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HomeMy WebLinkAboutAffordable Housing Board - Minutes - 08/07/2014CITY OF FORT COLLINS AFFORDABLE HOUSING BOARD BOARD MEETING MINUTES CIC Room, City Hall 300 Laporte Ave Fort Collins, Colorado August 7, 2014 4:00–7:00pm Chair: Troy Jones Staff Liaison: Sue Beck-Ferkiss 970-221-6753 City Council Liaison: Lisa Poppaw Board Members present: Tatiana Martin (arrived 4:35), Terence Hoaglund, Troy Jones, Diane Cohn, Eloise Emery, Curt Lyons, Jeffrey Johnson Board Members absent: None Staff present: Sue Beck-Ferkiss, Social Sustainability Specialist; Dianne Tjalkens, Board Support; Mary Atchison, Director of Social Sustainability; Heidi Phelps, Grants Program Administrator; Cameron Gloss, Planning Manager Council Members present: None Guests: None Meeting called to order by Troy Jones at 4:04pm. AGENDA REVIEW Housing Affordability Policy Study will be discussed before Budgeting for Outcomes. PUBLIC COMMENT None APPROVAL OF MINUTES Eloise moved to approve the June 5, 2014 minutes as amended. Jeffrey seconded. Motion passed unanimously, 6-0-0. Diane and/or Eloise will email edits for typos. NEW BUSINESS ITEM 1: CDBG PROCESS UPDATE—MARY ATCHISON We have gone through a process to look for ways to streamline and economize staff time, reporting, and impact on the department and its budget in the grants process. Novak Consulting Group was hired to study the process and give suggestions. Mary handed out a list of recommendations given by Novak. Staff is discussing possible direction and implementation. Council will make the final decision. The renewed process is scheduled to be in place in January. One strategic priority is to work with Council to articulate priorities for funding. A process improvement suggestion is to separate affordable housing from the competitive process. Staff will have to work on how to operationalize that recommendation. Recommendation 3 is to use City funds only to fund public service and public facility projects. Recommendations 4 and 5 are to eliminate the pre-application and make technical assistance optional. Recommendation 6 is to develop a mechanism for evaluating the outcomes of the funding. It is important to show how we are impacting the community. Recommendation 8 is to clarify the role of the CDBG Commission and change their name. Recommendation 9 is to clarify the role of the Social Sustainability Department. Discussion/Q & A: • Eloise asked if the priorities would be changed annually or not. Mary said they would stay the same until the needs change. • Jeffrey asked if Council would pass an ordinance on the priorities. Mary said yes. • Jeffrey asked if there would be a permanent Affordable Housing Fund if the housing projects were removed from the competitive process. Mary said we still have CDBG, HOME and Affordable Housing Funds which are all dedicated to public facilities and affordable housing. • Sue added that the process could continue to be competitive for housing applicants and it could look different, or not. • Heidi said the funding streams are relatively constant. We will continue to have a funding allocation process, but we won’t be changing the amounts of money. • Jeffrey was concerned that health and human services would get less funding if the processes are separated. Heidi gave information on the dollar amounts from various sources that are funneled toward human services. Some CDBG money goes to administration and staff, but most of it has historically gone to affordable housing. 15% goes to human services. • Mary added that when federal funds go to a human service agency, the oversight and compliance requires a lot of staff time from these small organizations. • Jeffrey asked if the CDBG Commission no longer allocates those funds, does that commission go away? Mary said staff and the commission are unsure how to engage them if these recommendations are implemented. If Council adopts them, there could be substantive change. • Jeffrey said if you pull things apart and a funding source dries up, what strategies are in place? Can you take federal money and put it toward health and human services? You can’t do that now, so maybe it wouldn’t be a dramatic difference. ITEM 2: 5 YEAR CONSOLIDATED PLAN—HEIDI PHELPS Heidi handed out a flow chart of reporting and documents, and a proposed approach. There is a five year strategic plan on the federal side that gives a community snapshot, what needs there are, and how we will meet them. In the five year plan, there are two documents that need to be done every year. One is the Annual Action Plan that reports what the funds will be used for. Once it is approved, the funds are released. At year end, she completes the CAPER, which reports to HUD what was done. A special report is done every three to five years called the Analysis of Impediments, which includes a Fair Housing Action Plan. Actions the City takes to ensure equality for protected classes are reported. On the City side, we have the City Plan which is updated every five years. Under that is the Sustainability Service Strategic Plan which is underway, as is the Social Sustainability Strategic Plan. The Affordable Housing Strategic Plan is due for renewal next year, and a Human Services Strategic Plan is currently underway. We have completed some special reports including the Gaps Analysis and Housing Affordability Policy Study. The Consolidated Plan asks very specific questions about how much funding will be invested. The plan looks at economic development, special needs populations, homelessness, and a variety of other topics. This board will be involved as we go through the process, since much of the data collected will relate to housing affordability. Discussion/Q & A: • Eloise said the Consolidated Plan format is cumbersome. Heidi said it is a format from HUD. She suggests reading the executive summary to get the main ideas. The biggest change is that HUD has gone to a web- based format and the roll out has been challenging. ITEM 3: ACCESSORY DWELLING UNITS—CAMERON GLOSS An ADU is a small unit that is located on the same lot as a principal residence. It can be called a granny flat, alley house, carriage house, etc. The difference between an ADU and a duplex is mainly in size. The ADU is subordinate and has unified ownership. He showed examples of ADUs and duplexes. Benefits of ADUs are efficient use of infrastructure, providing even distribution of affordable housing, income for homeowners, and increase in density without substantial change in neighborhood character. They also provide housing for niche markets, such as empty nesters and seniors. Some concerns include limited parking, over-occupancy, loss of privacy, alley maintenance, and architectural compatibility. He shared a case study on Durango Land Use and Development Code. In the study, they broke the town into sectors and when polling, asked people where they lived. The responses varied based on sector. Parking was a large concern. Some areas did not want any ADUs at all, while other areas were open to all kinds, and others were accepting if the ADU was connected to the main house. From this data, they developed sub-districts for zoning. Citizens felt the ADUs should be proportionate to the lot, that there should be a minimum lot size to add an ADU, and the architecture should be compatible with the current structures. He discussed how about 11 years ago Council placed a moratorium on carriage houses because of the kinds that were being built. Some ADUs were larger than the primary residences, developers were over-populating, etc. The City looked at ADUs in the early 1990s. Council then worked to limit the number by the size of lots. Cameron and Troy looked at scale and design appropriate to neighborhoods and their standards were adopted. If we reduced the lot size needed, more could be built now. It is a tough setting to change the density standards now. Boulder and Santa Cruz, CA have implemented ADU standards with size and design restrictions. Newer neighborhoods can integrate ADUs more easily. Older neighborhoods have been more resistant to change. Discussion/Q & A: • Sue asked if Durango’s constraints are GMA or land-constraint. Cameron said is it land-constraint. They are surrounded by hills that cannot be built on. • Diane asked if the definition of ADU assumes a 12 month permanent living situation. Cameron said yes. • Sue said ADU units are smaller and more affordable to rent, but are very expensive to build at this time. Cameron said the fees are expensive because they are dwelling units. Terence said he is building a $55,000 unit and $12-15,000 of that are fees. Cameron said other communities have made changes to their impact fees to make them proportional to the size of the unit. Fort Collins currently treats all units the same. • Eloise asked for examples of communities. Cameron said Austin, Portland, Seattle, and Santa Cruz. Codes are being amended left and right in expensive communities. • Curt asked what Fort Collins is waiting for. Because we’re a college town people don’t want ADUs. They are worried about loud college students. But so many issues seem easily addressed. Seattle’s square footage requirements are lower. He lives on an acre and has been told he cannot have an ADU because of his zone. Cameron agreed there are concerns about college students and we had issues with the ADUs that were larger than the original home. • Troy said on the map, the color codes designate where you cannot build ADUs, where there are existing carriage houses, and what lots can accommodate ADUs. There is not a lot of opportunity. • Cameron said his department is hiring a consultant to develop new plans for east-side and west-side. Adding density will most likely be a struggle. • Sue said City Plan speaks to density, but when you start to build, issues arise. Cameron said it is also a use issue. The conditional use permit process can be modified. There is a provision in the code that you can add a use if it is not listed in that zone. People wonder how you can add non-residential use in residential neighborhoods. Staff would like to determine a list of acceptable uses. How do you introduce more mixed use in neighborhoods? • Curt said he is reading Green Metropolis, and in Manhattan per capita energy and carbon are lower. If you can walk to the store, you reduce your carbon footprint. • Cameron said there are ways to safeguard neighborhoods as you add mixed use including parking restrictions, etc. There are a number of businesses that have been illegally operating out of residential areas for years and no one has complained because they are not hurting anything. • Troy said if there was political will to change the lot size that could increase opportunity. Cameron said the number was set purposefully to limit ADUs. • Troy said in his neighborhood the developer allowed ADUs on any lot. There are restrictions on how many per block, but they can be on any lot. They can be attached or detached. About 80% of the houses on his block could have a legal ADU. However, the fee to convert his basement to an ADU was $15,000. • Terence suggested adding ADU as a unit type allowed in new development along with duplexes. Cameron said that is a great idea that would allow more diversity in neighborhoods. The populations ADUs serve are growing in our community and they need a place to stay. • Sue said it gives the primary owner revenue to get people into a unit they may not otherwise have been able to buy and it provides affordable housing in the ADUs. • Jeffrey asked about the pushback on changing codes for a newly platted neighborhood. Troy said there were no neighbors to complain in his development. The only drawback is the fee. Terence added that additional water and sewer taps are required for detached units. However, that could change as well. Again, it is the fee that is the cost. • Cameron added that it took four years to get the ordinance adopted in Durango. • Jeffrey said that if you roll out the concept in new neighborhoods, it will draw people who want that property type. Then the community can see how it works and we can work on changing attitudes in existing neighborhoods. • Troy added that the board will be including strong support of ADUs when commenting on the Housing Affordability Policy Study and the Affordable Housing Strategic Plan. • Sue added that we will also be looking at minimum house sizes. • Jeffrey said the historic preservation is an effective NIMBY tool. If you do not address that in an appropriate way with ADUs, there will be opportunity to obstruct. • Curt asked Cameron to keep the board informed of opportunities to give support. Cameron said the west- central plan could be an area where the board can give support. Sue will work with Cameron and Rebecca to schedule this discussion. • Curt added that it is important to let people know that ADUs are for empty nesters and aging parents, not just college students. Cameron added that from his experience you will find that variety in the existing ADUs. • Eloise said there are many people who want to downsize, but cannot find places to move. Cameron said he thinks there will be an increase in this need with our aging population. ITEM 4: HOUSING AFFORDABILITY POLICY STUDY—DRAFT REPORT HAPS will be integrated into the Consolidated Plan that Heidi Phelps discussed earlier. Staff has been trying to have the affordable housing displacement mitigation strategies for manufactured housing considered when discussing HAPS. Having manufactured home districts is a suggestion in the displacement mitigation strategy, and creating a manufactured home zone has been suggested in HAPS, but that could limit development of new mobile home parks. Troy added that when a mobile home park is failing, it can be sold off and have a change of use. However, if an owner is willing to do an easement to maintain the use, perhaps they could get funding for upgrades. Sue said HAPS goes back to the mobile home district. There is also an idea for affordable housing easements which would calculate the difference in use value and pay the park owner for that, which could help pay for infrastructure and maintain the park. Discussion/Q & A: • Tatiana asked if a mobile home park owner could apply for grant funding in the competitive process. Sue said CDBG funds were used in Washington for tiny homes, so it is possible, but there is a 40 year affordable restriction on the funding. • Curt asked if an owner occupancy ordinance for properties with ADUs could be implemented, or if landlords could be charged fines if there are noise violations on their rental properties. Sue said parties are supposed to be registered and you are allowed one noise complaint. What you are getting at is accountability. It is hard to have landlords responsible for their tenants. For example, when there is a You+2 violation, there is an investigation into fault. There is a lot of trouble monitoring owner-occupancy. We are finding that in Provincetowne. • Jeffrey said it is an enforcement issue. • Curt said we are eliminating an entire housing type because of college students. • Troy said it would be interesting to do a zone-by-zone study to see which ones you could do ADUs in and what the parameters would be. In RL, the houses were built in the ‘50s to‘90s. If you changed the minimum lot size for an ADU in that area, it might be an easier change politically than changing the lot size in old town. But the area does not have alleys. • Curt said then you go back to tap fees and other fees being cost prohibitive. Jeffrey said a lot of these areas do not have alleys, so you have a big back yard with no way to get to it. • Sue said we are looking for the biggest bang for the buck in policy changes. There will be subcommittees to look at a number of recommendations. A senior occupancy permit might not be necessary because of current ordinance language. Staff is looking at raising the amount for the homebuyers’ assistance program. It would be hard to change eligibility because of the restrictions on federal dollars. There will also be subcommittees for mobile home parks and incentive zoning. The committees will form staff recommendations will which go to the technical team, and then to Council. The waiver group will look at amounts of fee, waiving fees, and backfilling. We are looking at where we can reduce backfill. Council wants to look at fees as they relate to house size, style, or type, but Planning and Development sets the fees based on cost. • Troy said he could define that issue more specifically, looking at the impact of adding small ADUs in developed neighborhoods. • Sue said in Loveland there is a downtown zone where they don’t charge capital fees because the infrastructure is already there. However, the HAPS team was told not to look at taxes, inclusionary zoning, and to not focus on fees. • Jeffrey said we hear so much about capital expansion and tap fees and their direct impact on affordability. To have such a big study with such importance and to take those off the table is limiting and frustrating. • Eloise said the study says it is a recommendation to look at this. Sue said Planning is already working on their fees, so she is reaching out to other departments to find out more about what they are already doing. A lot of the impact fees are designed to pay for the construction of what you are trying to build. For instance, streets. We need funding to build and repair streets, and we set our impact fees to cover 80% of them. • Jeffrey said coordination between areas of the City is crucial. If the conversation is never started it won’t improve. This is a good opportunity. • Curt said even if you don’t have a solution, you need to admit it is a problem and start the conversation. • Sue said the percentage of fees in each development has stayed the same over time, but the numerical effect/actual cost has gone up. Some code provisions have also driven up hard costs. Some of the code costs should also be looked at by the fees committee. • Terence said the issue with the fees is that building an efficiency unit has the same fees as a million dollar home. Curt said it is easier to recuperate your fee costs when selling a large home. • Eloise asked if a sliding scale could be brought up to Council. Sue said that should be okay. Diane said there are other cities that can be used as examples where this is working well. Eloise suggested looking at the sliding scale structure of other cities. Troy said some of the funding we allocate could be for fee reduction. • Curt said a strong argument for that is that an individual homeowner can build an ADU for far less than FCHA can build a project. Sue said you must also consider that the private owner is building their own assets and creating income. Can they compete with FCHA in the competitive process? • Eloise said further analysis needs to be done to determine exactly where the need is in our community. Sue said the Gaps Analysis said we have a housing gap in rental inventory of 8,800 units that people are cost burdened to live in. If you take the students out, you get the number down to about 4000. If you look at the next income category, we actually have an overage. The market cannot build for the lowest income. Those units need to be highly subsidized. We would want to put an affordability restriction on ADUs that receive subsidies. We are looking to give choice to all categories and the one that has no choice now is the low income. • Tatiana said even 100% AMI needs choice in Fort Collins. They cannot find affordable housing either. • Sue said the market can provide for them if we allow it to. • Curt said the fees are the same if you are building on the periphery as they are if you are building where there are already parks, schools, police, fire, streets, etc. • Sue said if there are real reasons for different fees, Council wants to see that. An example is green field versus infill. • Jeffrey suggested using terminology like fee balancing, rather than waivers. • Sue said our challenge is to take the limitations Council has given us. We are not bringing big new revenue streams to the table. • Jeffrey asked about the ordinance for the mall. Is that off the table? Sue said no. At this point our timeline is on track to capture the mall contribution if anything we choose applies to the mall. Sue has scheduled a public outreach session for September. The only item that could affect the mall is incentive policy. • Tatiana asked what would happen if the mall was not completed. Sue said she is focusing on the best policies for our community, and if it happens to be something that applies to the mall agreement then great. The housing affordability issue is much bigger than the mall. We don’t want to direct policy to get funds from the mall and have that fall through. If we were able to convince Council that we have been backfilling more than we need to and there is more room to reduce, balance, or waive fees, that could give people an incentive to build here. We don’t build; we partner with nonprofit developers. • Eloise said one of the best solutions is to use the land bank. Sue said we have a land back subcommittee and we have ordered appraisals. The existing ordinance says the land can only be used for residential and low income, which prohibits mixed use and mixed income, which we now know is better. There is also interest in acquiring more land bank properties. These properties had development impediments, and many have been “cured.” They have probably appreciated nicely, and it would be smart of us to look for new properties that have impediments. You cannot sell them for more than 90% of market value and only for specific purposes. The technical team said they were not chosen as locations for affordable housing, but based on opportunity and price. We were not very purposeful in what we chose. It may be beneficial to sell the properties and buy new. The current ordinances do not allow that, but can be changed. If we sell the land bank properties and we carefully contract with the buyer, we can get the property we want. We would probably issue a very specific RFP. We have also discussed putting them in trust, but that does not provide revenue to put into new properties. • Jeffrey suggested selling the properties now unrestricted to purchase more property that would someday be a great location since you can maximize your value now. Sue said there are current restrictions, but they could be changed. We have interested parties should we choose to sell. Jeffrey added that water tap fees are going up in south Fort Collins, which may make the current property there hard to develop affordably. Terence said if you want to maintain affordability there, you have to sell the property significantly below market due to the cost of water. Sue said this property might be a candidate for a land trust. Once you take the cost of the land out of the deal, you reduce cost by 20%. • Curt wondered if the worst case scenario would be selling and not being able to find a new property. Sue read the ordinance regarding selling the properties. • Curt asked if the appraisals are affected by the ordinance. Terence suggested looking at it both ways: with restrictions and without (market value). Jeffrey said that will be telling in how limiting the restrictions are. • Diane suggested using different strategies on different properties. She would like to do long term strategizing with funds acquired from property sales. Sue said there are some opportunities for land banking in green field and in the TOD. Future land bank could also be used for economic development and other purposes. • Sue is working on legal definitions of what has to be backfilled as well. David will add more to the study draft on minimum house size and an executive summary. • Jeffrey said he is concerned about focus in the study. Economic development is important to affordable housing, but he wonders about the section on minimum wage. Sue said that section was to answer a Councilmember’s inquiry. • Diane asked if Councilman Overbeck is serious in moving forward a $10/hr. minimum wage. Curt said it is valid. We wouldn’t have an affordable housing board if we had a living wage. Sue said a $10 minimum wage would pull 600 households out of being cost burdened. Curt asked if it is a ballot issue. Sue said this topic is outside her area of expertise; it may be a state specific process. Jeffrey said economic development and education are very related to affordable housing, but you may be picking a fight that further stigmatizes the issue. • Tatiana said if you increase the minimum wage in Fort Collins, more people will want to move here, which will increase problems with housing. • Curt said even if you don’t have the solution, you need to acknowledge the problem. Sue said she would anticipate the Chamber’s response would be that you will lose jobs if you raise the minimum wage. • Jeffrey said to change wage equality, don’t tell people how much to pay, use other strategies. We don’t want to focus our housing affordable study on a country-wide wage equality issue. Diane added it is not relevant to the focus of the study now. • Sue said right now a tax for affordable housing is off the table, but it is important to say that if housing affordability gets worse, we might want to consider a tax. Staff will be recommending short term and midterm goals for both renters and owners. We want to make sure that whatever we do will help the continuum. We are concerned about workforce housing, but are unsure what to do about it. • Jeffrey said fee balancing and ADUs are perfectly positioned for young families and professionals. Curt said it is a win-win for the owner and renter. • Tatiana asked what the City is doing to lobby around construction defects law. Sue said we have forwarded the matter to the Council Legislative Committee and asked them to add it to their priorities for 2015. We also briefed Senator Kefalas on the matter and sought his support for a state-wide solution. • Sue added that she is under the impression that the fee waivers are a larger issue than fee balancing because the numbers are larger. Jeffrey said the fee balancing concept would be huge for homeowners. Sue said another reason we get the biggest bang for the buck in waivers is that no one else will build this product. Jeffrey said he would like waivers for more organizations. • Sue asked for feedback on the consultant’s suggestion that our ownership system is healthy if we continue to rely on our commuter-shed. Is that okay? The board said no. Sue said we are trying to create a graphic that shows how the commuter-shed provides affordability, but it does not help us reach other goals such as carbon reduction and quality of life. • Curt said from a triple bottom line perspective that is completely unsustainable. Sue said the study shows Fort Collins has become less affordable; however, Timnath’s affordable housing price has increased dramatically while the median housing price has increased dramatically as well. Jeffrey said there are a lot of wealthy people who are buying in Timnath. Sue said we have a lot of in-commuting from Timnath. Communities around Fort Collins have higher median house prices, but are more affordable based on increased AMI. Greeley is the only community with a lower median sale price. The consultants have said that given the surrounding areas are providing housing choice, we have a healthy system. • Sue requested board members email input on the study to her. She will email the board a second draft. Staff is coming up with its own recommendations, but the board can comment on the study’s recommendations directly as well. ITEM 5: BUDGETING FOR OUTCOMES OFFERS • Not discussed. OTHER BUSINESS ITEM 1: OPEN BOARD DISCUSSION • Sue said the Clerk’s Office is holding a super-board meeting for BOB2. These types of meetings will be held to get board and commission input on overarching programs. The meeting is August 25. There are BOB2 offers that will touch affordable housing. There are a $1-2 million incentive fund, and a $5 million investment in permanent supportive housing through Homeward 2020 (125 units) in the current list. • Diane asked if there was more discussion about redoing the board and commission structure. Sue said that conversation has been put on hold. ITEM 2: LIAISON REPORTS • Not discussed. ITEM 3: FUTURE MEETINGS AGENDA • Not discussed. ITEM 4: CITY COUNCIL SIX-MONTH PLANNING CALENDAR REVIEW • August 26 Midtown in Motion, West Central Area Plan was postponed • October 7 Housing Affordability Policy Study and TOD Parking Study • Private activity bond allocation is August 19—should remain on consent – Meeting adjourned at 7:17pm by Tatiana Martin – The next meeting of the Affordable Housing Board is scheduled for: September 4 at 4:00pm Participants will meet at: Fort Collins City Hall Council Information Center 300 Laporte Ave