HomeMy WebLinkAboutAffordable Housing Board - Minutes - 04/06/20171 | Page
MINUTES
CITY OF FORT COLLINS
AFFORDABLE HOUSING BOARD
Date: Thursday, April 6, 2017
Location: Community Room, 215 North Mason Street
Time: 4:00–6:00pm
For Reference
Diane Cohn, Chair
Ray Martinez, Council Liaison
Sue Beck-Ferkiss, Staff Liaison 970-221-6753
Board Members Present Board Members Absent
Diane Cohn Kristin Fritz
Jennifer Bray Curt Lyons
Jeffrey Johnson
Eloise Emery
Catherine Costlow
Staff Present
Sue Beck-Ferkiss, Social Sustainability Specialist
Dianne Tjalkens, Admin/Board Support
Donnie Dustin, Water Resource Manager
Lance Smith, Utilities Strategic Finance Director
Carol Webb, Water Resources/ Treatment Operations Manager
Guests
Marilyn Heller, League of Women Voters
Call to order: 4:00pm
Agenda Review: No changes.
Public Comment: Marilyn Heller—Youth: The Hidden Homeless program this coming Monday.
Will have a homeless youth on the panel. Point in Time Count found that 20% of respondents had
been in foster care and 55% of those have experienced chronic homelessness.
Review and Approval of Minutes
Jen moved to approve the March minutes as amended. Eloise seconded.
Motion passed, 5-0-0.
AGENDA ITEM 1: Changes to Utilities Raw Water Requirements
Utilities has 3 water development fees:
1. Raw water requirements (RWR)—supply, includes water rights, storage and transmission
2. Plant investment fees
3. Tap fees—connection
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Other water districts that provide water in Fort Collins as well. Changes will only impact Utilities,
but working with other districts. RWR is based on use and type of development—goal is to generate
adequate funds to supply water to that development. Can be satisfied with acceptable water rights
(mostly ditches), cash in lieu, City certificates or credits (no longer being issued), or a combination.
Colorado Big Thompson Project (CBT) is about ½ of Utilities water supply—they are gold standard
for pricing water rights. Cost of units has gone from $7K/unit to $25K/unit in last few years. Cash in
lieu rate, however, has stayed relatively the same. Have also seen reduction in per capita water use.
Time to update RWR—want to change amount of RWR, cash in lieu rate, and move to cash only.
Anticipate population increase in district of about ~45K (residential and commercial). Have been
looking at housing by unit, but have found better correlation for indoor use by looking at number of
bedrooms—this will factor into changes to RWR amount. When infrastructure and supply is
complete, new development will still need to buy into system.
Firm yield is amount of water that can be provided through a 1-in-50 year drought. With increased
population anticipate need to increase firm yield, despite per capita use decrease. Will need $64M in
infrastructure (Halligan) and $25M in additional water rights. Cash in lieu is rate is based on these
and other supply costs divided by increase in firm yield needed. Change in cost: single family cost of
RWR would go from $4300 to $9K. Multifamily would go from $2800/unit to $3900/unit. 0.75”
commercial tap would go from $5900 to $15K, while 1.0” would go from $19.5K to $38K.
Compared to neighboring communities would still be one of lowest RWR in region.
Want to change to cash only because need to focus on infrastructure to increase supply. Need specific
water rights, flexibility, and focus on acquiring best water rights (best yields).
Presented recommendations to Council to change the RWR schedule based on number of bedrooms,
not units, adjust cash in lieu rate, accept cash only, update rates on a scheduled basis, and change
name to Water Supply Requirements. Returning to Council for approval in August. Changes to occur
in 2018. An internal task force has been formed to look at all fees and Utilities is involved in that
process.
Comments/Q&A
• Eloise: Why so many districts?
o Donnie: Two other main districts—50 years ago their area was far out of town and
utility could not run water there. Other districts formed to cover those areas. Regional
water collaboration committee—talking about how to work together to provide water
across the region. Our costs are currently lower than theirs.
• Jeff: Did GMA exist 50 years ago?
o Donnie: Developed in the 1980s.
• Diane: Fort Collins Loveland Water District—related to anything the City is doing?
o Donnie: Just named by geography, not owned or managed by City of Fort Collins.
• Jen: Areas with no identified district?
o Donnie: Vacant land or natural areas, on wells, etc. Not currently serviced.
• Jeff: Value of existing portfolio? Have more water than needed?
o Donnie: If have additional storage for wet years can stretch out water over dry years.
• Sue: Cost changes with lot size?
o Donnie: Yes. Some will be redevelopment and mixed use. Different scenarios will
change per unit cost.
o Jeff: Why is lot size relevant?
Donnie: Outdoor use. Commercial is based on tap size. Sometimes also have
outdoor use tap.
• Diane: Who decides how big the tap should be?
o Donnie: Developer. But if want over 2.0” have meeting to determine needs.
• Jeff: Does City not have enough storage?
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o Donnie: We have a wide portfolio of supply. Favorite are senior water rights on the
Poudre River—good yield in wet and dry years. No storage associated with those
rights—take and use. CBT shares have storage with them. CBT was set up as
supplemental supply after the dust bowl. Rights are allocated different amounts
annually based on models. Must consider drought quotas in shares as well. All goes
into calculations for firm yield.
• Jen: Usage is down, what are contributing reasons?
o Donnie: Conservation. 2002-2003 had significant drought and went on restrictions.
Behavior change. Went to tiered and seasonal rate structures—financial incentive to
keep water use down.
o Jen: Consideration for drought tolerant landscapes?
Donnie: Some other water providers have done that. Will look at that in the
future. Recognizing conservation in adjustments making now.
• Jeff: If raise raw water requirements, paying twice—for today and future.
o Donnie: Rates are for usage and meant to cover operation and maintenance costs for
getting the water to your home/business.
• Jeff: If increasing RWR for drought, should drop rate structure to meet less use.
o Lance: Each of utilities operates as a stand-alone business—must generate revenue to
cover all of its cost and must serve a utility purpose. Upfront costs include access to
untreated water, treatment facility, maintaining infrastructure. Rates pay for
maintenance, treatment, staff, etc. Customer benefits financially from conservation.
Tiered rate structure recognizes that everyone needs water for hygiene, health, and
some irrigation. Saw 25% reduction in use during drought, and never came back up.
Lost 25% of revenue. Most costs are fixed—must maintain pipes regardless of
amount of water going through them. Operation and maintenance of the system.
Constraints—not allowed to give discount or waiver unless Council determines that
that is a valid “Utility purpose.” City can backfill if determine that discount/waiver
meets a valid community purpose.
• Diane: Affordable housing developers feel cost burdened—cost based on where they can get
land, but constrained by how much they can charge for rent. Increased fees have potential to
stop an affordable housing development from happening. Treating affordable housing
developers same as for-profit developers. Need to see affordable housing developments as
benefit to community, not drain, because they maintaining full spectrum of employees living
in the community. Affordable housing developers are doing us a favor—get them assistance
to get these projects built.
o Carol: Council could decide that is a Utility purpose—currently constrained on what
can and can’t do, until charter or code is changed. Must think through all unintended
consequences. Had a discussion about low income rates, but was at odds with Utility
purpose.
• Diane: Impacts developer and consumer.
o Lance: If articulate water as a human right, and need to provide it to all citizens,
could make argument around discounting fees in order to provide water to all.
However, most available land is not within Utilities district. Have talked about ways
to have Utilities provide water to affordable housing projects in other district areas.
Carol: Water rights are limited in where water can be used. But looking at
ways to be more flexible in water right change decrees.
Donnie: Water court is challenging. Regional impacts of decrees.
• Jeff: Has anyone tried to change a decree to allow Utilities to move into a district area?
o Carol: Not yet.
o Donnie: Decrees are specific about service areas.
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• Jen: What does total combined fee look like?
o Lance: About $13K for single family home.
o Donnie: Would go up $4-5K.
• Sue: Affordable housing projects typically take longer to develop. If there is a phase-in for
new fees, might consider recommending affordable housing is phased-in last.
o Diane: Because of complexity of funding takes longer to develop—make pro-forma
based on current costs. When fees go up in middle of process, changes
timeline/feasibility of whole project.
o Carol: So allow affordable housing to continue at prior cash in lieu rates? Would have
to look at potential revenue loss, etc.
Lance: Might consider requesting phase-in, freezing fee at current rate for
affordable housing in perpetuity, or some other request.
Jen: Would help affordable housing projects and incentivize more affordable
housing projects.
• Jen: If shortage on water supply would that change rates?
o Carol: Have contingency built in and plan very conservatively.
• Sue: A lot of infill opportunities are within the district.
o Lance: For redevelopment, look at existing infrastructure and charge less.
• Donnie: Until costs are covered, if didn’t change rates for affordable housing, would have to
raise rates across the board.
o Carol: A choice Council can make.
• Jeff: From revenue standpoint, would not have much impact on Utility—not that much
affordable housing being developed. But freezing fee would be significant statement of
support for affordable housing. Budgets are set at beginning of a project, funding stacks can
take 2-3 years to complete. Cost changes have a huge impact on these developments.
• Sue: What about locking in rate at beginning of development and deferring payment?
o Lance: Usually locked at time of payment. Developers try to hold off payment as
long as possible. If pay up front, can help. When looked at low income rates, realized
they wouldn’t help people living in places with rent based on percentage of income or
those with utilities included in rent.
o Eloise: Some states have that when file map, freezes regulations, fees, zoning, etc.
• Sue: One rate payer cannot be asked to pay more than any other. General fund would have to
backfill unless can identify another benefit to all rate payers. Rate shift is illegal.
o Diane: Why make it harder than it already is for affordable housing projects to get off
the ground? Not paying attention to positive impact these bring to the community.
o Sue: Can explain that affordable housing is a community asset and look at ways to
support these developments—can offer some options.
• Jeff: Ask for fee lock or freeze, and phasing. Leave low income rates for another time.
• Jen: Utility charter will be looked at before November ballot regarding broadband. May be
good opportunity to make other changes to charter.
o Sue: Should determine how broad that inquiry will be.
• Diane: Would be a small cost to Utility.
o Sue: 188 units/year is our goal. Could base cost on that number. Pedcor is filing—
have property on College—looking at 200 units that could be completed by 2019.
Oakridge Crossing (120 units) breaking ground. 50 Habitat homes in the pipeline,
Redwood, etc.
• Jen: Like idea of locking fee for everyone when start development.
o Catherine: There was a community that was raising rates and a number of
developments went in to pay up front to lock in lower rate.
o Jeff: Freeze at first round submittal.
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o Sue: Could do another memo on locking in rate at submittal, with a specific time
frame to get the project complete, as a benefit to all housing affordability.
ACTION ITEMS: Board will draft a memo to staff.
AGENDA ITEM 2: Fee Waiver Request from Housing Catalyst
Letter of request provided in board packet. Last fee waiver request was for Redtail Ponds. Housing
Catalyst is only organization eligible for fee waivers at this time, and only for units serving those at
30% AMI and below. Requesting reimbursement for fees paid on 13 units, ~$100K. Disaster relief
funds had timeliness deadlines, which is why fees were paid in advance. Reimbursement is at
Council’s discretion—will be approved unless could jeopardize finances of the City. Therefore Sue
will take to Council Finance before going to Council.
Eloise moved and Jeff seconded a motion to recommend approval of the Housing Catalyst waiver
request for qualifying units on Village on Redwood.
Motion passed unanimously, 5-0-0.
AGENDA ITEM 3: Other Business
Council Comments
• Land Use Code update on consent.
• Community Based Sheltering Services—acknowledged that community based, in nonprofits
and churches, up to 15 people—will not be regulated.
• Density Bonus—Currently if development is bigger than 10 acres, must ask for variance or
modification for density bonus over 10 acres. Added language—if providing units at lower
AMI level density bonus increases automatically, incrementally, up to 25 acres.
• Competitive Process—May 16—Can thank Council for awarding dollars to affordable
housing.
• Safe Place to Rest Report in June.
• Board agreed no Council Comments necessary this month. Will consider above topics for
May.
Listening Session
• Bring Affordable Housing Strategic Plan, pipeline, completed units, etc.
• Develop ½ sheet informational handout.
• Need a one-pager that ties AMI or hourly wage to occupation. Confusion about “affordable
housing”—most don’t understand that it is for people who are working. Want to know who
their neighbors will be. Put in context of people they know and work with every day.
o Redwood has many one-two bedrooms—typical renter will make $20-30K/year.
o Have to make enough to be able to pay rent.
Land Bank Briefings
• About 100 total people attended 3 briefings. Have had both positive and negative follow up
comments/emails. Many people came in to briefings concerned about housing values,
misinformation from real estate agents, etc. However, most left feeling process is reasonable
and that City is being transparent.
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o Reinforcement that these projects go through same development review process as
other projects. Also, really highlighting images of existing affordable housing is
beneficial.
• Neighbors not against changes to Land Bank policy so much as afraid of affordable housing
development. Fear and prejudice—must help educate. Subsidized housing has standards for
who can be housed. Hard for felons to rent housing, but no questions asked when purchase.
• Make it very clear that all the regular public comment, review, and development process
applies to these projects as well.
o Making public comment and influencing change are two different things.
o Public comment has impact at Planning and Zoning.
• Worthwhile to get independent appraisers’ opinions to explain that these won’t impact their
home values?
o Working with City staff to show trends around existing LITC projects and show
exactly the changes requesting.
Agenda Planning
• May: Historic Preservation
• Tentative September: Retention of affordability deed restrictions on Habitat projects and
homebuyer assistance program
• August: Provincetowne
Meeting Adjourned: 6:15pm
Next Meeting: May 4