For years, the State of Colorado is in an affordable housing crisis, what are we willing to do to about it? According to Shift Research Lab’s 2018 report, 50% of Colorado renters are cost burdened, meaning they spend more than 30% of their annual income on housing and have less disposable income to support their families. This is no longer an issue isolated to Colorado’s Front Range or ski towns. Unfortunately, it is now a major issue affecting hundreds of thousands of Coloradoans across the state. It is also taking a major toll on our economy, with over $2 billion in annual disposal income lost to high housing costs. This in turn hurts businesses, stalls local economies and compromises state and local governments which rely heavily on sales tax revenue.
For the first time in Colorado’s history, we have bipartisan state legislation (HB 18-1195) calling for a dedicated source of funding for affordable home ownership. Thanks to the efforts of Habitat for Humanity, this bill will have a role in helping address Colorado’s housing crisis. House Bill 18-1195, sponsored by Representative Dan Pabon (D-Denver) and Senator Jack Tate (R-Centennial), provides tax incentives for Coloradoans to invest in affordable home ownership, like Community Land Trusts (CLTs). Although not a panacea for our affordable housing needs in Colorado, HB 18-1195 is a critical first step in helping increase opportunities for affordable home ownership in Colorado.
Our housing crisis is only getting worse, and the State needs to take action now. According to the 2017 State of the Nation’s Housing from Harvard’s Joint Center for Housing Studies, “Metro Denver is seeing an overall decline in affordable rental units and less than half of households can afford a median-priced single-family home in the area.” With this in mind, the City is taking critical steps to address the crisis with a commitment of $250 million over the next 10 years to develop and preserve over 9,000 affordable homes. The City’s new funding is critical for ensuring our teachers, health care workers, first responders and Colorado’s growing workforce have opportunities to access rental and for-sale housing in the City in which they work. The same needs to happen on a state level, as this is an issue affecting communities across Colorado.
As a Metro Denver based real estate nonprofit with a long history of making strategic investments to preserve and develop permanent affordable housing, Urban Land Conservancy (ULC) recognizes the problem, and has been advocating for a proven and viable solution. For more than 10 years, ULC has used the CLT model to address our region’s affordable housing shortage and affordable nonprofit facility needs.
ULC’s first CLT was in 2007 in partnership with a local nonprofit, where ULC purchased the land under 62 affordable rental apartments at the Sheridan Light Rail Station to preserve the permanent affordability of housing, where the monthly rent is $500-$800 below market. CLTs are nonprofit entities that own the land, and the improvements (building or homeowner) lease this land under a 99-year ground lease to ensure the improvements will be permanently affordable for a century. CLTs are the strongest stewardship tool to ensure taxpayer dollars and private investment in affordable housing are not lost to the market as we have seen too many times with other weaker forms of affordability restrictions. We believe CLTs would greatly benefit Colorado’s affordable housing crisis not as a temporary fix, but to support equitable, strong and healthy neighborhoods well into the future.
Now is the time for the State to acknowledge the success of CLTs by passing legislation to protect public and private investments while ensuring permanent affordable housing. CLTs are a proven successful tool in reducing displacement of working families across Colorado, and we believe HB 18-1195 provides a unique opportunity to protect the affordability of homeownership. As Denver’s median home prices continues to escalate beyond the means of working families, solutions including CLTs must be supported to create equitable opportunities for all Colorado residents. We are calling on both the Democrats and Republicans to pass HB 18-1195, as it will help increase funding for CLT home ownership across the State.
If you would like to voice your support for HB 18-1195, please contact your Colorado Legislators by Wednesday, May 9! You can visit the Colorado General Assembly’s website to find your legislator, search for a specific bill and see the House & Senate’s updated schedule.