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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 02/20/2018 - FIRST READING OF ORDINANCE NO. 037, 2018, AMENDINGAgenda Item 22 Item # 22 Page 1 AGENDA ITEM SUMMARY February 20, 2018 City Council STAFF Sue Beck-Ferkiss, Social Sustainability Specialist Ingrid Decker, Legal SUBJECT First Reading of Ordinance No. 037, 2018, Amending Article XIII of Chapter 23 of the Code of the City of Fort Collins Regarding the Land Bank Program. EXECUTIVE SUMMARY The purpose of this item is to present potential changes to City Code to add flexibility to the Land Bank Program, broaden the income levels of targeted populations and to allow mixed-use beyond solely residential affordable housing when requested by the City. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on First Reading. BACKGROUND / DISCUSSION Land banking is the practice of buying and holding land for a future use. In Fort Collins, it is an important strategy for preserving sites for affordable housing in areas where land is currently relatively inexpensive but where price inflation is likely. Securing significant parcels before land prices rise makes affordability possible with fewer subsidy dollars. Strategic selection of sites to bank can also shape the character of the community by ensuring that affordable housing will be well distributed within the City. The Land Bank Program is the City’s only long term affordable housing incentive. History of the Fort Collins Program After a feasibility study conducted in 2000, the City established the land bank program by Ordinance in 2001 (Attachment 1). The Land Bank Code language was amended by City Council in April 2016. This amendment reinforced the program parameter that rental housing be targeted to households earning 50% of the area median income (AMI), however it specified that some units could be targeted to 60% AMI if the overall community still averaged no more than 50% AMI. That program adjustment was the first since the program’s inception. Recognizing that the development environment had changed since the program was established in 2001, City Council directed staff to conduct a comprehensive review of the program. The staff recommendations proposed here are a result of this review. (Attachment 2) The Land Bank acquired 5 parcels totaling about 50 acres between 2002 and 2006. In 2009, the properties were appraised to see if they had appreciated beyond their purchase price as one indication of whether a parcel should be sold. Adequate appreciation was not found. When the parcels were appraised again in 2014, adequate appreciation was determined. In 2015, a full market analysis was conducted on each of the 5 parcels. At least 3 were determined to be development ready. City Council supported selling a parcel at that time for the first time. (Attachment 3) Agenda Item 22 Item # 22 Page 2 The Horsetooth parcel was offered for sale through a competitive Request for Proposal (RFP) process and, the Fort Collins Housing Authority (FCHA), doing business as Housing Catalyst (HC), was chosen as a development partner. The sale of the Horsetooth parcel was completed in 2017 and construction is underway on a 96-unit affordable housing community. Acquisition options of one or more parcels with the proceeds of that sale are being actively investigated. Upon completion of this program review, staff is also preparing to offer another Land Bank parcel for sale for ownership product pursuant to City Council direction and priority. Land Bank Program’s Alignment with Plans and Policy Land banking is established City policy in Fort Collins. City Plan speaks to the need for affordable housing generally and supports the Land Bank program specifically: • Policy LIV 8.7 Maintain a Supply of Land - Maintain an adequate supply of land for future affordable housing development by maintaining the Land Bank Program and acquiring additional properties as funding permits. This policy is explored in the Housing Affordability Policy Study and incorporated into the 2015-2019 Affordable Housing Strategic Plan. Current Land Bank Ordinance Criteria The Land Bank program was designed to serve the housing needs of low income residents. Very specific program parameters are specified by City Code and criteria established for the use, acquisition and sale of land bank parcels. In addition, City policy required that 3 additional conditions must be met for a parcel to be ready for sale. They include: • A verified need for developable land • Appreciation such that the parcel will sell for more than it was purchased for • Development-ready in terms of mitigation of any major development impediments. City Code Chapter 13, Article XIII. Land Banking establishes the program. It sets certain acquisition criteria for land purchase: • From a willing seller without condemnation • At a cost that does not exceed fair market value • Located in the City Growth Management Area • The location is now, or will be in a reasonable future within 1/2 mile of at least three of the following: 1. Transit Route 2. School 3. Park 4. Employment Center 5. Commercial Center Sale of the parcels to a housing provider for affordable housing development is governed by the following criteria: • For the purpose of developing a rental community where the average income target of the community is no more than 50% AMI. • For the purpose of developing ownership housing targeted to buyers making no more than 60% AMI. • Solely residential development. • Affordable in perpetuity. • Land sale price not to exceed 90% of fair market value. • Development must occur within a specified time period. Agenda Item 22 Item # 22 Page 3 What does this preclude? Mixed-income and mixed-use developments are not permitted. Market rate housing cannot be included on the land bank parcels at all. There is no provision for selling a parcel out of the program if it no longer is appropriate for the program’s goals. Assuming a sale out of the program is permitted, the provision requiring the sale price be 90% of market value would not allow the program to recapture the full value of the land to go into purchasing the next parcel and would give a windfall to the buyer. The fixed AMI levels established for rental and home ownership programs do not align with the City’s definition of affordable housing or the major funding sources currently being used by developers of affordable housing. For instance, Low Income Housing Tax Credit funding allows for rental projects to go up to 60% AMI, but the program only allows up to an average of 50% AMI. Home ownership targeted to incomes at 60% and below may be unrealistic in our current real estate market without support services that are not provided for in this program. The need for affordable home ownership opportunities exists at least to 80% AMI households and even to people with more income than that. This change recognizes that home price escalation has outpaced income increases so that a bigger pool of residents are priced out of market housing. Proposed Changes It is important to note that this program is successfully providing land for future affordable housing development as designed and is viewed as favorable to most internal and external stakeholders. Overall, the program review reinforced that. The fact that the changes are small tweaks and not major direction shifts reinforces that too. Staff has the following recommendations: 1. Allow mixed-use development when specifically requested by the City as a subordinate supportive use. • Mixed-use is considered a best practice in affordable housing development where site appropriate and where the non-residential use supports the affordable housing development or the surrounding community. • Sometimes zoning or development requirements can push developers to include commercial elements and the current Code language precludes this. Not all sites are large enough for mixed use and some site sites are best maximized as affordable residential development. For that reason, staff recommends that mixed-use development should be permitted when specifically requested. • Lastly, allowing the use of some of the parcel to bring needed services or amenities to a neighborhood can help the neighborhood more readily accept the affordable housing. • Staff is not recommending allowing mixed-income including market rate housing. While this type of development is beneficial, most stakeholders did not want land subsidy being passed to market rate units. Other City affordable housing programs do allow this type of development, so precluding it from this one program does not rule out developments of this type in the City. 2. Remove specific Area Median Income levels and tie populations targets to the goals of the Affordable Housing Strategic Plan with an explicate exception for rental housing. • When the City sought proposals for the development of the Horsetooth parcel, a City Code change was required to accept the best development proposal. This experience demonstrated how limiting the specific AMI levels in City Code could be. The idea emerged that if the income levels were tied to the Affordable Housing Strategic Plan it would add dynamism to the criteria and be reviewed on a regular basis with the plan’s five-year updates. The effect of this would be to broaden the allowable range for homeownership from a maximum of 60% AMI to 80% AMI. This is considered a more sustainable target population for this housing type. Allowing homeownership up to 80% AMI aligns with the City’s Home Buyer’s Assistance program too. • However, the need for rental product for lower wage earners paired with the fact that most Agenda Item 22 Item # 22 Page 4 major funding sources currently being used by developers of affordable housing allow units to reach up to 60% AMI steered staff to recommend that rental development be targeted to households with income of 60% AMI or less. This still increases the range of residents the program can serve without subsidizing rental ranges that are being served by market rate housing. 3. Allow some or all of a parcel to be sold or traded out of the program if it is determined to be unsuitable for affordable housing development. Possible reasons for selling part or all of a parcel out of the program could be: • a market study found the location unsuitable: • the City seeks development partners and does not get a response; • the parcel is too difficult to develop for this purpose; • The anticipated neighborhood amenities did not materialize within ten years. Also, land bank parcels cannot be sold for more than 90% of their market value under existing Code. This incorporates the purpose of using some of the value of the land to subsidize the development project. If the land is sold out of the program, there is no reason to limit the sale price to 90% of the market value. 4. Allow for notice and opportunity to cure for the reverter provisions. Current Code has automatic provisions for failure to develop timely or for failure to use for the intended purpose that would have ownership of the land revert to the City. Financial interests have suggested that customary provisions for notice and opportunity to cure such failures would be beneficial to the financing of developments on land bank parcels. 5. Lastly in addition to the proposed City Code amendments, staff recognizes the benefit of continuing to work on refining program specific incentives and design standards to maximize the development opportunities of the land bank parcels. This work will be coordinated with the City Plan update effort currently underway as well as the work of the Internal Housing Task Force. Summary of proposed changes: Current Code Proposed Change Purpose 100% Residential development Allow mixed-use when requested Supports community and neighborhood Specific AMI levels Tie to Affordable Housing Strategic Plan, except limit rental to 60% Expands populations to be served, conforms to City definition of affordable housing and aligns with funding sources Sale only for Affordable Housing Allows sale or trade when no longer appropriate for program Adds flexibility if parcel not useful for program and provides guidance to make determination Automatic reverter provisions Allow notice and opportunity to cure Assurance to lenders that developer could cure technical failures without losing ownership of land CITY FINANCIAL IMPACTS This policy change does not impact the City financially. Agenda Item 22 Item # 22 Page 5 BOARD / COMMISSION RECOMMENDATION At its February 1, 2018, meeting, the Affordable Housing Board voted unanimously to recommend Council adopt the proposed Code changes recommended by staff. (Attachment 4) PUBLIC OUTREACH Extensive public outreach was conducted on the policy refresh for this program after the Council Work Session where the full market analysis was presented concluding that several land bank parcels were ready for deployment. It was conducted in 2 phases. The first phase was designed to determine whether changes in the program were warranted. The second stage was designed to determine what changes would be beneficial. (See Communication Plan (Attachment 5) and combined outreach summary packet (Attachment 6) Phase 1 1. 2 Focus groups of Stakeholders 2. Board tour including: • Affordable Housing Board • Community Development Block Grant Commission • Youth Advisory Board • Economic Advisory Commission • Natural Resources Advisory Board • Planning and Zoning 3. City Council work session Phase 2 1. Community Briefings - 3 offered at different locations and different times of day 2. Stakeholder Workshops - 2 offered at different times of day 3. Follow up interviews with Key Stakeholders 4. Super Issue Board Meeting - Lincoln Center 5. Public Hearing before the Affordable Housing Board 6. Business Community Presentations ATTACHMENTS 1. Ordinance No. 048, 2001, Land Bank Ordinance (PDF) 2. Council Work Session Summary, September 8, 2015 (PDF) 3. Council Work Session Summary, October 25, 2016 (PDF) 4. Affordable Housing Board minutes, February 1, 2018 (draft) (PDF) 5. Land Bank Communications Plan (PDF) 6. Outreach-Focus Groups Summary (PDF) 7. Powerpoint presentation (PDF) ATTACHMENT 1 ATTACHMENT 2 ATTACHMENT 3 MINUTES CITY OF FORT COLLINS AFFORDABLE HOUSING BOARD Date: Thursday, February 1, 2018 Location: Colorado River Room, 222 Laporte Avenue Time: 4:00–6:00pm For Reference Diane Cohn, Chair Ken Summers, Council Liaison Sue Beck-Ferkiss, Staff Liaison 970-221-6753 Board Members Present Board Members Absent Diane Cohn Kristin Fritz Curt Lyons Catherine Costlow Eloise Emery Jeffrey Johnson Jen Bray Staff Present Sue Beck-Ferkiss, Social Policy & Housing Project Manager Sylvia Tatman-Burruss, Neighborhood Services Brittany Depew, Administrative Assistant/Board Support Guests Call to order: 4:03 Land Bank final staff recommendations and Board advice to Council: Sue Beck-Ferkiss—Social Sustainability Land Bank program updates going to City Council on February 20. Hope to have code changes approved right away. Done two rounds of outreach and two work sessions, and for the most part, people like the program and are happy it exists. Talked a lot about AMI levels, and staff has decided to go with 60% which is the rate most funders allow. Through RFPs, lower AMIs could be encouraged, but the code itself should offer the most generosity and flexibility. Going to allow mixed-use, but only when the City asks for it. Determined on site-by-site basis. Will be explicit about being able to sell part/all of parcel if no longer appropriate for the program. People felt uncomfortable with mixed-income because of the idea of subsidizing market rate housing. If it really seems the whole parcel cannot be used for affordable housing, a portion could be sold at market rate to a developer. Comments/Q&A • Curt: Would the developer or City ask for mixed use? o Sue: The City, through the RFP process. Could ask for specific requests or requirements. Could issue bonus points. Depends on site and what we need there. ATTACHMENT 4 o Curt: Would there be an option for a developer to say “I could make this work, but want to make it mixed use”? o Sue: We would say in RFP whether or not we would even consider mixed use. For smaller parcels, we probably wouldn’t consider it. • Curt: Is City staff currently considering any new Land Bank properties? o Sue: We are actively seeking properties. • Diane: Do we have any restrictions on what types of land, what buildings are on it, anything like that? For example, could we buy an old grocery store and make that affordable housing? o Sue: We could do adaptive reuse. I don’t believe there are restrictions to the type of property, but it does matter in terms of having to manage the property in the meantime. For example, if it was a live supermarket, we would have to manage that until we were ready to deploy. o Diane: So you’d have to manage the costs with the benefits of that land. o Sue: Yes, and I do think we will eventually have to look more at properties like that. o Jen: Does the City compete with everyone else in these properties? o Sue: Yes and no. Our best parcels are other people’s worst parcels. We’re looking for development impediments that probably will be relieved over time. Very often they have been sitting around. With another department, we identified a parcel that would be great but it’s not currently for sale. o Jen: What about properties bought in the growth management area (GMA)? o Sue: It would have to be annexed. We can own it in the GMA, but when it’s developed it has to be annexed. • Jeff: What was the decision on zoning preference for the City? There was a discussion in December: “In this ordinance, should we suggest that there be some zoning preference for Land Bank?” o Sue: I don’t think that’s going into the code itself, but it may go into the whereases. To support the idea that specific standards could be provided to Land Bank parcels to give more flexibility. o Jeff: What was the outcome of that? o Sue: I think people are open to it, but it’s continuing work. Deciding if it should be Land Bank specific, or more general for affordable housing. o Jeff: That discussion would be brought forward primarily in City Plan? o Sue: It could be. Could also be brought forward by the Internal Housing Task Force in June. It would be good to have it as least in a whereas clause. The work session we originally had, Council talked a lot about higher density. It becomes a neighborhood compatibility issue. • Jen motions that the Affordable Housing Board recommends supporting staff recommendations to Land Bank changes to City Council. Curt seconded. Passed unanimously, 5-0-0. Land Bank Communications Plan 1. INTRODUCTION This Communications Plan outlines the overall approach for communicating with stakeholders about the City’s review of the Land Bank Program. The City has assembled a technical assistance team to help the project manager. Public outreach will be in two phases. Phase 1will be community engagement to determine whether program changes will be beneficial. Phase 2 will be community and stakeholder engagement on what changes would be beneficial. 1.1 Purpose of this Document This Communications Plan outlines the overall approach for communicating with the general public and stakeholders to inform them about the City reviewing the Land Bank program. 1.2 Scope of this Document This document outlines general responsibilities for the internal City team and project manager. 1.3 Goals of Land Bank Program Communications • Raise awareness with the public about what it is and what it isn’t • Gather community input about knowledge of the program, factors that may contribute to developer participation and income levels required for housing on City Land Bank sites • Tie to the City’s triple-bottom-line and the community need for affordable housing • Address concerns about specific properties and how they’re approved through the normal City process • Gather input about future Land Bank parcels and whether the City should acquire them • Seek recommendations for improving the program. Elevator speech: The City has recently activated one of its Land Bank parcels – The Land Bank program was created to use public funds to purchase parcels throughout the community and hold them for future affordable housing developments. With the increasing lack of affordable housing in the community, the City is reviewing its policies including whether to make adjustments to the program including looking at income levels for households eligible to reside in these developments and whether more parcels should be purchased. 1.4 Anticipated Schedule Phase 1: 2016 August 1. 2 Focus groups of Stakeholders September 2. Board tour: • Affordable Housing Board ATTACHMENT 5 • Community Development Block Grant Commission • Youth Advisory Board • Economic Advisory Commission • Natural Resources Advisory Board • Planning and Zoning October • City Council work session Phase 2: 2017-2018 March 3. Community Briefings – 3 offered at different locations and different times of day. May - June 4. Stakeholder Workshops – 2 offered at different times of day July – August 5. Follow up interviews with Key Stakeholders October 6. Super Issue Board Meeting – Lincoln Center, one of several issues presented for feedback December 7. Public Hearing before the Affordable Housing Board February 8. Chamber of Commerce LLAC Culminating with February 20, 2018 Council considerations of proposed changes 1.5 Communications Objectives During community outreach and involvement for the Land Bank program, we will provide the community with ample opportunity to influence recommendations as they are being formed. This will include working closely with the City’s Communications coordinator and Communications and Public Involvement Office (CPIO). The main objectives of this communication plan: 1. Develop communication strategies to inform the public about the process – when discussions and key decisions will be made 2. Create messaging that quickly articulates the benefits of the Land Bank and why it’s needed 3. Find new and creative ways to communicate that messaging throughout the community 4. Identify messaging that will reach hard-to-reach populations 1.6 Assumptions and Constraints 1. The City has activated the Land Bank Program because it believes in its value to the public in providing affordable housing and in preserving locations for future affordable housing communities. 2. The community has expressed some concerns about individual properties and the impacts on the neighborhoods. 3. Any messaging will have to be aligned with the vision and mission of the Social Sustainability Strategic Plan and adopted Affordable Housing Strategic Plan. 2. COMMUNICATIONS PLAN This Communications Plan outlines project key messages, branding and visual identity considerations, stakeholder needs, and planned communications events and activities. 2.1 Key Messages - Fort Collins residents and City Council have expressed strong support for additional affordable housing in our community. - The Lank Bank program is one of many tactics to achieve the goal of providing more affordable housing. It is the City’s only long-term affordable housing incentive. - The City created the Land Bank program in 2001 to preserve land for future affordable housing development that would otherwise likely be developed at market rates. - Like any proposed development in Fort Collins, developers proposing projects at Land Bank sites are required to go through a development review process including a public hearing that includes Planning and Zoning Board and sometimes City Council. Secondary key messages - The Land Bank currently addresses housing for households earning 50 percent or less of the Area Median Income or AMI for rental units (rent of about $970 a month for a family of four) and up to 60 percent of the AMI for for-sale units. The 2015 Area Median Income for Fort Collins is $79,300 for a family of four. - In 2015, City staff worked with a consultant to review the City’s land bank program and recommend strategies. At a work session in the fall, City Council members expressed continued interest in deploying one or more land bank properties as long as they continue to meet the City’s affordable housing goals. The City acquired five parcels totaling about 50 acres between 2002 and 2006 that could host a total of 500 to 600 units among them: o 1500 block of West Vine Drive o 1506 West Horsetooth Road (Sold in 2017 to Housing Catalyst) o 5630 Tilden Street o 3620 East Kechter Road o 6916 South College Avenue - The City’s strategy has been to purchase underdeveloped sites lacking infrastructure, which lowers land prices, and then wait to develop them until nearby development occurs and land value has increased before selling to a developer. The theory is that land bank property will be cheaper to develop as surrounding projects construct utilities and streets. - The program is designed to sell parcels for the development of affordable housing and invest the proceeds into more Land Bank parcels. 2.2 Roles and Responsibilities It will be the role of the Communications coordinator to communicate regularly with the full group and to obtain input on communication and public engagement strategies. Roles currently: Community Engagement: Sue Beck-Ferkiss, Clay Frickey, Beth Rosen, Kerri Allison, Victoria Shaw PR/Marketing and Communications: Emily Wilmsen Tactics could include: Traditional media • Press release (if appropriate – if new ordinance is drafted/major changes are suggested) • Individual media tactics: o Set up interviews with Coloradoan, BizWest, KUNC to educate them o Soapbox Website and social media • Add FAQ to website and spotlight it on fcgov.com • Update Land Bank page with focus group notes and archived materials from the discussions over the past several years Marketing materials • Fact sheet(s) Newsletters • SSA newsletter • Neighborhood News Internal • FortShorts • Issues and Answers • SIT/Leadership Link • CityNet Land Bank Focus Groups Conducted on August 3 and 8, 2016 Stakeholders included: For-profit and non-profit developers, affordable housing advocates, city staff, and elected officials. Question 1- How much do you know about land bank? • Both groups heard of program but did not know details Question 2- What do you think of land banking as an incentive? • Both groups generally supported the idea • Great idea if conceived and administered properly • Curious – but seems like only works to sell land to generate cash to build housing. Question 3- Reduced land pricing enough of an incentive? • Land is a huge incentive. • Still could be too hard even if you give the developer the land. • Developers in Boulder are using IHO to do cash in lieu to developer and building units off-site. • A transfer tax would be great. • Potentially allow a portion of sites to comply with existing zoning but allow a second phase at a higher density. • Might need to pair with additional subsidy. • Water going from concern to crisis • Doubtful that reduction adequate to offset difference between market rate and affordable. Need consistent source of income – preferable small charge paid frequently. • Easier process just as important. Question 4 – Locations of current parcels • Kechter has commercial value. Maybe swap or mixed use development. Question 5 - Additional parcels? • Put RFP our there for a realtor when looking to purchase Land Bank parcels. You need a good commercial broker and I can help you put together a RFP. • Should use same people that for-profit developers use. • They can get you parcels that aren’t even for sale. • Every place we’ve bought and developed has had some deconstruction, nothing is vacant. • Near mass transit • Consider air rights – exploit through public private partnerships ATTACHMENT 6 • Market too hot – but if opportunity presents then jump on it. Question 6 – Acquisition criteria? • Like tying RFP’s to current AHSP. • Need a RFP process. • Use RFP not ordinance to ask for optional desires – ie: give bonus points for age friendly design. • Use needs articulated in Affordable Housing Strategic Plan to guide RFP process for buying and selling. • While locating near transit important – should be in RFP not code • Be careful with height and density bonuses - May not have the beneficial effects desired and could have negative consequences. • Get a realtor and use loopnet, or other real estate software. Competing against professional developers looking for land. Question 7 – Ownership opportunities? • More communities have failed with IHOs than have been successful. An example is Boulder. Loveland and Longmont threw theirs out since it killed a couple of projects. The buyers love the fact they get a good deal on the front end with a lower price but can’t get good enough equity on the back end. To really promote or require ownership is tricky. We should go for rental. • IHOs is different than ownership, I agree IHO doesn’t work. I think ownership can be good but shouldn’t be the stated goal of the program. You can have ownership that doesn’t put constraints on what you sell it for. Trust could have first right of refusal, that it be owner occupied and not held as rental. Those two will hold market value down so you get de facto affordability. Formulas for AMI or CPI don’t work when the market goes south. In some cases if it’s modeled correctly and all of the structure is well thought out and you have someone monitoring it, then it can work. • 60% AMI is too low for home ownership, should go up to 80%. This would better meet industry standards. • 60% only works for Habitat. A developer isn’t going to do all the handholding that Habitat does. • No viable incentive in the City to do that. • No one gets paid more to work on a tax credit project. • How do you preserve permanent affordability? o Deed restriction, but that can kill a project. o Important to write deed restriction properly to not kill projects. • Most mountain communities need deed restriction removed by Council. Can turn into a headache. • First right of refusal for land owner should be in the ordinance. • Make sure first buyer gets deep discount from market process in order to keep affordable to subsequent buyers. • 18 units or more needed for economy of scale. • Need to share appreciation or not worth doing for consumer. • Consider new mobile home parks – especially if they can be resident owned. • Difficult to accomplish – especially if comes with controlling covenants. Question 8 – Income levels? • Don’t like 50% average. We need new 30% units, we have a 3 year wait list for 30% units. • Require 5% of new units to be 30% AMI but we encourage greater. Did cost analysis and it’s something close to $90,000 per unit of subsidy. • Used to be $105,000 with 5% return, thought it would be higher. • Depends on the area. • Had idea to do fundraiser and put the donor’s name on the door or driveway to create our own funding sources. Portland does a great job of this. • I would remove restrictions since you don’t know what conditions will be in the future. If you do everything on a RFP basis and assign points based on the proposals that address the AHSP, you have a lot more flexibility in selection process. Weights can be dynamic so it can reflect what is going on in the community. • Don’t want to shy away from competition by forcing developer to develop 30% AMI units. • We have some out of town developers that would develop 30% AMI units since they are big advocates of affordable housing. • Like tying the RFP to the AHSP • Ownership level too low. • Income levels too low – look at 80%. Question 9 – Mixed –use and/or mixed-income? • Yes, Holiday is a great model and avoids having too much concentration. • Density in LMN is an issue. • If you have a charrette, your program should allow whatever you do at the charrette. Let market figure out what size of parcel will work for mixed-income and mixed-use. • Mason corridor has been great for mixed-use projects. Mixed-use could be a way to finance the program. • Don’t restrict anything, allow creativity. • Something you could do is if you’re looking at sales price for the land and there is some market rate, pro-rate what you’re selling land for so you aren’t subsidizing market rate housing. Public might have negative perception of subsidizing market rate. • Boulder subsidizes workforce housing up to 115% AMI and we may be there soon. • For larger parcels, you would want market rate to help subsidize 30%. • If HUD regs stand, you will have concentration issue. • Be as flexible as possible and let the market determine the best use for the land. • How do we discount the value of the land and then use it for market rate housing? Can we sell the market rate part for more than 90% of market value? (Would require code change). Can we price different components differently? Or would overall community be enough of a benefit to justify discounting even the market rate product? • Only allow swap or purchase if another parcel already identified for acquisition. If project has commercial – require a nexus to affordable residents. Child care facility good example of commercial with nexus. • Look at Holiday from Boulder • Mixed-use and mixed-income can be incentives – however, this shifts rent burden to non- affordable units and impose financing and marketing obstacles. • YES – don’t have enough room or land to not consider this option. • State Land Board has rules we could look at that allow sale but only if another property will be acquired within 36 months. Question 10 – City’s role in Affordable Housing • Convener – bring interest groups together. • Political role – lip service to proactive planning. Reality – City not demonstrating forethought, leadership, or creativity to get ahead of issue. Question 11 – Ability to sell out of program? • Be careful in getting rid of land because land is tough to acquire. Not much land available for development. • If property isn’t being utilized, like Forest Service, they have ability to exchange it for a different parcel? Land swap vs. land sale. It’s a repurposing of land. Maybe it isn’t suitable anymore but perhaps we can trade for one that is. • No reason to disallow a swap or sale as long as is will fund the purchase of a better site. • If you buy and sell in same market better than holding money which may then not purchase as much because market has changed. • Look for specific partners to swap with such as government owned land, CSU, private land owners with land in attractive locations for this purpose. • Tricky to use public funds for one objective only to use for something else – could be perceived as subjective or political. • Yes, it might make sense to sell to generate cash to build elsewhere. Question 12 – other land bank comments? • How about doing a land lease instead of selling to a developer? • Make sure you have the right partners – include CSU. • How about selling off portions of parcels and saving some for the future when zoning might allow more density? • The next 5 years are critical as we approach community build out. Be aggressive now when there may be more land to buy. Diminishing impact if wait too long. • As we move into future, less land available and therefore less land banking opportunity. Act now! Also, the faster we build on these parcels the quicker we will have more affordable inventory that then stays as community stock. • Providing a preference for qualifying city employees is politically difficult. • Should program have a sunset review – put up or shut up over the next 5 years. • Sell parcels that are sized correctly for tax credit projects – look to provide 120 units for 4% LIHTC deals. (10 acres in LMN). • Can the creative class be targeted? • Build as much flexibility into ordinance as possible and use the RFP process for details. • How can Community Land Trusts help? Regional land trust is a good idea. • Look to incentivize things we want such as stepless entryways by providing fee relief – such as water or street oversizing. • This is a tool we should keep – but not enough to make big impact on issue. Additional Comments • What other partners do we need to create more affordable housing? Employers? • Ownership vs. rental • Did a project called Maple Hill when I was on FCHA board and that is when we tested incentives of the City to see if they promoted affordability. Had we complied with everything, we would have saved $1,500 per lot. Incentives right now don’t work. • If City just donates land or discounts it, then it could work. Horsetooth wasn’t much of a discount but it can work with tax credits. • May not have to do both if you donate land. For Lowry, City kicked in money in addition to donating land. There are some other resources but I wouldn’t preclude it. • How restrictive do you want ordinance to read not knowing what conditions will be in the future? The ordinance should include what bare minimum should be as opposed to adding more exclusions, etc. • Need 18 du/acre to build in economies of scale • Are there incentives for tap fees for affordable housing? • What about a “water bank”? Water will be 3 times the cost of land soon if not already. Cost and availability of water will be next crisis. • Look into air rights. March 13, 2017 Council Tree Library – About 35 people. Questions and comments from public: 1. What does reasonable infrastructure mean in terms of when a land bank property is ready for development? 2. Concerns about increased traffic 3. Concerns about school capacity and roads 4. State that area around tilden and kechter is lacking infrastructure still. 5. Gentleman raised in farmhouse at kechter. Will there be a historic review? 6. What is the schedule to sell properties? (there isn’t one) 3 months- 1 year on policy work and choosing next parcel Will decide when to sell on case by case basis 7. When will there be an RFP on Tilden? What is the next property? 8. How do we sell a parcel out of the program? (Hands tied by existing program) 9. What is mixed use? Clay – rec center example 10. Could strong opposition stop development? Clay – only LUC reasons, not because AH 11. What’s time frame for accepting bids? About a month after RFP issued. 12. Residents informed when a partner is chosen. They will hold neighborhood meeting. 13. Concern of timeliness of Outreach – that’s why we have 3 briefings 14. Is the city facing a deficit of AH? Yes – looking to distribute throughout City of Fort Collins 15. Concern this will negatively affect housing values. Sue - nationally not the case, will research locally. 16. Logistically, when you sell property how do you keep it affordable? Deed restricted in perpetuity 17. Is this different than Provincetowne Condominiums? Yes 18. Concern that development is expensive – how to reach affordable range. 19. Do we have a problem attracting developers? No 20. Concentration around College parcel? Depending on what gets built – maybe… 21. Will this house section 8 holders? Mostly not, but maybe. 22. Who approves these developments? P & Z 23. Kechter – if rental property built, who would be landlord? TBD 24. Is water an issue? Yes 25. Counterintuitive that AH doesn’t hurt housing values. Would like more information on that. 26. Under current policy, are developers required to consider park space? Yes – open space, bile lanes, etc 27. Can developer sell? Yes – but only to another AH provider. 28. Does City save historic land and houses? Yes – Historic preservation process described. March 20, 2017 Old Town Library – about 25 attendees 1. Explain what AMI means. 2. Would land bank development work with Section 8 vouchers? Maybe 3. Show slide with 5 conditions. The College parcel doesn’t have that. What does that mean? Under current code – hold. Under proposed changes – perhaps sell or swap. 4. How do you know which type of product? Sue – partly what we ask for in RFP. Clay – Up to developer 5. How would I find out what will be built on Tilden? Citydocs link. Look for yellow sign. 6. Will development have its own HOA? Probably 7. Tilden is a small road. What volume will it be expected to carry? Clay – Master Street Plan guides this. 8. School density impact? Schools already full. PSD involved in process and is planning for growth 9. Which comes first- housing or school? Clay – can be chicken and egg 10. Is there a separate department at the city requiring rental units? Specific to College. RFP can guide this. 11. How can you keep housing affordably in perpetuity? Deed restrictions 12. HOA fees can grow. Will there be oversight for this? Not really – except that overall monthly payment includes HOA fees and will be part of how buyers are certified. 13. What does application process look like to live there? Depends on developer – Redwood example – lottery for qualified applicants. 14. Any sense of which parcel will be next? Policy work first, then analyze and chose next to deploy. 15. Neighborhood meetings – Do developers use information and apply to development? Yes 16. West Vine – when will it develop? Since flood plain, not likely before 5 years. 17. Can the land be used to support affordable hsouing but not for housing, such as a community solar garden or other community benefit? Not under current ordinance, but possibly under proposed changes. 18. Morning workshop the preference for most people. March 27, 2017 Foothills Activity Center – 35 ish people 1. Once Horsetooth sold, what keeps the developer in compliance?( Deed restrictions, monitoring and compliance). 2. How do you change rules – Vine in floodway. Told by stormwater it wouldn’t be developed. Numerous meetings with City years ago. 3. When will next parcel get activated? Will it be Tilden? 4. What determines which parcel will go next? 5. Have you studied how it affects home prices? (We will study trends in the community) 6. Where will W. Vine ditch be located? It won’t take care of water issues. 7. Will there be a HOA? How will the property be run? 8. Concerns about increased traffic and noise pollution on Trilby. (Clay – noise barriers not usually used – fees for street impact.) 9. College parcel – where is it and what happens if amenities never develop around it? 10. Why wasn’t land bank mentioned at Pedcore meeting? 11. Density question- consultant said 16 DU’s per acre. (Wasn’t changed). 12. Change 10 acre density bonus? Explain automatic extension currently going thru process. 13. Is Horsetooth first? Is the idea to make $ for more affordable housing? (Evergreen – but doesn’t mean it will always sell for maximum). 14. Are all LB parcels zoned residential? 15. Why does City own parcel in County? What is county zoning? 16. How much land is in bank? 17. Richmond model – said Land bank would be a park. No disclosure by builder. Where is this marked on City maps? 18. If home builders aren’t disclosing, feel like hiding the fact that 12 per acre could be built close to urban estate and other zones that only allow 2-4 homes. 19. Nip this is in the bud by posting signs on the parcels. Real notice. 20. Zoning – only single family? (No – allows multifamily). 21. Backdrop is zoning. What incentive for developer to NOT maximize density? 22. Kechter – will street stub need to be built out? (yes) 23. Additional notification to homeowners? (Development review will include neighborhood meetings) 24. Development review process? Strauss Cabin example. 25. Traffic – City has done nothing. 26. Neighbor claimed City did not notify when purchased Kechter. 27. Do you want ot buy my house? 28. Tilden – valuable – sell it for $3 million. Land Bank Program Policy Refresh Workshop June 5, 2017 Colorado River Room, 222 Laporte City Staff: Sue Beck-Ferkiss, Clay Frickey, Ginny Sawyer, Victoria Shaw, Sylvia Tatmun-Burruss Affordable Housing Board members: Diane Cohn and Curt Lyons Approximately 25 stakeholders attended including: for profit and non-profit developers; neighbors of land bank parcels; realtors; lenders; business folks; affordable housing advocates; faith-based communities; and interested citizens. After a brief staff presentation, the participants worked in small groups on analyzing the program for strengths, weaknesses, opportunities and threats. There was an opportunity for questions and answers and then a polling pad exercise. Summaries follow for all these activities. Strengths – Best attributes that we want to keep: • Proactivity of City • Premise of program still strong and relevant • Competitive process used to deploy positive • Acquisition criteria good • While AMI targets generally good, probably too low for home ownership Weakness – Where is the program constrained? • No parcels in NE quadrant of City • Parcels not physically posted with signs to provide notice of inclusion in program • Building housing time consuming and doesn’t help with current needs • Program too specifically regulated so that changes in needs over time not accommodated • High City standards in land use code don’t allow maximizing potential of parcels • Commercial development not defined and program not flexible enough to allow this • Maximum AMI for homeownership at 60% AMI too low • Low density zoning limits opportunity • Too focused on federal funding which lends itself to rental not home ownership • Not enough time built into the RFP process to allow proper due diligence Opportunities – What is the best use of these parcels? • Create an overlay district with unique standards for Land Bank Program • Consider selling, subdividing or swapping parcels when required amenities don’t materialize • Use development partnerships to create communities of mixed pricing and tenures • Increase maximum income for home ownership to at least 80% AMI and build in a split of appreciation to keep affordable to subsequent buyers • Experiment with housing types – such as tiny homes, or small homes with shared open space • Use to serve special populations such as seniors, disabled, critical workers, or alternative students • Explore timing of sale to leverage other market rate housing for efficiency and to combat NIMBY • Create comprehensive strategy to serve entire housing spectrum • Opportunity to level the playing field for affordable developers who need to compete with other community policies - such as fees, open space, and zoning. Threats – What do we want to avoid? • Concerns about increased traffic and overcrowding schools • Oversaturation of affordable housing causing pockets of poverty • Isolation of those living in affordable housing • Concerns about negative impact on esthetics and housing values • Cautions about building mixed-use at a time when retail industry experiencing big changes • Letting projects that meet the code get derailed by NIMBY • Exasperating the low inventory situation by taking land out of the real estate market • NIMBY – how to message to avoid or mitigate • Selling a parcel without having anything to buy or buying a parcel that cannot be developed • Leaving people out of the housing market who do not have appropriate options 3 questions were submitted in writing: 1. Why haven’t we purchased additional parcels since 2006? Lack of opportunity and funding 2. If we allow mixed use, won’t that mean less affordable units? Probably – but depends on design 3. Is mixed income necessary because the surrounding neighborhoods are all market rate or luxury? Again, depends on the specific development and timing of the proposal. Following are two follow-up letters sent after the workshop. One is in favor of the program and one against. (There were a few additional follow up letters providing general support for the program). Citizen letter opposing program: Hi Sue: Good meeting last night. However I would point out that it seemed a majority of people who participated were not simply concerned citizens or citizens impacted (home within 800 ft of a land bank program) but many seemed to have a business interest or city relationship who were not excluded in the voting! Therefore, it would make sense the vote would be skewed in support of the program and for high density low income units. The more dwellings and the more units the more money the developers in the room can potentially make or more likely u will get proposals from RFPs. Again, I am opposed to my city using our resources (tax dollars/salaries for people working the program) to take large tracts of land out of the private sector. I don't think this program is something the city should be involved. Also taking land out of private sector only perpetuates the problem of lack of availability of housing particularly when u hold it for 15+ years before building. City should be focused on zoning policies that could turn more private sector tracks into higher density multi-family dwellings but not in the real estate purchase business that actually competes with private sector. I was hoping the meeting agenda would include actual discussion about the validity of program itself and alternates. Instead it was only focused on keeping and maintaining the program instead of alternates such as vouchers, grants or creating a 5% low income deed restriction in the multi-family dwellings being built so people can truly be allowed to live anywhere it is good for them to get work! Also program lacks targeting of certain classes of people such as seniors, disabled, city workers (police, fire, health workers, etc). I don't want to pay rent of pot smoker who thinks working at McDonalds is a career or could support a family. How about including adults attending educational programs. Citizen letter supporting program: Hi Sue, Sorry for arriving late Monday night, but glad I could attend a portion of the workshop. I’m pleased to hear that one of the parcels (Kechter) is close to my home and hope it is one of the viable plots of land. One of the things that nonprofits have to focus on is what makes for a viable business model. So as far as what range of AMI fits for a particular nonprofit rental property builder, I’d recommend asking them for their input directly. I’m not in a position to speak for them. Nonprofit homeownership builders such as Fort Collins Habitat for Humanity often have specific AMI criteria they need to meet (or plan to target) to fulfill their tax exempt purpose or to meet grant restrictions. There are for-profit builders that are interested in affordable housing, so this is a third set of potential partners that have valuable input on business models that fit with their ability to contribute to the need. I see value in the City selling unsuited affordable housing land and using the proceeds for building fee & permit reductions for new affordable housing unit construction by partner entities. This would act as a financial incentive to build new affordable housing units. Regarding for-profit builders, I could see the City offering scaled permit partial rebates (using this same funding mechanism) for any new housing units that sell below a City established price threshold based on type of property (single family vs attached). This could be just the what some builders need to make a living selling lower-priced housing units. I appreciate that the City of Fort Collins has operations in the area of affordable housing, and as I mentioned briefly at the meeting, this seems highly appropriate to balance out other affordability impairing standards and practices that exist in most cities. Habitat for Humanity of Metro Denver serves the better part of 5 counties in a Denver Metro area that includes around 40 communities. I’ve become much more aware of how varied community responses are when it comes to mitigating unintended consequences of City policy on housing affordability. Communities are far from consensus, so it is easy for a community like Fort Collins to stand out if it chooses to do so. Given City standards and practices that impact housing affordability, such as buying up nearby open land to preserve open space (specifically to prevent building), requiring certain building standards such as setbacks or landscaping (often for great reasons)—that lead to safer and higher priced homes—it makes sense for a City to have offsetting affordability housing standards and practices to help ensure that less well-to-do City residents are not unintentionally thwarted in their desire to become homeowners. Cities are not obligated to establish progressive, counterbalancing policy, but the existence or absence of same does send a highly-visible message on a City’s world view. That Fort Collins has an affordable housing land bank and that you are reading this email in response to a workshop on affordable housing, bears witness that the City of Fort Collins is interested and is actively working this important topic. On a side note, earlier this year I visited the Philippines for my brother’s wedding and had opportunity to see first-hand individuals living in bamboo huts and partially built cinder block homes (tin roofing over portions of their houses). I saw family plots being unofficially sub- parceled to build more family homes. I was told by our van driver that bamboo walls are good for perhaps 5 years before they start rotting out due to moisture—yet the Philippines allow these types of temporary housing construction decisions to help keep roofs over the heads of their poorest citizens. Their government chooses to accept the housing “noise” (variability in construction standards) that come with not intervening to prevent these types of housing decisions. It had me thinking, are we less compassionate—ironically in the name of public safety—when it comes to our poorer citizens? While we have building code that keeps housing poverty out of sight, I have no doubt that we have individuals living in our City that have similar, pressing needs for lower-end affordable housing. We visited this particular housing compound and one of the residents with a nicer house (who happened to be currently working in Saudi Arabia) allowed us access to her house because it has Western-style facilities (which are absent in many Philippine homes). The door was left unlocked and various family members from the surrounding family compound visited the unlocked home throughout the day. My eyes were very much opened by their world view. For sure, these decisions do not reconcile with our housing standards and sensibilities. That being said, why not do what we can? ☺ Best wishes for the City’s affordable housing efforts and initiatives, and feel free to share this message as I didn’t fill out a form at the event. Land Bank Workshop Glossary Affordable Housing Housing that has a sales price or rental amount that is within the means of a household with moderate income or less. In the case of dwelling units for sale, housing that is affordable means housing in which principal, interest, taxes, home owner association dues and insurance constitute no more than 38 percent of the gross household income for a household. In the case of dwelling units for rent, housing that is affordable means housing for which the rent, heat, and utilities other than telephone constitute no more than 30 percent of the gross annual household income. The rent or sale price must be affordable to households earning no more than 80 percent area median income. The unit must be affordable for a period of not less than 20 years. Affordability Period (AP) An affordability period is the time frame for which rental payments or purchase prices must remain affordable. The typical requirement is for 20 years but the Land Bank Program requires permanent affordability (in perpetuity). Area Median Income (AMI) The point at which half the households in an area make less and half make more. The median annual income figures are adjusted for family size and calculated annually by the U.S. Department of Housing and Urban Development (HUD) for every regional area in the country. AMI is used to determine if a household’s gross income qualifies for affordable housing and assistance programs. Community Land Trust (CLT) Community Land Trusts are a means of achieving permanently affordable housing similar to the city’s deed restriction (see “Deed Restriction”). CLTs are membership-based nonprofit organizations that own the land under a housing unit affordable to low- and moderate-income households. Affordability is initially achieved through this separation of the land value from the value of the home and improvements. Income-qualified households purchase the home, but not the land, thereby realizing a price reduction. Affordability is ensured through a 99- year ground lease, which restricts the resale price on the home. Deed Restriction, Affordable Housing A legal obligation imposed by the city upon the owner of residential real estate to restrict the sale prices or rents to keep these homes affordable into the future. The restriction is enforceable on subsequent buyers of the property. Density The number of housing units per unit of land, usually per acre. Density Bonus The allocation of development rights that allow a parcel to accommodate additional square footage or additional residential units beyond the maximum for which the parcel is zoned, usually in exchange for the provision or preservation of an amenity (such as affordable housing or open space) at the same site or at another location. Dwelling Unit Dwelling unit shall mean one (1) or more rooms and a single kitchen and at least one (1) bathroom, designed, occupied or intended for occupancy as separate quarters for the exclusive use of a single family for living, cooking and sanitary purposes, located in a single-family, two-family or multi-family dwelling or mixed-use building. Homeowners’ Association (HOA) A Homeowners’ Association (HOA) is a self-governing association that, in most cases, is created by a real estate developer for the purpose of controlling the appearance of the community and managing common area assets. HOAs are handed off for private control to the homeowners. Association dues are used to cover maintenance, capital improvements, and upgrades. Housing Choice Vouchers (Section 8) Section 8 is a federal housing program providing rental assistance to eligible families and elderly residents that allows them to rent units in the private rental market. The most common Section 8 assistance is the voucher program. The program is tenant based and the assistance stays with the family-where ever they choose to live as long as the landlord agrees to participate in the program. Inclusionary Zoning Zoning regulations which create incentives or requirements for affordable housing development. This can include set-aside requirements or density bonuses for developers. Land Banking Land banking can be pursued to achieve a broad array of community goals. In the housing context, land banking is the purchase of land by the city or a nonprofit housing corporation as a future site for affordable housing or other housing that meets community goals. Low Income A household whose income does not exceed 80 percent of the median income for the area, as determined by HUD, with adjustments for smaller or larger families. Low Income Housing Tax Credit Tax incentive created in the Tax Reform Act of 1986 that is designed to attract equity capital for investment in rent restricted affordable housing. The program encourages the production of affordable housing by offering its owners tax credits for a ten year period based on the cost of development and the number of low income units produced. Their contributions offset the cost of building or rehabilitating the property, which allows rents to be low. In Colorado, the Colorado Housing and Finance Authority awards federal tax credits. Each unit in a tax credit-funded property has an associated low-income limit. Tenants’ must income-qualify annually and, in turn, they pay below-market rents affordable to the AMI associated with the unit they occupy. Market-Rate Housing Housing that is available on the open market. There are no restrictions on the selling price or rent of market-rate housing, and anyone who can afford to rent or purchase market-rate housing may do so. Market-rate housing is subject to fluctuations in the housing market, and, market-rate housing is unaffordable to many of those who work in the community. Mixed-Income A type of development that includes families with various income levels. Mixed-income developments are intended to decrease economic and social isolation. Mixed-Use A type of development that combines various uses, such as office, commercial, institutional, and residential, in a single building. Multi-Family Housing Multi-family housing means multiple dwelling units contained in one building. Section 8 A federal housing assistance program in which participants pay a portion of their adjusted gross income (i.e. income after standard deductions) for rent and the remainder of the rent is paid by HUD. Section 8 is either project based or tenant based. www.hud.gov/offices/pih/programs/hcv/index.cfm 2017 Income Limits Income Limits (effective date 04/14/17) 2017 Median Income: $76,800 (Fort Collins/Loveland Metropolitan Statistical Area) Household Members Income 1 2 3 4 5 6 7 100% of AMI $53,800 $61,500 $69,200 $76,800 $83,000 $89,100 $95,300 80% of AMI* $43,050 $49,200 $55,350 $61,450 $66,400 $71,300 $76,200 60% of AMI $32,300 $36,900 $41,500 $46,100 $49,800 $53,450 $57,200 50% of AMI* $26,900 $30,750 $34,600 $38,400 $41,500 $44,550 $47,650 30% of AMI* $16,150 $18,450 $20,750 $24,600 $28,780 $32,960 $37,140 AMI = Area Median Income 51-80%: Low Income Limit 31-50%: Very Low Income Limit 0-30%: Extremely Low Income Limit Sample occupations for income-restricted apartments (Based on 2016 income limits for 4-person households) Restriction Income Limit Hourly Salary Sample Occupations 30% of AMI $23,460 $11.27 Bank Teller or Personal Banker; City Utility Worker; Office Assistant; Sherwin Williams Branch Manager; Certified Nursing Assistant; Housekeeper; FCHA Janitor 40% of AMI $31,280 $15.03 City Office Support Specialist or Transportation Dispatcher; PSD School Custodian; Credit Union Financial Specialist; FCHA Administrative Asst; Forestry Field Worker; Maintenance Technician 50% of AMI $39,100 $18.80 PSD first thru fourth year teacher with BA; Larimer County Accountant I, Civil Engineer I or Health Dept Social Worker; FCHA Administrative Assistant or Accounting Clerk; Landscape Project Manager 60% of AMI $46,920 $22.56 PSD 5th through 9th year teacher with BA or 1st through 6th year teacher with MA; CSU Pharmacy Technician; CSU Financial Aid Counselor; County Employment Specialist; FCHA Property Manager Boards and Commissions Super Issue Meeting MEETING NOTES M onday, October 9, 2017 Lincoln Center, 417 Magnolia – Columbine Room 6:00 p.m. – 8:00 p.m. North Front Range Wasteshed Planning Process Presenter - Honore Depew, Environmental Planner City Council has adopted aggressive goals for reducing: Waste sent to landfills and community greenhouse gas emissions Fort Collins staff and elected officials work closely with representatives from Loveland, Estes Park, and Larimer County to plan for the future of waste handling as part of the North Front Range Wasteshed Coalition reviewing programs and infrastructure for waste materials management and resource recovery. This presentation focused on relaying information regarding Phase 2 of a five-phase process to prepare for what will come after the Larimer County Landfill closes – the only publicly-owned landfill in Northern Colorado – which is forecast to reach capacity by 2025. In Phase 2 the Wasteshed Coalition has been working closely with a consultant and a group of stakeholders to: Establish goals and objectives for the process; Better understand waste generation rates and needs for future waste-handling capacity; and consider 11 options for infrastructure, including several to address organics. 1. Status Quo 2. New County Landfill 3. Central Transfer Station 4. Material Recovery Facility (MRF) – Recyclables Only 5. Yard Waste Composting Facility 6. Construction & Demolition Processing Facility 7. Energy from Waste Facility – Direct Combustion 8. Mixed Waste Processing Facility (“Dirty” MRF) 9. Aerobic Composting Facility – Including Food Waste 10. Anaerobic Digestion (Facility or w/ Wastewater) 11. Energy from Waste Facility – Refuse Derived Fuel (RDF) More information on the North Front Range Wasteshed planning process. 2018 Strategic Plan Update Presenter: Lawrence Pollack, Budget Director with David Young, Public Relations Coordinator Attached is the strategic planning feedback form. Community and Public Information Office (CPIO) is asking for Boards and Commissions input on top concerns for the community and which objectives are priorities for you and Boards and Commissions. November 17 is the deadline you can also do this online at www.fcgov.com/SP-POLL. The City of Fort Collins is in the process of updating its Strategic Plan for 2018 and wants to get the input of Boards and Commission members about any changes that need to be made. The Strategic Plan is a document that serves as a five year road map that clearly articulates City priorities to the Fort Collins community and will direct the development of the 2019-2020 City of Fort Collins Budget. Your feedback will be reviewed, compiled and used as we move forward into the Budgeting for Outcomes (BFO) process, which emphasizes priorities and results, not just cost. Land Bank Program Presenters: Sue Beck-Ferkiss, Social Sustainability Specialist; sbeckferkiss@fcgov.com or 970.221.6753 and Clay Frickey, City Planner; cfrickey@fcgov.com or 970.224.6045 The Land Bank Program is the only long range affordable housing incentive. The current code allows for 100% Affordable Housing; Affordable in perpetuity; and Specific Area Median Income Levels (50% for rental housing and 60% for home ownership). Staff is recommending changes to provide flexibility; below are the revisions being considered. Proposed Change Why? Allow mixed-use & mixed- income Best Practice and Allows Site Level Considerations Allow Sale or Trade out of program Maximizes Program Effectiveness If Sold - Allow Full Market Value Most Efficient Use of Resource and Leverage Remove Specific AMI Levels Tie to AHSP; Create Sustainable Communities; and still can target lowest possible AMI Proposed Changes Proposed Change Staff Recommendations Allow mixed-use When specifically requested by City as subordinate supportive use Allow mixed-income Only in affordable range - up to 80% for home ownership Consider sale to allow complimenting market rate Allow Sale or Trade out of program If the City determines that all or part of the parcel is no longer appropriate for program. When a parcel has been held at least 10 years, suitability consideration should occur If Sold - Allow Full Market Value Yes – with proceeds used to buy more land Remove Specific AMI Levels For HO - Tie to AHSP (up to 80%); For rental – leave current language Modify Reverter Language Add Notice and Opportunity to cure for; 1). Reverter for failure to commence or 2). change of use Consider specific LUC code modifications be established for Land Parcels Long term goal – Implementation stage Conditions that would suggest a parcel is no longer good for Land Bank Program are; saturation of affordable housing; size; failure of amenities to materialize; permanent development impediments; and RFP issued without response. Purchase considerations are; a willing seller; cost does not exceed fair market value; and Currently or will be within ½ mile of at least 3 of the following: 1. Transit Rout 2. School 3. Park 4. Employment Center 5. Commercial Center Located in City Growth Management Area Community Trust Initiative Janet Freeman, Equity and Inclusion Coordinator Began work in the Spring of 2017 with stakeholder engagement September 13 and Council Resolution 2017-091 adopted on October 3, 2017; which rescinds Resolution 2006-085 and directs the City Manager to create a task force regarding Immigrant Communities. The Community Trust Ordinance Prohibits: 1. Discrimination based on citizenship status 2. Forbids inquiries into immigration status, citizenship status or country of origin from city staff 3. Staff cannot stop, question or detain based solely on country of origin perception, suspected status, race or religion 4. Staff will not perform work of immigration agents Task force will deliver a report to the City Manager to review May 2018. The Task Force will provide recommendations on a communication plan to inform the public about the City’s policies; engage immigrant communities; listen to understand fears; and address fears through education; outreach; services; programs; and partnerships. 1 | Page MINUTES CITY OF FORT COLLINS AFFORDABLE HOUSING BOARD Date: Thursday, December 7, 2017 Location: Community Room, 215 North Mason Street Time: 4:00–6:00pm For Reference Diane Cohn, Chair Ken Summers, Council Liaison Sue Beck-Ferkiss, Staff Liaison 970-221-6753 Board Members Present Board Members Absent Diane Cohn Catherine Costlow Jeffrey Johnson Eloise Emery Curt Lyons Jen Bray Kristin Fritz Staff Present Sue Beck-Ferkiss, Social Policy & Housing Project Manager Clay Frickey, City Planner Brittany Depew, Admin Assistant/Board Support Guests Chadrick Martinez, Housing Catalyst Joe Rowan, Funding Partners Dhara Rose, Senior Advisory Board Dale Adamy Eric Sutherland Kimberly Baker Eleen Baumann Call to order: 4:03 2 | Page _________________________________________________________________________________ AGENDA ITEM 1: Land Bank Program Policy Refresh: Clay Frickey—City Planner, Community Development & Neighborhood Services Affordable Housing defined by Fort Collins as dwelling unit for rent or purchase for households earning 80% or less of the Area Median Income (AMI). Current Land Bank target for rentals is 50% AMI and for homeownership is up to 60% AMI, designed to serve lower-end of affordable range. For Land Bank program, the City buys parcel at low value and, when appropriate, sell to housing developer to create affordable housing units. Started in 2001, five parcels purchased between 2002- 2006, 2016 RFP process to sell parcel on Horsetooth, 2017 sale completed. Recommendations to refresh this program came out of the Horsetooth process and will be the first holistic review of entire process since created. Current program requires 100% affordable housing, affordable in perpetuity, and specific AMI levels (50% rental, 60% homeowner). Changes may be needed for increased flexibility. Considerations when looking at purchasing parcels: Cost cannot exceed fair market value, must be willing seller, located in City growth management area, and must be within .5 mile of at least 3 of the following: transit route, school, park, employment center, and commercial center. To sell parcel, must confirm there is a verifiable need for vacant land, sell for no less than purchase price, and infrastructure improvements to develop property must be minimal. Proposed changes: • Allow mixed-use o Pros: Greater range of housing types, compact walkable and bikeable developments o Cons: More development risk since both commercial and residential elements must succeed, could lead to fewer units since space needed for retail • Allow mixed-income but only within affordable range o Pros: Range of incomes accommodated, higher rents on some units help community o Cons: Fewer very low income units • Allow for parcel to be sold or traded out of program if the land is no longer appropriate for the program. Reasons may include: amenities required don’t materialize, permanent development impediments, saturation of affordable housing, RFP issued with no response, etc. o South College parcel may no longer be appropriate due to being land locked and surrounded by lots of affordable housing development. Area may be too saturated. • If sold—allow market value (right now capped at 90% of full market value) • Remove specific AMI levels (for homeownership: tie to Affordable Housing Strategic Plan, currently up to 80% AMI , and for rental: leave current language) • Make reverter if developer fails to timely develop parcel (add notice and opportunity to cure to reverter provisions—currently, no opportunity to remedy before returning to city) • Consider specific Land Use Code modifications be established for Land Bank parcels (for example, allowing 16 units/acre in LMN zones that currently only allow 12) Comments/Q&A • Eric Sutherland: What about water tap fees? Has a Water Bank ever been considered? o Clay: We have talked about a Water Bank, and that’s been part of the conversation. That’s been a huge impediment, but nothing has come of it yet. • Eric: Has the Poudre School District ever engaged in this affordable housing conversation? 3 | Page o Sue: We have had discussions with them and we continue to. Like other large employers in the community, they are starting to consider their role in this. • Joe Rowan, Funding Partners: Is there a reason you wouldn’t use the same math to get to income averaging for homeownership? So 80% for homeownership is averaged across the community? o Clay: We haven’t spent a lot of time discussing income averaging. If we average at 80%, some would need to be more than that which would go against our definition of affordable housing. o Joe: Is there a way to subdivide parcels? This might be necessary when looking at mixed use. o Clay: That’s what we’re talking about when we say sell out of the program. We could sell part for retail development and retain rest for affordable housing. o Kristin: But what if you want to develop in pieces? Subdivide and develop as you go. o Sue: I think we have that ability now. We can subdivide now but it has to be used 100% for affordable housing. This change would not require 100% affordable housing on each parcel. o Joe: It may not be a good idea to have 100% of a project at 80% AMI, and mixed use/mixed income could create more community vibrancy. • Eleen Baumann: Isn’t it better to have saturation of affordable housing rather than no expansion of affordable housing? I’m concerned about increasing home prices and lack of affordability as Fort Collins continues to see the population increasing. o Clay: In terms of affordability, and influx of people moving here, that’s absolutely part of the conversation. The median home price is around $330k and that was in the $200ks just 5 years ago. Anecdotally, looking at downtown Denver, vacancy rate was below 2% and now they’re moving closer to 10% as new apartments are built and offering incentives. Here, theoretically, as we add to our current 65k housing units, that would assume a decrease in prices, but that’s based on some factors we can’t control or foresee. • Eleen: When talking about homeownership, what housing types is that focused on? Single family, condos, a mix, etc.? It seems like $205k for building costs could be possible for smaller units. o Clay: Each time an RFP is issued, we can specify what type of housing we’re looking for, and typically it’s a range. We’ll need a developer to come forward with a proposal that works. We can ask for it, but it doesn’t mean it’ll come to fruition. • Eleen: I’d also rather not see the parcel on South College sold without another parcel being purchased that meets those needs. • Chadrick Martinez, Housing Catalyst: I think mixed-use is something we should be considering. As Fort Collins pushes on the urban growth boundary and we get more dense, mixed-use could help introduce amenities to communities that don’t have them. Putting grocery stores in food desert areas, for example. In terms of mixed-income, it could provide a healthier mix for a neighborhood. Sell and trade should be a viable opportunity considering the south College parcel. When working with the City on Horsetooth property, it was very difficult to get low AMI units the way we did. We used flood money, proceeds from sales, housing vouchers. We threw everything we had at getting to those low AMIs. We brought tools to the table that others may not have. I think you need to open up to the 60% to reach the audience that’s there. • Dhara Rose, Senior Advisory Board: One of the issues is the increase in 55+ population. We all know healthy communities have people of all ages and backgrounds living together. In the 4 | Page proposed change, when considering allowing mixed income, could it take into consideration seniors as part of the analysis of how you’re deciding who can apply? o Clay: That could be addressed through either land use or the RFP itself, specifically seeking certain type of housing that considers seniors. o Sue: I would add that our communities now do provide housing for seniors, some exclusively, but some not. Very often they’re able to meet the lower income requirements. o Beth Rosen: In the Affordable Housing Strategic Plan, which is updated every 5 years, seniors and vulnerable populations are mentioned as populations that have specific housing needs, so that proposed change would help ensure a focus in keeping seniors front and center. o Dhara: Not just allowing seniors, but considering them specifically in the design of the building themselves. To help seniors age comfortably in place. • Chadrick: In the LMN zones 12-units per acre, I think that’s an antiquated requirement. Having higher density would be helpful in decreasing development costs. I don’t believe those density requirements have been revisited in a long time. o Clay: Those requirements used to be even more strict, but as we update the City Plan, this is something we’re definitely looking at. o Chadrick: I think it has to do with design. You can create a design that fits in the community. Having to do multiple buildings to maintain density requirements is more expensive. • Jen: To clarify, is there specificity today or in updates regarding only buying vacant land? o Sue: Some parcels are vacant and some are not. One has a farmhouse on it and we’re asking for historic review. o Kristin: There’s nothing that disallows purchasing a parcel that has buildings on it? o Clay: No. And we don’t pay taxes while we own it, but it is more expensive to buy land with any dwellings on it. • Curt: Realistically, what other parcels are being considered? o Sue: We are currently in negotiation for a big property. We have money in the bank from Horsetooth but we acknowledge that it’s not easy to secure good, feasible land. • Kristin: Because we have LMN on almost every Land Bank site, I think the idea of saying go up to 16-units in LMN zoning is critical and I don’t think we should wait for City Plan updates to make that change. Something that allows higher density for Land Bank is an important change. o Diane: It’s almost a testing ground for how we might address density or zoning for affordable housing overall if we start with these particular plots of land. It’s a way to do a test case. Can we do increased density without feeling like we have giant walls and huge buildings that don’t fit in the neighborhood? o Kristin: There are so many protections in land use code that, even at 16 units per acre, you’re not going to get these terrible scary buildings. The fear that higher density will lead to a higher impact product, I think the City can use its standards and codes to get the quality of buildings we want. There’s a higher scrutiny for building on Land Bank properties. The City has more control than over a typical affordable housing development. o Sue: I don’t see how there would be fewer buildings if we allowed 16 building per acre? o Kristin: Right now it’s 12 units per building and 12 buildings per acre. So both of those would need to change. 5 | Page o Diane: I don’t see that up there. It mentions density but not number of buildings specifically. o Clay: It was intentionally broad due to all of our parcels currently being in LMN zones. There are caps on units per building, buildings per acre and square footage. Moving forward, when looking to buy, we don’t have to buy LMN, it’s just been the case so far. There are a lot of other zone districts that don’t have these restrictions. o Diane: So we’re not talking about changes to density in a particular zone? We’re talking about changes to Land Bank parcels separately? o Sue: At this time. o Kristin: It’s saying Land Bank parcels in the LMN zone. o Sue: The way I see this going is hopefully we would go forward with changing the code and then we would follow up with land use standards. Council can’t do that on its own. It goes through a lot of different people in that process. o Clay: We would probably need a Council directive to do that. o Kristin: Don’t these changes also have to go to Council? o Clay: Yes. • Curt: I’m really happy to see changes considered about mixed-use. I think allowing higher density would help with concerns about losing housing space to retail. o Jen: The mixed use should be a complement to the community in which it’s being developed. o Kristin: I agree. When the RFP goes out, it should say we will consider mixed use but it has to, at minimum, meet affordable housing requirements. o Sue: We would only allow it to be accessory use, not primary. It would have to be affordable housing primarily. o Diane: With Land Bank properties only, not other affordable housing developments, I feel unsure about retail space. o Kristin: It doesn’t have to be commercial. It could be office space or a library, for example. o Diane: I’m just unsure specific to Land Bank. Clearly there is some need for retail, specifically grocery stores, around South College parcel, but these properties are designed for affordable housing, and I have a reaction to non-residential uses. o Eloise: You want to use 100% of the property for affordable housing only? o Diane: As a City, we created this program specifically because of the need for affordable housing. I don’t think for every affordable housing project, but Land Bank is designed to protect something really important here. o Curt: When I picture a grocery store, I don’t see a huge north side King Soopers. o Diane: Do we get to have a say what non-residential goes there? o Sue: The code would be more broad but the RFP could be more specific. o Jen: From a lending perspective, you do hit some challenges in residential funding once you add commercial to the development. But that is specific to homeownership. o Kristin: We are not alone in this issue. Denver has a similar program but language says “must have affordable housing component.” The intention of that program is affordable housing, but their language is more general. I don’t believe that allowing for mixed use will take away affordable housing potential, as long as that’s the forefront of the RFP. o Curt: Coming from someone at Housing Catalyst, that carries a lot of weight for me. 6 | Page o Kristin: And it would be more challenging for us, for sure. But it could be great for the community. o Sue: We could include it in an RFP, or we could sell a portion off specifically for commercial. o Kristin: The downside of that, for me, is that the City is deciding that, rather than a developer with the experience to see what make the most sense. • Sue: We are making the recommendation to include mixed-use. In terms of mixed-income, we had a lot of public input that felt very comfortable subsidizing housing above 80%. People are feeling like if the best use of this parcel would be market rate, we would chop it up and sell at market rate. o Diane: My challenge is that there’s stigma about fully affordable housing developments, but as soon as you want to create mixed-income, there’s a backlash. o Curt: But that’s how you create successful communities. o Eloise: How do you define that? o Curt: Happy residents, and healthy, diverse economy. Neighborhoods like that don’t become swaths of gated communities and chunks of all affordable housing developments. o Sue: Those are called complete communities. o Clay: I think a lot of people looking for homes want that, but I don’t know if that’s how development is going. o Sue: But Diane’s point about this being a unique program that requires unique requirements is a good one. o Kristin: I think limiting to 50% is really difficult. It’s hard to achieve that, and I don’t know if that limit is going to help the program overall. Are we best serving our community at 50%? I think we should be flexible to make sure we’re best serving our community. Developers read an RFP and they’ll do what they can to win the project. o Sue: I think the reason the staff recommendation is 50% is twofold: 1) Housing Catalyst came to us last year and said it would help them and thought it would help other developers as well, and 2) PedCor came in at 60% across the board without any real help, so the market in the case was able to do it. We’re trying to keep this where the market can’t do it. They didn’t use any of our incentives at all and were at 60%. o Diane: I think the mixed income request is perfectly reasonable. Not limiting to 50% makes sense. o Sue: Other communities define affordable housing separately for homeownership and rental. In our plan, we have everything up to an affordable 80%. Staff is not really comfortable with 80% for rental units in Land Bank. While tax credits will fund 80%, there are ways to fund without tax credits. o Diane: If the majority of affordable housing developers feel comfortable at 60% for rental, that seems reasonable to me. They know what they need to make a project come together. o Jen: It sounds like within the RFP you can specify that you’re looking for a mixed number. o Kristin: Because a lot of these solutions are coming through the RFP process, who’s doing that? Where is that direction coming from? o Sue: That’s why the code has to set the standards and create guide posts. And then it’s up to staff to create reasonable RFPs. The RFP process is pretty detailed. o Clay: We talk about priorities with the team, and the Affordable Housing Strategic Plan guides us as well. 7 | Page o Kristin: What do you think about this board having some review of the RFP process? o Sue: Last time, the RFP was somewhat rushed because our partners wanted to go after disaster relief funding. We had qualifying proposals but the one we liked the best required a tweak of the code. o Kristin: I don’t mean being part of the whole RFP process, but just overall higher- level feedback about what the RFP should include. • Kristin: I feel like the proposed changes are very short, and I don’t know if the actual changes are more detailed or specific. Should we create comments that are broad or more specific? o Diane: Can we look at each recommendation and discuss it briefly? To see if we can come to a specific consensus. o Sue: You can issue a recommendation to Council, or you can have a discussion now and ask a board member to create a memo and bring back for further discussion. o Kristin: Are these recommendations moving forward or are these open to change? o Sue: These are open to change. This is what staff is considering but it’s not our official recommendation yet. o Diane: So we don’t need anything formal at this point, just see if we can come to a general agreement. • Diane: Allow mixed use. Generally I hear the board is in favor of that. o Eloise: But I also hear what you’re saying, that the Land Bank was created specifically for affordable housing. o Kristin: With the caveat that we’d allow mixed use with significant affordable housing element. o Diane: And I’m comfortable with that. o Jeff: And it does say, “When requested by the City.” • Diane: Allow mixed income. Let’s discuss allowing it in general and then get into the details. o All: Yes to mixed income. o Jen: Homeownership to 80% is a no-brainer. o Diane: For rental, do we want to say 60%? Can you talk about the staff perspective? o Sue: We did struggle with this one and we did talk about 60%. At the staff level, we felt like developers with our normal incentives are meeting 60%, and since the Land Bank is unique, maybe we push it and require those lower units. The concern was that the intention of Land Bank was to go as low as we can. We really didn’t think 100% of units at 60% is where this program is at. o Kristin: I would suggest to staff that it get raised to 60%. o Jen: I like 60%. o Diane: Me too. o Sue: If we did 60%, but we strongly encourage developers to have a mix, we might end up closer to 50% overall anyway. o Kristin: We have a real shortage of 60% units in this community. Every single one we can get at 60% is critical. o Jen: Based on changing economic conditions, we can also issue an RFP at 50%. • Diane: Allow sale or trade out of program. o All: Yes. o Curt: Assuming the parcel just won’t work? o Diane: Yes. o Jen: As long as those funds remain for affordable housing. 8 | Page • Diane: If sold out of the program – allow full market value. o Sue: The reason we didn’t want to sell for more than 90% is to keep 10% as a subsidy. o Diane: I’d like to see some more clarity in this language. • Diane: Remove specific AMI levels. We’ve pretty much already talked about this one. • Sue: Next is the reverter. This is kind of a technical thing. What we want is to give the option to cure. o Kristin: Not having this is a big problem for investors. They want to know that if something happens, they will have the chance to remedy. o Sue: This is something we think is a good improvement. • Diane: Consider specific Land Use Code modifications be established for Land Bank parcels. o Sue: We could really use help with how to sell this one to Council. o Kristin: You want specifics on changing to 16 units per acre? o Sue: I don’t think we can do that. It will be a more general statement that staff is looking at changing density or design standards. o Jeff: Do you need to make this change now? I’m all for 16 units per acre, but a special exception for City properties is a real challenge. o Jen: I think it’ll be a bigger discussion about how this can happen without it seeming like the City is trying to create special rules for its own properties. o Jeff: I’m just wondering if this is necessary? I worry Council will be hung up on this. o Kristin: What if it’s left in with vague wording? o Diane: Like “density and design standards to be considered moving forward.” o Clay: For the planning department perspective, I think there will be people who will want to wait to make code changes until City Plan is complete. o Diane: I would like to see that the next time we sell a Land Bank property, we do have the option to create a higher density development. o Sue: And you can always ask for a modification for a specific project. o Kristin: It’s tough, though. o Diane: Maybe this a bigger question about why there is so much LMN zoning currently in the city, given the housing climate. o Sue: I think density is the buzzword, and even council members are talking about increasing density. If we weren’t able to increase density, but we could put 16 units in a building, it doesn’t necessarily maximize the property, but it does help our developers reduce some costs. Meeting Adjourned: 6:15 Next Meeting: January 4 1 February 20, 2018 Affordable Housing Land Bank Sue Beck-Ferkiss and Clay Frickey ATTACHMENT 7 Fort Collins Affordable Housing Land Bank • Only long range affordable housing incentive • Proactive not reactive • Holds locations for future affordable housing community • Locks in price • Provides good distribution ©Copyright 2014 City of Fort Collins. All Rights Reserved 2 Policy Refresh 3 Plan and Strategy Alignment CITY PLAN CITY STRATEGIC PLAN AFFORDABLE HOUSING STRATEGIC PLAN History of Program 5 Process to Sell 6 Dev. Rev. RFP • Select parcel to deploy • Competitive process to chose partner • Contract for sale with conditions • Full development review process Sale • Only after the development has all approvals, does sale become final Dev. Rev. 7 Land Bank Parcels Strengths of Current Land Bank Program • Focus on providing affordable housing • Affordable in perpetuity • Proactively preserves opportunity • Ensures good distribution throughout City 8 Purchase Considerations  Willing Seller  Cost does not exceed fair market value  Currently or will be within ½ mile of at least 3 of the following: 1. Transit Rout 2. School 3. Park 4. Employment Center 5. Commercial Center  Located in City Growth Management Area 9 Sales Considerations Code: • 100% Affordable Residential • Specific AMI levels per tenure • Sell for no more than 90% of fair market value Policy • Verifiable need for developable land • Appreciation value allows sale for no less than purchase price • Minimal infrastructure improvements needed 10 Proposed Changes 11 Proposed Change Staff Recommendations Allow mixed-use When specifically requested by City as subordinate supportive use Allow Sale or Trade out of program • Yes – upon a determination by the City that all or part of the parcel is no longer appropriate for the program. • When a parcel has been held at least 10 years, suitability consideration should occur If Sold out of program- Allow Full Market Value Yes – with proceeds used to buy more land Remove Specific AMI Levels For HO - Tie to AHSP, currently up to 80% AMI - Specify 60% maximum for rental housing Soften Reverter Language Add notice and opportunity to cure to reverter provisions Consider specific LUC code modifications be established for Land Bank Parcels Long term goal – Implementation stage -1- ORDINANCE NO. 037, 2018 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING ARTICLE XIII OF CHAPTER 23 OF THE CODE OF THE CITY OF FORT COLLINS REGARDING THE LAND BANK PROGRAM WHEREAS, on April 17, 2001, the City Council adopted Ordinance No. 048, 2001, enacting Article XIII of Chapter 23 of the City Code regarding land banking; and WHEREAS, the purpose of the land bank program is to enable the City to acquire, hold and sell real property to assist housing providers in providing affordable rental and homeownership housing for low-income residents; and WHEREAS, on April 5, 2016, the City Council adopted Ordinance No. 034, 2016, which amended Section 23-354 of the City Code to provide some flexibility in income targets for the land bank program and facilitate the development of the land bank parcel on Horsetooth Road; and WHEREAS, in 2016 the City Council also directed City staff to conduct a comprehensive review of the land bank program and recommend updates; and WHEREAS, as a result of that review, staff is recommending amendments to the land banking Code provisions to: • clarify the City’s ability to dispose of land bank parcels that turn out to not be appropriate for development of affordable housing, • allow mixed use development under certain conditions, • modify the affordability restrictions on properties sold for affordable housing, • create a notice requirement before property that has not been developed in accordance with the requirements of the land bank Code provisions reverts to the City, and • clean up references to the affordable housing trust fund, as there is no such fund; and WHEREAS, City staff also plans to develop possible changes to the City’s Land Use Code to create program-specific incentives and design standards to maximize the development potential of the land bank properties; and WHEREAS, the City Council believes that the proposed amendments to the City Code are in the best interests of the City. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the City Council hereby makes and adopts the determinations and findings contained in the recitals set forth above. Section 2. That Section 23-350 of the Code of the City of Fort Collins is hereby amended to read as follows: -2- Sec. 23-350. - Purpose. The purpose of this Article is to enable the City to acquire, hold and sell real property for the purpose of to assisting housing providers (whether publicly affiliated, philanthropic or profit- motivated) in providing affordable rental and homeownership housing for households at or below fifty (50) percent of the area median income for Fort Collins ("AMI") and homeownership housing for households at or below sixty (60) percent of AMI. This Article will assist the City in providing land that developers can feasibly purchase for affordable housing; will help to ensure that appropriate sites are available in the future for the development of such housing; will assist in the early identification of sites for affordable housing development so that adjacent property owners will be aware and accepting of the plans for such sites; and will systematically secure affordable housing sites so that such developments can be dispersed throughout the community by strategically selecting sites for affordable housing projects in desirable locations. Section 3. That Section 23-352 of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 23-352. - Criteria. The City Manager shall acquire land under the authority granted in § 23-351 only if the acquisition complies with the following criteria: (1) The land is acquired from a willing seller (without the threat of condemnation). (2) The cost of acquiring the land does not, in the opinion of the City Manager, exceed the fair market value thereof. (3) Either at the time of acquisition the land is, or within the reasonably foreseeable future in the judgment of the City Manager, the land within ten (10) years likely will be, within one-half (½) mile of at least three (3) of the following five (5) existing or planned facilities: a. Transit route; b. School; c. Park; d. Employment center; and e. Commercial center. (4) The land is located within the Fort Collins Growth Management Area. Section 4. That Section 23-353 of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 23-353. - Funding. -3- The acquisition of land pursuant to this Article shall be funded from the Affordable Housing Trust Fund, the General Fund, or other available funding source. Section 5. That Section 23-354 of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 23-354. - Disposition of land bank property. In addition to the criteria established for the disposition of property in Article IV of this Chapter, no property or portion of a property acquired pursuant to this Article shall be sold by the City except in accordance with the following criteria: (1) Any disposition/sale of such property shall be to a housing provider legally bound to the City under the terms of such sale to provide, as the sole development purpose, "affordable housing", to be defined in accordance with stated objectives from the City’s Affordable Housing Strategic Plan, and with the following restrictions, defined as: a. Rental housing shall be restricted to for households at or below fifty sixty (5060) percent of AMI,. except that rental housing may be provided for households at up to sixty (60) percent of AMI so long as the average affordability of all rental housing developed on such property shall not exceed fifty (50) percent of AMI; and/or b. Homeownership housing shall be restricted to for households at or below sixty eighty (6080) percent of AMI. Such sale shall not be made to any person for the purpose of land speculation or appreciation, for the development of market rate housing, or for the development of nonresidential uses or the provision of market rate housing unless the City requests that the development include specific non-residential, secondary supportive uses. (2) Notwithstanding the requirements of subsection (1) above, the City may sell or trade property acquired pursuant to this Article for purposes other than affordable housing if the City Council, in its sole discretion, determines that the property is no longer appropriate for the land bank program because: a. an affordable housing project on the property is not supported by a market study obtained by the City; b. at least three (3) of the facilities described in Section 23-352(3) do not exist within ten (10) years of acquisition of the property; c. the City has not received a satisfactory response to a request for proposals to develop the property; or -4- d. the property is too difficult or costly to develop as affordable housing due to the size, location, physical condition or other limitations on the property. (3) Upon acquisition of the property from the City, the housing provider shall commence development of all housing within twenty-four (24) months of having acquired the land and shall obtain building permits for the construction of all such housing units within forty-eight (48) months of acquisition of the property. If all such building permits have not been obtained by the housing provider within the aforesaid periods of time, then title to that portion of the property for which building permits have not been issued shall revert to the City, provided that the City shall first give notice to the housing provider and any lenders of record of any violation of this requirement and allow a period of not less than sixty (60) days to cure the violation. Said possibility of reverter shall be contained in any deeds conveying said land to such housing provider. Any extension of the aforesaid periods of time shall be valid only if approved by the City Manager upon finding that the housing provider has exerted a good faith and diligent effort in pursuing the development but has suffered delays caused by unforeseen circumstances not reasonably within the control of the housing provider. (34) If any property sold by the City for affordable housing under the authority of this Section is subsequently resold by the original housing provider, the purchaser and any subsequent owners of such property must continue to use such property for affordable housing. If said property is ever not so used, then the City may re-enter and recover title to all such property, provided that the City shall first give notice to the record owner of the property and any lenders of record of any violation of this requirement and allow a period of not less than sixty (60) days to cure the violation. The deed conveying the property from the City to such housing provider shall contain such right of entry for condition broken, which provision shall run with the title to the property. (45) All land conveyed to a housing provider by the City pursuant to this Article shall be sold to such housing provider at no more than ninety (90) percent of its fair market value as determined by the City. Land sold out of the land bank program pursuant to subsection (2) above shall not be subject to this requirement. Section 6. That Section 23-355 of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 23-355. - Proceeds of sale. All proceeds of any sale of land in accordance with § 23-354 shall be returned to the affordable housing trust fund to be used for additional land acquisitions in accordance with this Article. -5- Introduced, considered favorably on first reading, and ordered published this 20th day of February, A.D. 2018, and to be presented for final passage on the 6th day of March, A.D. 2018. __________________________________ Mayor ATTEST: _______________________________ City Clerk Passed and adopted on final reading on the 6th day of March, A.D. 2018. __________________________________ Mayor ATTEST: _______________________________ City Clerk