city has more than 2,500 rentals and more than 800 homeownership units dedicated to being permanently affordable.
With low and moderate developments, there are federal subsidies and programs that tie in through tax credits and grants. For middle income options, the funding is more challenging by requiring cash and partnerships.
Boulder is planning for a new housing development with construction slated to begin in December 2019 near the intersection of 30th St. and Pearl St. The developer made an agreement with the city to develop the affordable housing units on site, so the inclusionary housing fee is waived.
Soon, commercial developers will also be paying more into the affordable housing fund if they choose to build in Boulder. The city will start charging 30 dollars per square foot starting this July. The fee currently sits at 12 dollars, so this summer there will be a 150 percent increase.
In Denver, commercial developers face a cheaper fee. Denver ranges from 60 cents per square foot for single-family and duplex family homes, $1.60 for apartments, $1.70 for hotel, office, retail and other commercial use and 40 cents for agricultural and industrial construction.
As for living in Boulder, the city is getting too expensive even for middle class families. The average price for a home in Boulder is more than $1 million because the outliers bring the average up with multi-million-dollar homes. The city said the median shows house prices at around $850,000, which is still a stretch for the middle-income bracket.
The median income in Boulder is $94,000 a year for a family of three and around $65,000 for a single person. In Denver, 87% of renter households earn less than $35,000 annually. That means half of all renters, and a third of all households struggle with affordability
Other ways Boulder places restrictions on growth include continuing the one percent population growth cap, limiting development in the city’s greenbelt in an effort to protect open space and restricting building height.
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