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HomeMy WebLinkAboutCOUNCIL - COMPLETE AGENDA - 01/22/2019 - ADJOURNED MEETINGCity of Fort Collins Page 1 Wade Troxell, Mayor City Council Chambers Gerry Horak, District 6, Mayor Pro Tem City Hall West Susan Gutowsky, District 1 300 LaPorte Avenue Ray Martinez, District 2 Fort Collins, Colorado Ken Summers, District 3 Kristin Stephens, District 4 Cablecast on FCTV Channel 14 Ross Cunniff, District 5 and Channel 881 on the Comcast cable system Carrie Daggett Darin Atteberry Delynn Coldiron City Attorney City Manager City Clerk Adjourned Meeting January 22, 2019 6:00 PM Persons wishing to display presentation materials using the City’s display equipment under the Citizen Participation portion of a meeting or during discussion of any Council item must provide any such materials to the City Clerk in a form or format readily usable on the City’s display technology no later than two (2) hours prior to the beginning of the meeting at which the materials are to be presented. NOTE: All presentation materials for appeals, addition of permitted use applications or protests related to election matters must be provided to the City Clerk no later than noon on the day of the meeting at which the item will be considered. See Council Rules of Conduct in Meetings for details. The City of Fort Collins will make reasonable accommodations for access to City services, programs, and activities and will make special communication arrangements for persons with disabilities. Please call 221- 6515 (V/TDD: Dial 711 for Relay Colorado) for assistance.  CALL MEETING TO ORDER  ROLL CALL 1. Oath of Office for Susan Gutowsky, Appointee to Council District 1 Seat. 2. Council will Consider a Possible Motion to go into Executive Session  OTHER BUSINESS  ADJOURNMENT City of Fort Collins Page 1 Wade Troxell, Mayor Council Information Center (CIC) Gerry Horak, District 6, Mayor Pro Tem City Hall West Susan Gutowsky, District 1 300 LaPorte Avenue Ray Martinez, District 2 Fort Collins, Colorado Ken Summers, District 3 Kristin Stephens, District 4 Cablecast on FCTV Channel 14 Ross Cunniff, District 5 and Channel 881 on the Comcast cable system Carrie Daggett Darin Atteberry Delynn Coldiron City Attorney City Manager City Clerk The City of Fort Collins will make reasonable accommodations for access to City services, programs, and activities and will make special communication arrangements for persons with disabilities. Please call 221-6515 (V/TDD: Dial 711 for Relay Colorado) for assistance. City Council Work Session January 22, 2019 (After the Adjourned Council Meeting, which begins at 6:00 PM)  CALL TO ORDER. 1. Keep Fort Collins Great Sunset. (staff: Ginny Sawyer, 10 minute presentation; 45 minute discussion) The purpose of this work session is to present Council with options for renewing/maintaining Keep Fort Collins Great revenue once the 0.85 tax sunsets on December 31, 2020. April 2019 is the anticipated election for a potential ballot related question to address funding needs. 2. Occupancy Study. (staff: Ginny Sawyer, 20 minute presentation; 60 minute discussion) The purpose of this item is to present and review the report and findings from the Occupancy Study. 3. Outdoor Residential Wood Burning. (staff; Cassie Archuleta, 15 minute presentation; 45 minute discussion) The purpose of this item is to discuss a regulatory option to support a goal of allowing wood burning fires in residential areas that do not negatively impact neighbors. Periodically, the City and Poudre Fire Authority (PFA) are contacted regarding nuisance, health and safety concerns from wood smoke in residential areas. This item was identified as a Council priority May 2017, and staff received direction October 2018 to develop a regulatory option that did not ban residential wood fires, but still addressed fires that negatively impact neighbors. Additional direction will be sought regarding adoption of a permit system that allows outdoor residential wood burning with a permit, where permit conditions are designed to mitigate potential smoke impacts on neighbors.  OTHER BUSINESS.  ADJOURNMENT. DATE: STAFF: January 22, 2019 Ginny Sawyer, Policy and Project Manager WORK SESSION ITEM City Council SUBJECT FOR DISCUSSION Keep Fort Collins Great Sunset. EXECUTIVE SUMMARY The purpose of this work session is to present Council with options for renewing/maintaining Keep Fort Collins Great revenue once the 0.85 tax sunsets on December 31, 2020. April 2019 is the anticipated election for a potential ballot related question to address funding needs. GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED 1. Which revenue replacement option would Council like to move forward? 2. If Option B, what should be the length of the term? BACKGROUND / DISCUSSION Since 2011, KFCG has funded basic operations and enabled the City to both maintain a desired level of service and respond to community desires in an environment of population growth and annual inflation. The revenues from this tax are, by ballot, distributed to the following areas: 33% Street Maintenance and Repair 17% Other Transportation Needs 17% Police Services 11% Parks and Recreation 11% Other Community Priorities 11% Poudre Fire Authority Prior to the 2020 sunset of KFCG, and before building the 2021-22 budget, the City has been engaging the community in the decision of how to fund current service levels or make alternative plans for a lower service level at a lower cost. If the desire is to replace KFCG funds in full this can be achieved through a dedicated tax, an increase to the on-going base rate, or a combination of these. If City Council or the community decide NOT to replace KFCG revenue in full then reduced levels of service will need to be identified during the 2020 budget process for 2021-22 budgets. Options The following two options are being brought forward following a year-plus process that included Council Finance meetings, Council meetings, public meetings, and interaction with 18 City Boards. 1 Packet Pg. 2 January 22, 2019 Page 2 Option A - Increase the City base sales tax rate by 0.85%. This option would be a one-time vote to increase the base rate tax by 0.85%. This revenue would be general fund revenue and would be prioritized and allocated by Council and the community to address needs and desires through the budgeting process. Option B - Increase the City base sales tax rate by 0.60% and put forward a 0.25% renewable tax. This option includes a one-time vote to increase the base sales tax by 0.6% and a vote to consider a 0.25% dedicated, renewable tax. The 0.6% amount covers all but 0.01% of current level KFCG contributions for Police, Streets, Fire, and Parks and Recreation programs and services. To maintain existing KFCG programs and services, the remaining 0.25% tax would support “Other Transportation” and “Sustainability” programs and services. Ballot Language Both options would include ballot language to honor and continue to provide funding for Fire Protection and Emergency services at an 11% of 0.85% amount. Neither option would result in an increase to tax on groceries or prescription drugs. The current 0.85 tax exempts manufacturing and current ballot language will reflect the same exemption. Both options would trigger TABOR election notice requirements. Outreach Staff has been heavily engaged in public outreach on this topic. Specific outreach has included: Boards and Commissions Business/Community Groups Other Meetings • Economic Advisory Commission • Women’s Commission • Golf Board • Parks and Recreation Board • Zoning Board of Appeals • Downtown Development Authority • Air Quality Board • Transportation Board • Housing Catalyst Board • Affordable Housing Board • Campus West Merchants • UniverCity Connections • Visit Fort Collins Board • North Fort Collins Business Association • Fort Collins Chamber Legislative Committee • Downtown Business Association (Board & Members) • Leadership Fort Collins • Six open meetings (one in each Council district) • Three open meetings for CityWork Alumni • Poudre Fire District Board • Coloradoan Editorial Board • January 10, 2019 open meeting 1 Packet Pg. 3 January 22, 2019 Page 3 • Land Conservation and Stewardship Board • Senior Advisory Board • Youth Advisory Board • CDBG Commission • Commission on Disability • Planning & Zoning Board • Natural Resources Board • Landmark Preservation Commission All of these events have included background information and varying data related to KFCG and City and financial information over time. The general questions put to these groups focused on “do residents like the current level of service they experience, and do they feel the service is provided at the right price.” Discussions also focus on the functions and specifics of base rate and dedicated taxes. In general, feedback highlights include: • Overall support for replacing most if not all revenue. • Some trepidation of losing dedicated funding for particular services but an understanding that greater flexibility in funding could be a benefit. • Encouragement to keep the ballot and ballot language as simple as possible. • Overall support for an increase to the base rate (particularly to cover police, streets, and fire.) • City revenue and expense is a challenging conversation for the public to be able to provide specific revenue options. • Majority like level of service with limited suggestions for where to reduce. Next Steps • February 5 regular meeting- Last day to refer language for April 2019 election. ATTACHMENTS 1. January 2, 2019 Work Session Summary (PDF) 2. Description of Ballot Options A and B (PDF) 3. PowerPoint Presentation (PDF) 1 Packet Pg. 4 ATTACHMENT 1 1.1 Packet Pg. 5 Attachment: January 2, 2019 Work Session Summary (7570 : Keep Fort Collins Great Sunset) 1.1 Packet Pg. 6 Attachment: January 2, 2019 Work Session Summary (7570 : Keep Fort Collins Great Sunset) 1.1 Packet Pg. 7 Attachment: January 2, 2019 Work Session Summary (7570 : Keep Fort Collins Great Sunset) DRILLING PLATFORMS - FUNDED OFFERS All KFCG OCP and OT goes away = $6.9M ongoing and $1.2M one-time as of 1/3/2019 entire offer is eliminated reduction amount funding for offer is reduced Rank Offer # - Offer Description FTE Offer Type Offer Total General Fund Ongoing General Fund 1-Time & Reserves KFCG Dedicated KFCG OCP KFCG OT Other Notes / Funds included in "Other" Ongoing One-Time Total NEIGHBORHOOD LIVABILITY & SOCIAL HEALTH 1 42.1 - Social Sustainability O 1,659,853 1,091,806 0 568,047 2 66.1 - Neighborhood Programs and Services O 1,683,469 1,503,388 100,000 80,081 3 65.1 - Development Review Programs and Services O 6,743,330 5,634,562 0 101,000 1,007,768 806K Trans, 202k Data & Comm 4 53.1 - Low Income, Senior and Disabled Rebate Programs O 269,500 269,500 0 0 5 37.1 - Graffiti Abatement Program O 144,077 144,077 0 0 6 66.2 - Larimer Humane Society Contract O 830,000 682,330 147,670 0 7 89.1 - West Nile Virus Management Program O 359,081 0 0 359,081 359,081 0 359,081 8 48.1 - ENHANCEMENT: Poudre School District After-School Programs for Title 1 Schools E 75,000 75,000 0 0 75,000 0 75,000 10 42.6 - ENHANCEMENT: Homelessness Initiatives E 294,000 50,000 244,000 0 50,000 244,000 294,000 16 65.5 - ENHANCEMENT: Wireless Communications Plan E 50,000 0 50,000 0 0 50,000 50,000 22 65.8 - KFCG ENHANCEMENT: 1.0 FTE Contractual - Historic Preservation Building Survey 1.00 E 89,564 0 0 89,564 89,564 0 89,564 24 42.3 - ENHANCEMENT: Human Services Program Grant Funding E 250,000 100,000 150,000 0 100,000 150,000 250,000 28 89.2 - KFCG ENHANCEMENT: West Nile Virus - Adult Mosquito Treatment Efficacy Study E 20,000 0 0 20,000 0 20,000 20,000 31 42.12 - KFCG ENHANCEMENT: Murphy Center Expansion & Housing Placement System E 88,000 0 0 88,000 0 88,000 88,000 32 65.9 - REDUCTION: -1.0 FTE - Planning Technician & Intern (vacant) (1.00) R (84,475) (84,475) 0 0 Excluded Reduction Offer 33 66.7 - REDUCTION: -1.0 FTE - Compliance Inspector (vacant) (1.00) R (64,505) (64,505) 0 0 Excluded Reduction Offer Funded Subtotal (1.00) $12,406,894 $9,401,683 $691,670 $1,305,773 $1,007,768 $673,645 $552,000 $1,225,645 448,645 CULTURE & RECREATION 1 47.2 - Recreation Activities and Programs O 5,036,682 0 0 1,007,360 0 4,029,322 Recreation Fund 2 47.3 - Recreation Administration and Communication Services O 1,213,849 461,175 0 150,000 0 602,674 Recreation Fund 3 58.3 - Museum of Discovery O 1,074,336 945,801 0 0 0 128,535 Museum Fund 4 58.4 - Gardens on Spring Creek O 1,010,614 810,068 91,000 109,546 0 0 5 29.1 - Parks, Trails and Facility Grounds Maintenance O 7,846,699 6,192,342 283,747 904,716 65,894 400,000 Con Trust Fund 6 47.1 - Ice & Aquatics O 2,718,779 0 0 497,259 0 2,221,520 Recreation Fund 7 28.1 - Memorial Parks O 838,498 153,006 0 103,020 0 582,472 Cemeteries, Perpetual Care 8 49.1 - Cultural Facilities: Utilities and Custodial O 1,809,221 1,809,221 0 0 0 0 10 58.1 - Cultural Services O 4,557,344 1,581,909 0 0 0 2,975,435 Cultural Svcs 11 29.3 - Parks Life Cycle Program O 550,000 0 0 550,000 0 0 12 57.1 - Urban Forest Management O 2,079,565 1,880,452 0 0 199,113 0 15 27.1 - Community Services Administration and Technology Support O 356,635 306,097 0 0 50,538 0 19 29.8 - KFCG ENHANCEMENT: 2.0 FTE - Park Maintenance Workers and DRILLING PLATFORMS - FUNDED OFFERS All KFCG OCP and OT goes away = $6.9M ongoing and $1.2M one-time as of 1/3/2019 entire offer is eliminated reduction amount funding for offer is reduced Rank Offer # - Offer Description FTE Offer Type Offer Total General Fund Ongoing General Fund 1-Time & Reserves KFCG Dedicated KFCG OCP KFCG OT Other Notes / Funds included in "Other" Ongoing One-Time Total TARGET REDUCTION 30 29.6 - ENHANCEMENT: Improving Playground Accessibility for All E 125,000 0 125,000 0 0 0 Skipped due to needing ongoing 33 57.5 - ENHANCEMENT: Forestry Emerald Ash Borer Pre-Infestation Program E 50,000 0 50,000 0 0 0 0 50,000 50,000 46 32.7 - ENHANCEMENT: Poudre River Downtown Master Plan Reach 4 Feasibility Study E 100,000 0 100,000 0 0 0 0 100,000 100,000 53 57.6 - REDUCTION: Forestry Tree Replacement Plantings E (75,000) (75,000) 0 0 0 0 Excluded Reduction Offer 54 47.12 - REDUCTION: -1.0 FTE – EPIC Ice Leader Position (1.00) E (60,177) 0 0 0 0 (60,177) Excluded Reduction Offer 55 47.13 - REDUCTION: -0.50 FTE Recreation Coordinator (0.50) E (46,150) 0 0 0 0 (46,150) Excluded Reduction Offer Funded Subtotal 5.25 $30,699,807 $14,299,056 $974,747 $3,508,858 $315,545 $10,833,631 $233,985 $150,000 $383,985 ECONOMIC HEALTH 3 41.1 - Economic Health Office O 889,156 589,756 0 299,400 0 12 30.1 - Downtown Landscaping and Maintenance O 1,984,941 1,662,961 38,000 228,980 55,000 GID 228,980 0 228,980 14 67.1 - Downtown General Improvement District (GID) Core Offer O 112,000 0 0 0 112,000 Dedicated funding source Dedicated funding 15 41.3 - ENHANCEMENT: Use Tax and Business Personal Property Tax Rebates E 401,157 0 401,157 0 0 Dedicated funding source Dedicated funding 22 80.1 - Convention and Visitors Services O 1,098,916 1,098,916 0 0 0 Dedicated funding source Dedicated funding 25 41.10 - Northern Colorado Regional Airport Operational Support O 177,500 111,257 66,243 0 0 Contractual obligation 26 30.2 - ENHANCEMENT: 2.0 FTE - Park Technician and Park Maintenance Worker with Expansion of Downtown Maintenance 2.00 E 173,998 135,498 38,500 0 0 135,498 38,500 173,998 31 41.15 - ENHANCEMENT: Metro District Support E 87,500 87,500 0 0 0 87,500 0 87,500 46 80.2 - ENHANCEMENT: Tourism Master Plan, Visitor and Convention Services E 50,000 0 50,000 0 0 0 50,000 50,000 Funded Subtotal 2.00 $4,975,168 $3,685,888 $593,900 $0 $528,380 $167,000 $451,978 $88,500 $540,478 ENVIRONMENTAL HEALTH 5 43.2 - Timberline Recycling Center O 291,916 0 0 291,916 0 9 86.2 - Natural Areas - Department Management O 1,118,975 53,375 0 0 1,065,600 Natural Areas Fund 13 43.1 - Environmental Services O 1,624,914 1,441,799 0 183,115 0 250,000 250,000 20 86.5 - Natural Areas - Planning and Special Projects O 1,721,256 30,585 0 98,770 1,591,901 Natural Areas Fund 129,355 129,355 24 9.16 - ENHANCEMENT: CAPITAL - Utilities: Environmental Learning Center Dam Rehabilitation - Design & Permitting E 500,000 0 166,500 0 333,500 Utilities Funds / Skipped due to needing ongoing 33 43.12 - ENHANCEMENT: 2030 Climate Action and Energy Policy Update – Optimizing Policy, Targets and Strategies E 40,000 0 20,000 0 20,000 Utilities Funds / Skipped due to needing ongoing 35 86.10 - ENHANCEMENT: Encampment Cleaning Services E 206,000 0 100,000 26,000 80,000 Utilities Funds 126,000 126,000 38 9.20 - ENHANCEMENT: Utilities: Legal and Consulting Services for Response to the Northern Integrated Supply Project E 150,000 75,000 0 0 75,000 Utilities Funds 75,000 75,000 43 43.10 - KFCG ENHANCEMENT: Road to Zero Waste Plan Update E 15,000 0 0 15,000 0 15,000 15,000 DRILLING PLATFORMS - FUNDED OFFERS All KFCG OCP and OT goes away = $6.9M ongoing and $1.2M one-time as of 1/3/2019 entire offer is eliminated reduction amount funding for offer is reduced Rank Offer # - Offer Description FTE Offer Type Offer Total General Fund Ongoing General Fund 1-Time & Reserves KFCG Dedicated KFCG OCP KFCG OT Other Notes / Funds included in "Other" Ongoing One-Time Total TARGET REDUCTION 2 25.2 - Police Patrol Services O 16,972,937 15,876,625 91,431 1,004,881 0 0 3 25.5 - Police Information Services O 8,019,397 6,657,427 0 1,361,970 0 0 4 33.1 - Municipal Court Services O 1,131,144 1,049,582 9,810 0 71,752 0 5 75.1 - Poudre Fire Operation, Maintenance & Capital (General Fund) O 26,715,616 26,715,616 0 0 0 0 6 75.2 - KFCG: Poudre Fire Authority Operation, Maintenance & Capital O 2,972,456 0 0 2,972,456 0 0 7 87.1 - City Manager's Office: Office of Emergency Management - 0.5 FTE plus 2.0 FTE transfer from PFA 2.50 O 357,087 230,638 49,449 0 0 77,000 Utilities Funds 8 51.1 - Police Facilities Utilities and Building Operations O 422,515 386,515 36,000 0 0 0 9 25.1 - Police Office of the Chief and Administration O 3,525,894 3,049,600 0 476,294 0 0 10 25.4 - Police Criminal Investigations Division O 7,275,807 5,688,208 85,000 1,502,599 0 0 11 25.9 - Police Colorado Regional Information Sharing Project [CRISP] O 494,040 0 494,040 0 0 0 12 25.6 - Police Vehicle Program O 2,087,704 1,784,950 133,000 169,754 0 0 13 25.3 - Police Community and Special Services O 5,268,946 3,729,172 25,000 1,514,774 0 0 15 25.23 - ENHANCEMENT: CAPITAL REPLACEMENT - Police Services Uninterrupted Power Supply (UPS) Replacement - Minor Capital Replacement E 148,540 0 148,540 0 0 0 16 25.14 - ENHANCEMENT: Police Radio Infrastructure - Northern Colorado Regional Communication Network [NCRCN] E 58,860 0 58,860 0 0 0 20 96.3 - ENHANCEMENT: Event Log and Performance Monitoring Tool E 139,300 0 12,996 0 0 126,304 Utilities Funds 21 33.2 - ENHANCEMENT: 0.2 FTE for Municipal Court Judge and Security Screeners 0.20 E 93,268 93,268 0 0 0 0 22 25.19 - ENHANCEMENT: Police School Resource Officers for Poudre School District E 110,240 110,240 0 0 0 0 23 25.16 - ENHANCEMENT: Police Reports Voice-to-Text Transcription E 88,836 (3,890) 92,726 0 0 0 25 25.11 - ENHANCEMENT: 8.0 FTE - Police Services Resources for a Growing Community 8.00 E 391,593 391,593 0 0 0 0 26 25.20 - ENHANCEMENT: Debt Service for Police Regional Training Facility E 661,000 218,130 442,870 0 0 0 28 25.8 - Police Red Light & Camera Radar Program E 599,897 599,897 0 0 0 0 29 96.2 - ENHANCEMENT: Cyber Security Training, Monitoring and Measuring E 70,000 0 30,800 0 0 39,200 Utilities Funds 42 73.2 - ENHANCEMENT: 1.0 FTE (0.75 FTE Attorney, 0.25 FTE Legal Assistant) - Municipal Court Prosecution Resources 1.00 E 175,683 155,683 20,000 0 0 0 155,683 20,000 175,683 50 73.1 - ENHANCEMENT: Municipal Prosecution Technology Tools E 24,755 24,755 0 0 0 0 24,755 0 24,755 55 25.15 - ENHANCEMENT: Police Camera Radar/Red Light Addition E 575,124 575,124 0 0 0 0 Dedicated funding source Dedicated funding 68 25.31 - KFCG ENHANCEMENT: 1.0 FTE - FC911 Emergency Services DRILLING PLATFORMS - FUNDED OFFERS All KFCG OCP and OT goes away = $6.9M ongoing and $1.2M one-time as of 1/3/2019 entire offer is eliminated reduction amount funding for offer is reduced Rank Offer # - Offer Description FTE Offer Type Offer Total General Fund Ongoing General Fund 1-Time & Reserves KFCG Dedicated KFCG OCP KFCG OT Other Notes / Funds included in "Other" Ongoing One-Time Total TARGET REDUCTION 10 35.3 - Essential Street Operations O 3,114,863 440,794 0 0 1,132,963 1,541,106 Transportation Fund 1,573,757 0 1,573,757 11 35.1 - Street Maintenance Program O 15,885,512 0 0 7,606,019 0 8,279,493 Transportation Fund / KFCG Dedicated to Street Maintenance 14 6.4 - FC Bikes O 435,494 0 0 0 352,251 83,243 Transportation Fund 352,251 0 352,251 15 6.3 - Safe Routes to School Program O 169,807 0 0 0 169,807 0 169,807 0 169,807 16 6.9 - School Crossing Guard Program O 94,350 0 0 0 94,350 0 94,350 0 94,350 17 31.1 - Streetscape Maintenance O 760,604 760,604 0 0 0 0 760,604 0 760,604 19 34.4 - Signal Pole Inspection and Maintenance O 100,000 0 100,000 0 0 0 0 100,000 100,000 22 34.5 - Neighborhood Traffic Mitigation Program O 150,000 88,581 0 0 61,419 0 General Fund portion is dedicated to this program 61,419 0 61,419 25 1.3 - KFCG City Bridge Program O 1,700,000 0 0 1,700,000 0 0 KFCG Dedicated to Street Maintenance 33 1.26 - KFCG ENHANCEMENT: Railroad Crossing Maintenance E 125,000 0 0 0 125,000 0 125,000 0 125,000 34 45.11 - ENHANCEMENT: Electric Bus Pilot E 880,000 0 105,000 0 0 775,000 Transit Fund / Grant related 35 45.15 - ENHANCEMENT: Transfort Capital Asset Repair and Replacement E 2,387,000 0 144,000 0 0 2,243,000 Transit Fund / Grant related 37 69.3 - ENHANCEMENT: Debt Service for Prospect & I-25 Interchange E 1,377,500 674,833 483,667 0 0 219,000 Transportation Fund 1,158,500 0 1,158,500 40 31.2 - ENHANCEMENT: 1.0 FTE - Park Technician and New Streetscapes 1.00 E 162,833 162,833 0 0 0 0 162,833 0 162,833 45 34.3 - KFCG ENHANCEMENT: Adaptive Signal System Expansion E 57,581 0 0 0 57,581 0 0 57,581 57,581 91 31.5 - REDUCTION: Contractual Median Maintenance R (25,000) (25,000) 0 0 0 0 Excluded Reduction Offer Funded Subtotal 1.00 $56,794,984 $10,936,407 $981,655 $9,306,019 $4,840,191 $30,730,712 $0 $4,708,521 $157,581 $4,866,102 2,772,731 100,000 1,993,371 HIGH PERFORMING GOVERNMENT 1 2.1 - Information Technology Application Services O 3,304,825 2,022,329 0 0 0 0 1,282,496 Data & Comm 2 3.1 - Information Technology Infrastructure Services O 3,155,915 1,383,448 0 0 0 0 1,772,467 Data & Comm 3 3.2 - Information Technology Client Services O 1,594,117 1,132,458 0 0 0 0 461,659 Data & Comm 4 3.3 - Information Technology Infrastructure Equipment O 1,610,586 410,835 332,000 30,000 0 0 837,751 Data & Comm 5 4.1 - Information Technology Administration Services O 524,687 376,533 0 0 0 0 148,154 Data & Comm 6 5.1 - HR Core Services O 2,399,883 2,056,883 343,000 0 0 0 0 9 10.2 - Utilities: Customer Service & Administration - Customer Connections Programs and Services O 6,710,985 50,744 0 0 0 0 6,660,241 Utilities 12 13.1 - City Clerk Services O 807,436 807,436 0 0 0 0 0 13 13.2 - Elections O 318,744 0 318,744 0 0 0 0 14 15.1 - Communications and Public Involvement (CPIO) O 1,848,005 1,763,559 0 0 84,446 0 0 15 39.2 - City Manager's Office O 2,303,336 2,123,118 18,000 0 0 0 162,218 16 52.1 - Financial Programs and Services O 3,929,009 3,820,705 108,304 0 0 0 0 17 64.1 - PDT Administration O 1,252,393 599,139 0 0 0 0 653,254 19 63.1 - General Legal Services O 2,637,059 2,242,040 0 0 0 0 395,019 Utilities 20 39.1 - City Council O 177,290 161,290 0 0 16,000 0 0 DRILLING PLATFORMS - FUNDED OFFERS All KFCG OCP and OT goes away = $6.9M ongoing and $1.2M one-time as of 1/3/2019 entire offer is eliminated reduction amount funding for offer is reduced Rank Offer # - Offer Description FTE Offer Type Offer Total General Fund Ongoing General Fund 1-Time & Reserves KFCG Dedicated KFCG OCP KFCG OT Other Notes / Funds included in "Other" Ongoing One-Time Total TARGET REDUCTION 32 50.8 - ENHANCEMENT: Fleet Vehicle and Equipment Replacements E 664,943 0 206,648 9,310 0 3,185 445,800 Equipment Fund / Skipped due to needing ongoing 43 50.3 - ENHANCEMENT: Facility Major Maintenance E 400,000 0 400,000 0 0 0 0 Skipped due to needing ongoing 45 50.14 - ENHANCEMENT: 0.0 Net FTE Contractual to Classified Conversion - Facilities Construction Project Manager E 7,621 7,621 0 0 0 0 0 $7k is noise on an $8M task 66 71.2 - ENHANCEMENT: Arc Flash Hazard Analysis E 70,000 0 70,000 0 0 0 0 0 70,000 70,000 73 52.7 - ENHANCEMENT: City Give Program 1.0 FTE Contractual (formerly City Fund Foundation) 1.00 E 146,351 0 146,351 0 0 0 0 75 15.3 - ENHANCEMENT: Video Production Assistance Programs - Fort Collins Public Access Network (FC Public Media) E 15,000 0 15,000 0 0 0 0 0 15,000 15,000 85 15.4 - REDUCTION: Stop Doing - City News Newsletter R (26,000) (26,000) 0 0 0 0 0 Excluded Reduction Offer 86 3.10 - REDUCTION: Scheduled Computer Replacements R (125,000) 0 (125,000) 0 0 0 0 Excluded Reduction Offer Funded Subtotal 1.00 $44,988,832 $29,231,551 $2,433,047 $39,310 $349,363 $3,185 $12,932,376 $201,204 $85,000 $286,204 201,204 85,000 0 0 0 0 TOTAL ALL OUTCOMES $3,185,614 $4,843,376 $6,904,126 $1,214,081 $8,118,207 1/9/2019 Page 5 of 5 1.1 Attachment: January 2, 2019 Work Session Summary (7570 : Keep Fort Collins Great Sunset) Option “A” Ballot Question Shall City of Fort Collins taxes be increased by an estimated [dollar amount] for the first full fiscal year (2021), and by whatever additional amounts are raised annually thereafter, by extending, without an expiration date, the City’s current .85% sales and use tax set to expire December 31, 2020; with this tax not applying to items exempt from the City’s sales and use tax under the City Code, such as food for home consumption and prescription drugs, and the use tax not applying to manufacturing equipment; with the revenue from it used for any public purpose, except 11% of revenues shall be used to fund fire protection and related services in the City through the Poudre Fire Authority or other means; and with all the tax revenues, and investment earnings thereon, collected, retained and spent as a voter-approved revenue change notwithstanding the spending and revenue limitations of Article X, Section 20 of the Colorado Constitution and any other law? Option “B” Ballot Question Shall City of Fort Collins taxes be increased by an estimated [dollar amount] for the first full fiscal year (2021), and by whatever additional amounts are raised annually thereafter, by extending the City’s current .85% sales and use tax set to expire December 31, 2020; with .60% of the tax rate having no expiration date and its revenues used for any public purpose, except 15.6% of revenues shall be used to fund fire protection and related services in the City through the Poudre Fire Authority or other means; with the remaining .25% of the rate used for the City’s sustainability and transportation programs and expiring [date]; with the sales and use tax not applying to items exempt from the City’s sales and use tax under the City Code, such as food for home consumption and prescription drugs, and the use tax not applying to manufacturing equipment; and with all the tax revenues, and investment earnings thereon, collected, retained and spent as a voter-approved revenue change notwithstanding the spending and revenue limitations of Article X, Section 20 of the Colorado Constitution and any other law? ATTACHMENT 2 1.2 Packet Pg. 13 Attachment: Description of Ballot Options A and B (7570 : Keep Fort Collins Great Sunset) 1 City Council Work Session January 22, 2018 Keep Fort Collins Great-2020 Sunset ATTACHMENT 3 1.3 Packet Pg. 14 Attachment: PowerPoint Presentation (7570 : Keep Fort Collins Great Sunset) Direction Sought 1. Which revenue replacement option would Council like to move forward? 2. If Option B: • What should be the length of the term? 2 1.3 Packet Pg. 15 Attachment: PowerPoint Presentation (7570 : Keep Fort Collins Great Sunset) Timeline  Last Day to Refer Ballot language- February 5, 2019  Election-April 2, 2019 3 1.3 Packet Pg. 16 Attachment: PowerPoint Presentation (7570 : Keep Fort Collins Great Sunset) KFCG Conversation November 2017 Council Finance Committee January 2019 Council Work Session 4 Council Finance Committee Council Work Session Council Regular Meeting 1.3 Packet Pg. 17 Attachment: PowerPoint Presentation (7570 : Keep Fort Collins Great Sunset) KFCG Sunset Key Elements Council direction to date:  No additional tax on groceries  Don’t increase total tax burden  Maintain financial commitments to Poudre Fire Authority 5 1.3 Packet Pg. 18 Attachment: PowerPoint Presentation (7570 : Keep Fort Collins Great Sunset) Options: Same Revenue Option A: Increase the City base sales tax rate by 0.85%. • One-time vote to increase the base rate tax by 0.85%. • Revenue prioritized and allocated by Council through budgeting process. Option B: Increase the City base sales tax rate by 0.60% and put forward a 0.25% dedicated, renewable tax • One-time vote to increase the base sales tax by 0.6% and consideration of a 0.25% dedicated tax. • To maintain existing KFCG programs and services the 0.25% would support “Other Transportation” and “Sustainability” programs and services. 6 1.3 Packet Pg. 19 Attachment: PowerPoint Presentation (7570 : Keep Fort Collins Great Sunset) Ballot Language Basics  Both options would include ballot language to honor and continue to provide funding for Fire Protection and Emergency services.  Neither option would result in an increase to tax on groceries or prescription drugs.  The current 0.85 tax exempts manufacturing and current ballot language will reflect the same exemption.  Both options would trigger TABOR election notice requirements. 7 1.3 Packet Pg. 20 Attachment: PowerPoint Presentation (7570 : Keep Fort Collins Great Sunset) Outreach Feedback  Overall support for replacing most if not all revenue.  Some trepidation of losing dedicated funding for particular services but an understanding that greater flexibility in funding could be a benefit.  Support for keeping ballot question as simple as possible.  Overall support for an increase to the base rate (particularly to cover police, streets, and fire.)  City revenue and expense is a challenging conversation for the public to be able to provide specific revenue options.  Majority like level of service with limited suggestions for where to reduce. 8 1.3 Packet Pg. 21 Attachment: PowerPoint Presentation (7570 : Keep Fort Collins Great Sunset) Direction Sought 1. Which revenue replacement option would Council like to move forward? 2. If Option B: • What should be the length of the term? 9 1.3 Packet Pg. 22 Attachment: PowerPoint Presentation (7570 : Keep Fort Collins Great Sunset) DATE: STAFF: January 22, 2019 Ginny Sawyer, Policy and Project Manager WORK SESSION ITEM City Council SUBJECT FOR DISCUSSION Occupancy Study. EXECUTIVE SUMMARY The purpose of this item is to present and review the report and findings from the Occupancy Study. GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED 1. What questions does Council have regarding the report and findings? 2. Does Council have any requested follow-up action items based on the presentation and discussion? BACKGROUND / DISCUSSION The City of Fort Collins has a long history with the occupancy ordinance. The original ordinance was adopted in 1964 and limited occupancy to no more than three unrelated people. In 2005, after much public input and an Economic Study, City Council amended the ordinance to add clarity and to make violations a civil infraction thus making the ordinance more enforceable. Enforcement of the revised ordinance began in 2007. In 2009, a policy discussion and review of the ordinance included an additional Economic and Impact Study. The study provided a mix of quantitative and qualitative information with a goal of determining the impact of enforcement. The ordinance has always been controversial among stakeholders. The Associated Students of Colorado State University and others have requested an increase in occupancy limits and the real estate community has questioned the efficacy and potential impact of the ordinance on housing affordability. Neighbors and long-term residents, especially those living near CSU, remain strong advocates of the ordinance and its positive impacts in their neighborhoods. Over the last decade, staff has made numerous tweaks in the ordinance and in administration of the ordinance including changes to notification requirements, to the disclosure statement process, and to allowances for host families and extra-occupancy rental units. In 2016, the City was asked to consider soliciting another study to determine both the effectiveness of the ordinance as well as potential unintended consequences. In 2017, in partnership with Colorado State University (CSU), the Associated Students at Colorado State University (ASCSU), the Board of Realtors (BOR), and neighbors, a scope of study was created, and an RFP issued. Corona Insights was chosen to conduct the study which began in 2018 and was coordinated to work around the academic school year. Study scope: Primary questions to be answered a. Has the occupancy ordinance had an impact on neighborhood quality? b. Does the occupancy ordinance impact the affordability of housing? 2 Packet Pg. 23 January 22, 2019 Page 2 Information on short term rental impacts was also included. This study, unlike the previous, did not include “what-if” questions or scenarios. It is intended to be a snapshot in time of the rental market and the forces that affect it, with comparisons over time from which the City and the community can identify trends. Study Process Corona Insights utilized census data, City enforcement and violation data, randomized surveys, and targeted surveys to short-term rental license holders to conduct overall analysis of our local housing market, trends, and resident perceptions related to the occupancy ordinance and neighborhood quality. Many of these same techniques and markers were used in both the 2005 and 2009 studies, which allowed for comparisons over time. The full report examines the following major topics: 1. Overview of rental market trends compared to other comparable markets. 2. Estimates of the number of occupancy ordinance violator households and their characteristics. 3. Examination of neighborhood quality issues and any correlations with proximity to ordinance violators and/or short-term rentals 4. An examination of the outcomes of City investigations of complaints related to the occupancy ordinance. 5. Public support/opposition to the occupancy ordinance and short-term rental rules. 6. An overview of the short-term rental market in terms of numbers, types of units, and revenues. 7. Results of a survey of licensed short-term rental operators to assess uses and origins of their units. Data sources include a public survey that oversampled areas near the campus, a survey of licensed short-term rental operators, a review of previous studies, an analysis of City occupancy complaint data, and a review of secondary sources such as U.S. Census data, Colorado Division of Housing data, and private sector data. Key Findings Overall Rental Market • Rental vacancy rates have rebounded from 1.2 percent in the 2009 study to 2.4 percent today. (These are multi-year averages to stabilize trends.) However, the vacancy rate remains low and has been consistently lower than similar cities. • Median rental costs in Fort Collins have increased by about 65% since 2005, a larger increase than similar cities. • Forces affecting rental vacancy rates have included new construction (increases vacancy rates), population growth (decreases vacancy rates) changes in owner occupancy rates over time (decreases vacancy rates in this time period), occupancy ordinance noncompliance (compliance decreases vacancy rates, noncompliance increases vacancy rates), and the rise of short-term rentals (decreases vacancy rates), with numerous other contributing forces. Occupancy Ordinance Violators • The estimated number of violator households declined after ordinance enforcement began from approximately 1,200 households to under 600 households in 2009 but has since risen back to the pre- enforcement era estimate of 1,200 households. (This represents a slightly lower incidence of the population than 2005 due to population growth.) • 74 percent of violator households had three or more vehicles, compared to 22 percent of non-violator households. • Violator households generally formed and dissolved quickly. 47 percent of violator households have lived in their home for less than a year. • 67 percent of occupancy violation complaints were unfounded in 2017 compared to 45 percent in 2011. 2 Packet Pg. 24 January 22, 2019 Page 3 Occupancy Ordinance Perceptions • Most residents were aware of the ordinance (89 percent), though most said that it has no significant impact on their neighborhood (78 percent). Support for the ordinance was higher than opposition (42 percent versus 24 percent), and residents were more likely to say that it had a positive impact on their neighborhood than negative (15 percent versus 8 percent). • 38 percent of residents liked the current enforcement philosophy of the ordinance. Among those desiring a change, roughly equal proportions wanted it to be enforced less strictly (18 percent) versus more strictly (17 percent). 28 percent said they did not know. Short-Term Rentals (STRs) • Over the past year, there were approximately 500 to 600 short-term rentals being offered each month. The number of STRs grew rapidly from 2014 through 2017. Growth is slowing in 2018, but year over year growth appears to be 45 units per year. • STRs are evolving toward full-unit rentals as opposed to rooms inside a person’s home. Full units have gone from 34 percent of STRs in 2014 to 46 percent in 2018. • Average monthly revenues per unit have risen notably, from $599 in October of 2014 to $1,201 in October of 2017. This is likely due to larger units being offered over time and more units being offered on a full-time basis. • Estimated total short-term rental revenues have risen from approximately $500,000 in 2014 to $6.6 million in 2017, and a trend for $9.6 million in 2018. • STR hosts in Fort Collins were nearly exclusively sole proprietors who were motivated to rent their properties for extra income, the unique benefits/flexibility of STRs over alternatives, and the cultural experience of the STR scene. • Approximately 30 percent of STRs were former long-term rentals that were converted, and another 30 percent were removed from the housing market in other ways. Approximately 40 percent would not be on the housing market if they were not STRs. • Most residents say that STRs had no significant impact (or unknown impact) on their neighborhood (80 percent). Only 2 percent say that STRs had a positive impact compared to 13 percent who said they had a negative impact. Neighborhood Quality Indictors Note: Neighborhood quality was measured via four attributes: peace and quiet, maintenance of lawns/houses, and sense of community). Negative issues with neighbors were measured in eight areas: inappropriate parking, loud non-party noise, non- shoveled walks, uncontrolled pets, trash or junk in yard, disruptive parties, poorly maintained homes, and criminal activity. • Among eight neighborhood quality issues tested, the most common issue citywide was vehicles parked inappropriately, followed by loud noise (excluding parties) and non-shoveled sidewalks. • Residents with at least one suspected ordinance-violating neighbor were much more likely to report lower neighborhood quality than did residents without a suspected ordinance-violating neighbor. They were also more likely to report negative issues with their immediate neighbors on each of the eight tested issues. • Residents with at least one suspected short-term rental (STR) neighbor were more likely to report lower neighborhood quality than those without an STR neighbor. These negative impacts were generally (but not always) smaller than the impacts of ordinance-violating households. • Residents with STR neighbors were also more likely to report negative issues with their immediate neighbors on each of the eight tested issues. The negative impacts were generally slightly larger in areas where STRs are not allowed than in areas where STRs are allowed. The negative impacts were generally notably smaller than the impacts reported by those with ordinance violating neighbors (with the exception of uncontrolled pets, where the impacts were similar). 2 Packet Pg. 25 January 22, 2019 Page 4 STR Rule Perceptions • Residents generally supported or were neutral on STR rules (41 percent supported, 39 percent neutral,19 percent opposed). Public Engagement A stakeholder group of neighbors, ASCSU, and Board of Realtor members met both prior to and after the study. The group was also engaged through email as the resident survey was created. In seeing and discussing the findings overall comments included: • Good and valuable information. • Some surprises. • Reiteration that our housing market is complex, and it is difficult if not impossible to draw one-to-one correlations. Potential Action Item Although not related to the study, the Home Share program presents an option for an exception to the occupancy ordinance. The Home Share program was developed locally and is administered by Neighbor to Neighbor out of the Off- Campus Life Office at CSU. The program is open to home owners who live in their home and are over 55 years of age. Home Share helps to match tenants with these home owners through interviews and background checks. If needed, the lease includes a reduced rent for household help (maintenance, snow-shoveling, errands, etc.) Under the current ordinance, a home owner couple over 55 could not rent to another couple or to two unrelated tenants. This could be an area to consider an exemption. This possibility was discussed among the stakeholder group and was considered a good option provided that parking was addressed. ATTACHMENTS 1. Neighbor to Neighbor Homeshare Information (PDF) 2. PowerPoint Presentation (PDF) 3. Corona Insights Rental Market Report to Fort Collins (PDF) 2 Packet Pg. 26 ATTACHMENT 1 2.1 Packet Pg. 27 Attachment: Neighbor to Neighbor Homeshare Information (7567 : Occupancy Study) 2.1 Packet Pg. 28 Attachment: Neighbor to Neighbor Homeshare Information (7567 : Occupancy Study) January 22, 2019 City Council Work Session-Occupancy Study Ginny Sawyer and Corona Insights ATTACHMENT 3 2.2 Packet Pg. 29 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Questions 1. What questions does Council have regarding the report and findings? 2. Does Council have any requested follow-up action items based on the presentation and discussion? 2 2.2 Packet Pg. 30 Attachment: PowerPoint Presentation (7567 : Occupancy Study) History Enacted in 1964 - criminal violation Neighborhood Quality Efforts 2003-2005: Public Nuisance Ordinance, Party Patrol, Increased fines, Nuisance Gathering, Community Liaison, Landlord Training 2005-Occupancy Ordinance Revisions: De-criminalized, changed definition, disclosure statement, extra- occupancy rental house permit—effective 2007 3 2.2 Packet Pg. 31 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Occupancy Studies 2005 – Economic and Market Study (pre-ordinance) Goals: Effect on rental vacancy rates; rental prices; and home values. 2009 - Economic and Market Impact Study (4-year post ordinance) Goals: Estimated # of violators; Changes in rental prices and vacancy rates; Perception surveys and interviews 2017 – Proposed New Study (11-year post-ordinance) • Has the occupancy ordinance had an impact on neighborhood quality? • Does the occupancy ordinance impact the affordability of housing? 4 2.2 Packet Pg. 32 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Study Questions Does the occupancy ordinance impact the affordability of housing? - Likely yes. Has the occupancy ordinance had an impact on neighborhood quality? -Yes. Many additional factors and trends also contributing to overall housing situation. 5 2.2 Packet Pg. 33 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Rental Housing Forces At Work 6 A variety of issues have affected the local rental market over the past 15 years. Rental Market Population Growth Wages Construction of New Housing Occupancy Ordinance Rise of Short Term Rentals Household formation dynamics and geography Condo Defects Law The Great Recession 2.2 Packet Pg. 34 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Snapshots of the Rental Market 2005 - 2007 Era Rental Vacancy Rate 5.4% Excess Rental Units +100 units 1,200 violator households 2010 - 2012 Era Rental Vacancy Rate 1.2% Excess Rental Units -1,000 units 550 violator households 2015 - 2017 Era Rental Vacancy Rate 2.4% Excess Rental Units -800 units 1,200 violator households 2.2 Packet Pg. 35 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Supply and Demand Impact on Rent Fort Collins, Colorado Joliet, Illinois Fort Wayne, Indiana Lincoln, Nebraska Durham, North Carolina Greensboro, North Carolina Raleigh, North Carolina Winston‐Salem, North Carolina Eugene, Oregon Salem, Oregon Columbia, South Carolina Sioux Falls, South Dakota Provo, Utah Pueblo, Colorado Colorado Springs, Colorado Greeley, Colorado 0% 10% 20% 30% 40% 50% 60% 70% 80% 0123456789 Percent Change in Gross Median Rent New People Per New Housing Unit Supply/Demand and Median Gross Rent Change 2005‐2017 Population growing faster than housing supply 2.2 Packet Pg. 36 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Rental Housing Market 9 Despite similar population trends:  Vacancy rates remain lower than others.  Rent has increased at a higher rate than similar areas post ordinance. 2.2 Packet Pg. 37 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Key Findings-Ordinance Violators  Estimated number of violator households declined approximately 1,200 to 600 between 2005 and 2009.  In 2017 number back to estimate of 1,200.  74% of violator households had three or more vehicles, compared to 22% of non-violator households.  Increase in non-student violator households.  Approximately 67% of occupancy investigations were found to NOT be in violation in 2017. 10 2.2 Packet Pg. 38 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Occupancy Ordinance Violators The number of occupancy- violating households has risen back to pre-ordinance levels. 2.2 Packet Pg. 39 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Occupancy Ordinance Violator Vehicles Violator households tend to have more vehicles. 2.2 Packet Pg. 40 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Occupancy Ordinance Demographics Mostly young and unrelated population, but diverse in age. Children emerging as demographic. 2.2 Packet Pg. 41 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Occupancy Violator College Status In 2005, Less than 50 percent college students 71% of violator households had collage students 2.2 Packet Pg. 42 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Occupancy Ordinance Investigations 55% 56% 48% 50% 45% 37% 33% 45% 44% 52% 50% 55% 63% 67% 0% 25% 50% 75% 100% 2011 2012 2013 2014 2015 2016 2017 Percentage of Outcomes from Over Occupancy Investigations Unfounded Violation Complaints are more likely to be unfounded 2.2 Packet Pg. 43 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Key Findings-Ordinance Perceptions  89% of residents are aware of the ordinance.  78% reported ordinance has no significant impact on their neighborhood.  Support for the ordinance was higher than opposition (42 % vs 24 %).  Residents were more likely to say that the ordinance had a positive impact on their neighborhood than negative (15% vs 8%).  Among those desiring a change, roughly equal proportions wanted it to be enforced less strictly (18%) versus more strictly (17%). 16 2.2 Packet Pg. 44 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Occupancy Ordinance Opinions Total Region Dwelling Type Tenure College Student in Home Aware of Occupancy Ordinance West of campus East of campus Remainder of city Single family Multi- family Owner Renter Yes No Yes No Base Unweighted 1328 355 498 475 1044 284 1049 271 202 1064 1167 123 Opinion of Occupancy Ordinance Support 42% 38% 44% 43% 45% 37% 53% 30% 19% 47% 43% 28% Neutral 31% 34% 26% 31% 29% 34% 25% 38% 31% 31% 29% 40% Oppose 24% 26% 25% 23% 22% 27% 19% 29% 44% 19% 24% 27% No opinion 3% 3% 4% 3% 4% 3% 3% 4% 7% 2% 3% 5% More support than opposition for ordinance 2.2 Packet Pg. 45 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Key Findings-Neighborhood Quality Neighborhood Quality : peace and quiet, lawn/home maintenance, sense of community Negatives: inappropriate parking, noise, non-shoveled walks, pets, trash or junk in yard, disruptive parties, poorly maintained homes, and criminal activity  Most common issues citywide were vehicles parked inappropriately, loud noise and non-shoveled sidewalks.  Residents with suspected ordinance-violating neighbor(s) were much more likely to report lower neighborhood quality than residents without.  Residents with suspected short-term rental (STR) neighbor were more likely to report lower neighborhood quality than those without. 18 2.2 Packet Pg. 46 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Neighborhood Quality and Violators Total West of campus- Neighbor(s) violating occupancy ordinance East of campus- Neighbor(s) violating occupancy ordinance Remainder of city- Neighbor(s) violating occupancy ordinance Yes No Yes No Yes No Peace and quiet 1.13 0.52 0.92 0.78 1.24 0.85 1.3 Maintenance of lawns 1.08 0.51 0.97 0.57 0.93 0.72 1.28 Maintenance of houses 1.08 0.5 0.96 0.83 0.95 0.49 1.31 Sense of community 0.49 -0.11 0.44 0.45 0.58 0.03 0.65 Very good = 2, Fair = 0, Very bad = -2, Not applicable = excluded Proximity to a suspected ordinance violator correlates with lower neighborhood quality 2.2 Packet Pg. 47 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Trends in Quality 84% 81% 87% 58% 89% 85% 90% 68% 85% 75% 82% 54% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Peace and quiet Maintenance of lawns Maintenance of houses Sense of community Percentage of Single Family Homes that Rated Their Neighborhood Good or Very Good 2004 2008 2018 Trends are not correlated only with violators Neighborhood quality rose and then fell in the past 15 years 2.2 Packet Pg. 48 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Key Findings-Short Term Rentals  Full unit rentals are increasing.  Hosts are sole proprietors motivated by extra income, unique benefits/flexibility of STRs over alternatives, and the cultural experience.  ~ 30% of STRs are previous long-term rentals.  ~ 40% would not be on the housing market if they were not STRs.  80% of residents report STRs having no significant impact on their neighborhood.  2% report a positive impact compared to 13% reporting a negative impact. 21 2.2 Packet Pg. 49 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Types of Short-Term Rentals Short-Term Rentals (STRs) are evolving toward full units. Entire home/apt Private room Shared room 2014 34% 57% 9% 2015 37% 56% 6% 2016 41% 54% 4% 2017 44% 52% 5% 2018 46% 50% 4% Pulled Directly From Long- Term Rental Market 30% Pulled From Housing Market, Either Rental or Ownership 30% Would Not Be In the Rental Market If Not Short- Term Rental 40% 2.2 Packet Pg. 50 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Summary  Numerous factors, including the occupancy ordinance, have contributed to a significant increase in rent prices over the last 15 years.  Neighbors report higher neighborhood quality when they don’t perceive any over-occupied housing near them.  In general, there is higher support than opposition to the occupancy ordinance.  Demographic of violator households has shifted. 23 2.2 Packet Pg. 51 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Questions 1. What questions does Council have regarding the report and findings? 2. Does Council have any requested follow-up action items based on the presentation and discussion? 24 2.2 Packet Pg. 52 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Home Share  Neighbor to Neighbor Program  Home owners 55+  Background checks, interviews, lease writing assistance  Matching owners with tenants  Program could be constrained by current occupancy ordinance 25 2.2 Packet Pg. 53 Attachment: PowerPoint Presentation (7567 : Occupancy Study) Market Trends, Occupancy Ordinance, and Short-Term Rentals Rental Market Study ATTACHMENT 2 2.3 Packet Pg. 54 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Contents Fort Collins Rental and Occupancy Study 2 Executive Summary 3 Introduction 28 Section 1: Rental Market Trends 33 Section 2: Ordinance Violators 88 Section 3: Short-Term Rentals 126 Section 4: Neighborhood Quality 150 Appendix 170 2.3 Packet Pg. 55 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary 2.3 Packet Pg. 56 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Rental Market Overview, 2005 to 2010 Market forces 10 to 15 years ago conspired against the rental market. In 2007, the City began actively enforcing the Occupancy Ordinance, which was expected to create new rental demand as larger households disbanded to form a higher number of smaller households. This occurred at a time when the city’s rental market was healthy, with a slight surplus of vacant rental units, so the expectation of resulting decreases in vacancy rates was not of major concern. However, in December of 2007, the Great Recession began, resulting in a major slowdown of new home construction. The population of Fort Collins continued to grow, creating more demand for housing than the construction market could meet. In addition, several market forces specifically increased demand in the rental market. In addition to the ordinance enforcement and general population growth, the economy likely created new renters due to foreclosures, and the new Condo Defects Law likely stunted the development of condominiums that are a traditional path from renting to home ownership. The result was a steep decline in rental vacancy rates that created a very challenging market for renters in the 2010 to 2012 time frame, as shown on the following page. We conclude that the ordinance was one of several forces that led to the decrease in vacancy rates during this period, which would have contributed to increasing rental prices. Fort Collins Rental and Occupancy Study 4 2.3 Packet Pg. 57 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Snapshot – 2005 to 2012 Fort Collins Rental and Occupancy Study 5 2005 to 2007 Era Rental Vacancy Rate 5.4% Excess Rental Units Above Ideal Vacancies +100 units 1,200 violator households 2010 to 2012 Era Rental Vacancy Rate 1.2% Rental Unit Shortage Below Ideal Vacancies -1,000 units 550 violator households Intervening Events The Great Recession • Slowdown in construction • Increased rental demand due to foreclosures, lack of supply, financial issues • “Lost renters” due to lower household formation or other issues Ordinance Enforcement Increased rental demand as households reformed Population Growth Increased natural rental demand 3.9 percent per year rental cost increases 2.3 Packet Pg. 58 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Rental Market Overview, 2010 to 2018 A slow recovery over the past several years As the recession ended, Fort Collins’ rental market was more or less gridlocked, with a very low vacancy rate. In the light of this supply shortage, construction surged. However, the population was still growing and prices were on the rise quickly, creating new challenges. While construction began making headway in moving the market back toward a healthy level, it barely outpaced increased demand. In addition, pent-up demand from the recession was released, bringing new households into the market. Likely a result of housing affordability and other issues, home ownership rates continued to drop, albeit at a slower rate than they had in the recession. Additionally, a new market phenomenon arrived on the scene to siphon off the rental housing supply. Short-term rentals are a relatively small force, but nonetheless diverted some of the housing supply from long-term rentals to short-term rentals. In response to this, some households began doubling up for different reasons than we saw in the recession. The result is more households that violate the occupancy ordinance, but they are not so much the college students who used to represent that population. A majority are now non-students, often with children. The result has been a slow movement toward a healthy rental market, but not yet enough. The market has improved, but remains unbalanced in favor of landlords and against tenants, as shown on the following page. Fort Collins Rental and Occupancy Study 6 2.3 Packet Pg. 59 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Snapshot – 2010 to 2017 Fort Collins Rental and Occupancy Study 7 2010 to 2012 Era Rental Vacancy Rate 1.2% Excess Rental Units -1,000 units 550 violator households 2015 to 2017 Era Rental Vacancy Rate 2.4% Excess Rental Units -800 units 1,200 violator households Intervening Events Construction Boom Tripling of home construction rates Affordability Slower road to home ownership, more ordinance violators Population Growth Continued population growth Short-Term Rentals New demands on housing stock (though small compared to other forces) 4.2 percent per year rental cost increases Ordinance Compliance continued to increase rental demand and contribute to low vacancy rates (and thus cost increases) 2.3 Packet Pg. 60 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Rental Market Trends The population has grown faster than the housing supply Fort Collins Rental and Occupancy Study 8 A comparison of population growth to housing supply growth shows that Fort Collins is an outlier compared to a number of similar communities around the United States. Fort Collins’ population has grown faster than the change in housing supply, with nearly 7 new people joining the population for each new housing unit being built. This is primarily due to the shortfall of new supply in the 2005 to 2010 time period, which is still affecting the market today. Fort Collins, Colorado Joliet, Illinois Fort Wayne, Indiana Lincoln, Nebraska Durham, North Carolina Greensboro, North Carolina Raleigh, North Carolina Winston-Salem, North … Eugene, Oregon Salem, Oregon Columbia, South Carolina Sioux Falls, South Dakota Provo, Utah Pueblo, Colorado Colorado Springs, Colorado Greeley, Colorado 0% 10% 20% 30% 40% 50% 60% 70% 80% 0123456789 Percent Change in Gross Median Rent New People Per New Housing Unit Supply/Demand and Median Gross Rent Change 2005-2017 2.3 Packet Pg. 61 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Rental Market Trends Fort Collins has lower vacancy rates than other comparable markets in Colorado* Fort Collins Rental and Occupancy Study 9 0 2 4 6 8 10 12 14 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Total Rental Vacancy Rate (Three Year Average) Fort Collins Colorado Springs Greeley Pueblo While other standalone Colorado metro areas faced many of the same market forces as Fort Collins, they were generally starting at a higher vacancy rate, so the declines in vacancy rates moved them from an unhealthy (high) vacancy rate to a generally healthy vacancy rate. In contrast, these forces pushed Fort Collins from a generally healthy vacancy rate to an unhealthy (low) vacancy rate. The Fort Collins market has been slowly moving back to a healthy level since 2011, but is still a challenging market for renters. * Yearly data were not available for the fourth standalone metro area of Grand Junction 2.3 Packet Pg. 62 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Rental Market Trends Fort Collins’ rental costs have increased faster than other comparable markets in Colorado* Fort Collins Rental and Occupancy Study 10 80% 90% 100% 110% 120% 130% 140% 150% 160% 170% 180% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Average Multifamily Rent as a Percentage of InRent the face of low vacancy rates, market 2005 competition will push prices higher. While this has driven prices upward in other Colorado markets as well (with the exception of Grand Junction), the impact has been largest for Fort Collins. (The graph at right is a rental cost index that controls for base differences in rent. It measures each metro area at a 2005 value of 100.) Rents in Fort Collins are 78 percent higher in 2017 than they were in 2005. 2.3 Packet Pg. 63 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Rental Market Dynamics Rental households are getting larger, and owner occupancy is declining Fort Collins Rental and Occupancy Study 11 Over the past ten years, the size of rental households has increased notably from an average of 2.11 people per household to 2.38 people. This is a notable increase in size, and means that nearly 8,000 additional people are living in rental units solely due to this increase. The result is that rental properties are more densely occupied now than they have been in the past. Also of interest is the continuing increase of rental households among the population. Comparing the current rate to ten years ago, we can conclude that approximately 950 households are renting now, and in past years would have owned their homes. This places more demand on the rental market. Era Rental Households Rental Population Average Renter Household Size Proportion of HHouseholds Who Are Renters 2005-2007 23,130 48,790 2.11 43.1% 2010-2012 26,044 59,530 2.29 45.6% 2015-2017 28,871 68,815 2.38 46.4% 2.3 Packet Pg. 64 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Occupancy Ordinance Compliance The number of households not in compliance with the Occupancy Ordinance has increased Fort Collins Rental and Occupancy Study 12 Three studies have been conducted over the past 15 years to estimate the number of households that are violating the occupancy ordinance. Prior to active enforcement of the ordinance, the number was estimated at slightly more than 1,200. The figure declined by nearly 50 percent after enforcement began, but has since risen back to roughly the original number.* However, as described on the following pages, the types of households that are in violation have evolved since 2005. * - Note that due to population growth, the proportion of violator households relative to the population is somewhat lower. 2.3 Packet Pg. 65 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Profile of Occupancy Ordinance Violators College students are no longer the most common type of violator Fort Collins Rental and Occupancy Study 13 In the initial 2005 study, it was estimated that 71 percent of ordinance violators were college students. In the 2018 study, the proportion has shifted dramatically. Only 47 percent of violators are now estimated to be college students, with 53 percent estimated to be non-students. This is a notable change because it implies that affordability may be an issue among non-student populations that is leading to larger households. 45% Undergraduate Students 2% Graduate Students 42% Adult non-students 10 % Pre-K to 12th grade students* * These are minor school-age children of other segments. 2.3 Packet Pg. 66 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Profile of Occupancy Ordinance Violators Violator households are mobile, generally unrelated, and live in houses Fort Collins Rental and Occupancy Study 14 Violator households tend to either form quickly or be mobile, as nearly half moved into their home within the past year. This mobility may increase the likelihood of conflict if they are new to a neighborhood. Of particular note is the age profile. While 40 percent are 18-21 year old adults, 47 percent are older, and 13 percent are children. This influx of adults with children represents a change in the profile over time. 47% have moved into their home in the past 12 months 40% are age 18 to 21 73% live in single-family homes or duplexes 25% of households have children 13% are children 61% have no related people (all roommates) 2.3 Packet Pg. 67 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Profile of Occupancy Ordinance Violators Violator households tend to have numerous vehicles Fort Collins Rental and Occupancy Study 15 When residents were surveyed about the prevalence of eight different neighborhood issues, the most commonly seen issue was inappropriate parking of vehicles. Violator households are vulnerable to this issue because they tend to have numerous vehicles. * - Note that due to population growth, the proportion of violator households relative to the population is somewhat lower. 2.3 Packet Pg. 68 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Perceptions of Occupancy Ordinance Support outweighs opposition, though many are neutral Fort Collins Rental and Occupancy Study 16 The ordinance is well known, with 89 percent of residents being aware of it. Many are neutral towards it, but more residents support the ordinance (42 percent) than oppose it (24 percent). The biggest split is that homes with a college student are more likely to oppose the ordinance than support it, while homes without a student have the opposite stance. * - Note that due to population growth, the proportion of violator households relative to the population is somewhat lower. Total Region Dwelling Type Tenure College Student in Home Aware of Occupancy Ordinance West of campus East of campus Remainder of city Single family Multi- family Owner Renter Yes No Yes No Base Unweighted 1328 355 498 475 1044 284 1049 271 202 1064 1167 123 Opinion of Occupancy Ordinance Support 42% 38% 44% 43% 45% 37% 53% 30% 19% 47% 43% 28% Neutral 31% 34% 26% 31% 29% 34% 25% 38% 31% 31% 29% 40% Oppose 24% 26% 25% 23% 22% 27% 19% 29% 44% 19% 24% 27% No opinion 3% 3% 4% 3% 4% 3% 3% 4% 7% 2% 3% 5% 2.3 Packet Pg. 69 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Perceptions of Occupancy Ordinance Most residents don’t see the ordinance impacting their neighborhood and are split on enforcement . Fort Collins Rental and Occupancy Study 17 Nearly 4 in 5 residents don’t believe that the ordinance has an impact on their neighborhood. Among those who do see an impact, it’s more positive than negative. The one exception is that residents in homes that contain college students are more likely to see a negative impact than a positive impact (17 percent negative versus 11 percent positive). Residents generally prefer the current level of enforcement over more/less strict enforcement. Again, the exception is residents in homes with college students, who strongly prefer less strict enforcement (8 percent more strict, 34 percent less strict. 78% don’t believe that ordinance has an impact on their neighborhood. • 15% see a positive impact • 8% see a negative impact 38% like the current level of enforcement • 17% want more strict enforcement • 18% want less strict enforcement • 28% have no opinion 2.3 Packet Pg. 70 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings The Short-Term Rental Market Short-Term Rentals (STRs) are a growing market Fort Collins Rental and Occupancy Study 18 STRs have consistently grown in number over the past three years. The figures below represent the number of listed units each month for the time period for which data were available at the time of this report. Revenues for proprietors have risen from an estimated $500,000 citywide in 2014 (annualized estimate) to roughly $9.6 million citywide in 2018 (annualized estimate). Month Year 1 2 3 4 5 6 7 8 9 10 11 12 2014 86 88 100 2015 109 99 103 117 140 148 176 176 185 192 213 241 2016 256 266 277 282 329 343 364 376 414 434 445 465 2017 477 473 501 491 533 524 549 541 525 527 541 562 2018 556 528 524 514 2.3 Packet Pg. 71 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings The Short-Term Rental Market Short-Term Rentals (STRs) partially cannibalize units from the rental supply Fort Collins Rental and Occupancy Study 19 In a tight rental housing market, a concern might arise that STRs are removing long-term rentals from the market. While this is true to some extent, not all STRs do so. Approximately 40 percent of STRs are units that would not otherwise be on the market if they weren’t STRs. (For example, they might be a spare bedroom that would just be used as a spare bedroom.) Another 30 percent of STRs are estimated to be directly converted from long-term rentals, and the remaining 30 percent are removed from the housing market, but it cannot be determined if they would have been rental units or owned units. As such, STRs to date do negatively impact rental vacancy rates, but they are currently a smaller force than other market forces. Pulled Directly From Long- Term Rental Market 30% Pulled From Housing Market, Either Rental or Ownership 30% Would Not Be In the Rental Market If Not Short-Term Rental 40% 2.3 Packet Pg. 72 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Perceptions of STR Licensing Rules Support generally outweighs opposition, though many aren’t aware of the rules Fort Collins Rental and Occupancy Study 20 Only 31 percent of residents were aware of STR licensing rules. However, when asked about support or opposition, residents were more likely to support the current rules than oppose them. 41% support current STR rules 39% have no opinion 19% oppose current STR rules 2.3 Packet Pg. 73 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Neighborhood Quality - Citywide Residents generally rate their neighborhood as having positive qualities Fort Collins Rental and Occupancy Study 21 Four measures of neighborhood quality were tested, and all received positive ratings. Peace and quiet, lawn maintenance, and home maintenance received particularly high ratings, while sense of community was lower (but still positive). The neighborhood west of campus is rated lower by its residents than other parts of the city, and renters tend to rate their neighborhood lower than owners. Total Region Tenure College Student in Home West of campus East of campus Remainder of city Owner Renter Yes No Peace and quiet 1.12 0.80 1.14 1.24 1.27 0.94 1.17 1.11 Maintenance of lawns 1.05 0.77 0.87 1.18 1.10 0.99 1.13 1.04 Maintenance of houses 1.07 0.78 0.90 1.20 1.20 0.90 0.89 1.10 Sense of community 0.48 0.25 0.56 0.55 0.76 0.13 0.21 0.54 Very good = 2, Fair = 0, Very bad = -2, Not applicable = excluded 2.3 Packet Pg. 74 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Neighborhood Quality and Ordinance Violators Proximity to suspected ordinance violators is correlated with lower neighborhood quality ratings Fort Collins Rental and Occupancy Study 22 Even within neighborhoods, proximity to suspected ordinance violators tends to correlate with lower ratings on neighborhood quality. Very good = 2, Fair = 0, Very bad = -2, Not applicable = excluded Total West of campus- Neighbor(s) violating occupancy ordinance East of campus- Neighbor(s) violating occupancy ordinance Remainder of city- Neighbor(s) violating occupancy ordinance Yes No Yes No Yes No Peace and quiet 1.13 0.52 0.92 0.78 1.24 0.85 1.3 Maintenance of lawns 1.08 0.51 0.97 0.57 0.93 0.72 1.28 Maintenance of houses 1.08 0.5 0.96 0.83 0.95 0.49 1.31 Sense of community 0.49 -0.11 0.44 0.45 0.58 0.03 0.65 2.3 Packet Pg. 75 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Neighborhood Quality and Short-Term Rentals Proximity to suspected STRs in areas where they are not allowed is correlated with lower neighborhood quality ratings Fort Collins Rental and Occupancy Study 23 Overall, there is a negative correlation between perceived neighborhood quality and proximity to STRs. However, this is an issue only in areas where STRs are not allowed. Very good = 2, Fair = 0, Very bad = -2, Not applicable = excluded Total Neighbor(s) operate STRs No STRs allowed- Neighbor(s) operate STRs Primary STRs only- Neighbor(s) operate STRs Yes No Yes No Yes No Peace and quiet 1.13 1.07 1.14 1.1 1.27 1.17 1.08 Maintenance of lawns 1.07 0.91 1.09 0.71 1.14 1.15 1.09 Maintenance of houses 1.07 0.93 1.09 0.90 1.18 0.96 0.98 Sense of community 0.5 0.36 0.52 0.37 0.68 0.40 0.38 2.3 Packet Pg. 76 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Neighborhood Issues - Citywide Residents generally observe few problems amongst their neighbors Fort Collins Rental and Occupancy Study 24 Among the tested issues, the most common are parking vehicles inappropriately and loud noises other than parties. The latter is reported much more commonly by renters than by owners. Figures represent average reported number of incidents per respondent. Total Region Tenure Opinion of Occupancy Ordinance West of campus East of campus Remainder of city Owner Renter Support Neutral Oppose Uncontrolled pets running loose 0.51 0.69 0.47 0.45 0.43 0.6 0.58 0.53 0.39 Criminal activity 0.33 0.62 0.34 0.23 0.16 0.54 0.35 0.31 0.27 Disruptive parties 0.36 0.74 0.3 0.24 0.24 0.5 0.35 0.45 0.3 Loud noise other than parties, such as stereos or yelling 0.59 1.12 0.55 0.4 0.37 0.86 0.56 0.66 0.59 Parking vehicles inappropriately 0.66 1.03 0.64 0.53 0.59 0.74 0.71 0.66 0.59 Snow on sidewalks (snow not shoveled) 0.54 0.83 0.66 0.43 0.58 0.49 0.59 0.6 0.36 Trash or junk in the yard 0.49 0.91 0.51 0.34 0.39 0.62 0.59 0.46 0.39 Poorly maintained house 0.36 0.6 0.54 0.25 0.34 0.39 0.41 0.36 0.28 2.3 Packet Pg. 77 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Trends in Neighborhood Quality- Citywide Residents generally rate their neighborhood as having positive qualities Fort Collins Rental and Occupancy Study 25 Neighborhood quality ratings rose from 2004 through 2008 for single- family homes, and have declined since. While this appears to correlate with the increases and decreases in violator households, the pattern was also reported by residents who did not live in proximity to ordinance violators. 84% 81% 87% 58% 89% 85% 90% 68% 85% 75% 82% 54% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Peace and quiet Maintenance of lawns Maintenance of houses Sense of community Percentage of Single Family Homes that Rated Their Neighborhood Good or Very Good 2004 2008 2018 2.3 Packet Pg. 78 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Neighborhood Issues and Ordinance Violators Proximity to suspected ordinance violators is correlated with more incidents of neighborhood issues Fort Collins Rental and Occupancy Study 26 Loud noise and inappropriately parked vehicles stand out as issues that seem associated with proximity, particularly in the area west of campus. Total West of campus- Neighbor(s) violating occupancy ordinance East of campus- Neighbor(s) violating occupancy ordinance Remainder of city- Neighbor(s) violating occupancy ordinance Yes No Yes No Yes No Uncontrolled pets running loose 0.51 1.02 0.54 0.66 0.42 0.77 0.4 Criminal activity 0.31 1.07 0.45 0.93 0.23 0.54 0.14 Disruptive parties 0.36 1.42 0.44 0.7 0.19 0.6 0.18 Loud noise other than parties, such as stereos or yelling 0.59 1.75 0.84 1.49 0.39 0.76 0.35 Parking vehicles inappropriately 0.63 1.78 0.67 1.47 0.49 0.86 0.44 Snow on sidewalks (snow not shoveled) 0.53 1.55 0.47 1.35 0.5 0.87 0.35 Trash or junk in the yard 0.48 1.53 0.58 1.53 0.32 0.91 0.25 Poorly maintained house 0.35 1.07 0.33 1.19 0.42 0.89 0.15 Figures represent average reported number of incidents per respondent. 2.3 Packet Pg. 79 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Executive Summary: Key Findings Neighborhood Quality and Short-Term Rentals Proximity to suspected STRs is correlated with more incidents of neighborhood issues Fort Collins Rental and Occupancy Study 27 The impact is smaller than that seen for ordinance violators, but nonetheless negative impacts are reported, particularly in areas where STRs are not allowed. Figures represent average reported number of incidents per respondent. Total Neighbor(s) operate STRs No STRs allowed- Neighbor(s) operate STRs Primary STRs only- Neighbor(s) operate STRs Yes No Yes No Yes No Uncontrolled pets running loose 0.51 0.82 0.47 0.85 0.47 0.78 0.46 Criminal activity 0.3 0.56 0.26 0.52 0.15 0.68 0.35 Disruptive parties 0.35 0.56 0.33 0.63 0.24 0.55 0.37 Loud noise other than parties, such as stereos or yelling 0.57 0.84 0.54 0.88 0.39 0.91 0.63 Parking vehicles inappropriately 0.63 0.87 0.60 1.03 0.52 0.8 0.66 Snow on sidewalks (snow not shoveled) 0.53 0.77 0.50 1.08 0.51 0.5 0.54 Trash or junk in the yard 0.47 0.67 0.44 0.76 0.38 0.65 0.45 Poorly maintained house 0.35 0.64 0.32 0.71 0.33 0.63 0.32 2.3 Packet Pg. 80 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Introduction 2.3 Packet Pg. 81 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Introduction: Background In 2018, the City of Fort Collins retained Corona Insights to conduct an examination of rental market conditions in Fort Collins, particularly with respect to the City’s occupancy ordinance. The initial research questions were: > Has the occupancy ordinance had an impact on neighborhood quality? y Our conclusions are shown on Page 4 and 7 of the Executive Summary. > Does the occupancy ordinance impact the affordability of housing? y Our conclusions are shown on Page 22 and 26 of the Executive Summary. This report is a followup to two previous studies conducted for the city in 2005 and 2009. The previous studies contained some common elements to this study, but generally had somewhat different emphases. > The 2005 study focused primarily (but not exclusively) on estimating the impacts of the ordinance on the rental market if it were fully enforced, but also included measures of neighborhood quality among single-family home residents. > The 2009 study focused primarily on the impacts of the ordinance enforcement on various constituency groups. It also included a tracking survey of neighborhood quality. > This 2018 report steps back and takes a larger view of the rental market, updates the tracking survey, and provides the first examination of the impact of Short-Term Rentals on the market and on neighborhood quality. The 2018 report also expanded the survey to include all households rather than just single-family home residents. Fort Collins Rental and Occupancy Study 29 2.3 Packet Pg. 82 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Introduction: Occupancy Ordinance The occupancy ordinance states that "Occupancy in a residential dwelling unit (single-family, duplex, and multifamily) is restricted to: one family as defined below (Section 5.1.2) and not more than one additional person; OR one adult and their dependents (if any), a second adult and their dependents (if any), and not more than one additional person.“ The ordinance has existed for many years, but was enforced actively beginning in 2007. Fort Collins Rental and Occupancy Study 30 2.3 Packet Pg. 83 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Introduction: Geographical Analysis Areas Because the occupancy ordinance has been of particular focus in areas near the Colorado State University campus, several analyses in this report break down citywide results into three areas, as shown here. Fort Collins Rental and Occupancy Study 31 2.3 Packet Pg. 84 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Introduction: Report Layout The report addresses housing in terms of overall market trends as well as specific topics. The layout follows the order below. Each sub-section includes unique key findings. Fort Collins Rental and Occupancy Study 32 Section 1. Rental Market Trends Comparisons to Other Colorado Metro Areas Comparison to a Selection of Nationwide Cities Recent Trends in Fort Collins Section 2. Ordinance Violators Estimated Number Profile of Violators Investigation Outcomes Public Sentiment Toward Ordinance Section 3. Short-Term Rentals Profile of Units and Revenues Rental Hosts and Properties Public Sentiment Toward STR Rules Section 4. Neighborhood Quality Citywide Quality Measures Proximity to Ordinance Violators Proximity to Short-Term Rentals 2.3 Packet Pg. 85 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Section 1: Rental Market Trends 2.3 Packet Pg. 86 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 34 Section 1.1 Rental Market Trends Fort Collins Compared to Other Colorado Metro Areas 1.1.1 Change in Demand 1.1.2 Change in Supply 1.1.3 Change in Vacancies 1.1.4 Change in Average Rent 2.3 Packet Pg. 87 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Key Findings: Colorado Comparisons  While population growth in Fort Collins is higher than most comparable areas, the highest rates in the city were concentrated pre-ordinance.  The average size of rental households increased over the long term.  The proportion of homes that were renter-occupied increased over the long term.  Housing supply trends in Fort Collins are largely consistent with other Colorado markets across time periods. The city had a significant decrease in new residential building permits between 2004-2009 that has since rebounded.  While the entire state has seen a decrease in rental vacancy rates over the last two decades, Fort Collins has had a significantly lower (in relative and absolute terms) vacancy rate in the post-ordinance era.  While trends in the cost of rent in Fort Collins were similar to comparable cities pre- ordinance, the rate of increase has been much higher (in relative and absolute terms) in the post-ordinance era. Nonetheless, most comparable Colorado cities have seen a steep increase in rent between 2013-2017. A description of the methodology is found in the appendix. Fort Collins Rental and Occupancy Study 35 2.3 Packet Pg. 88 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 36 Section 1.1.1 Change in Demand 2.3 Packet Pg. 89 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Population growth in Fort Collins is fairly consistent with similar metro areas Fort Collins Rental and Occupancy Study 37 Average Population from State Demographer Average Population 1998-2001 2002-05 2006-09 2010-13 2014-2017 I II III IV V Fort Collins/Loveland 169,179 188,187 202,794 217,593 236,169 Fort Collins 118,195 129,874 138,852 148,360 161,421 Loveland 50,985 58,313 63,942 69,233 74,749 Colorado Springs 359,794 379,203 400,872 430,156 455,163 Grand Junction 45,188 49,417 55,839 61,029 63,677 Greeley 76,804 84,062 89,758 94,571 101,572 Pueblo 140,737 148,286 155,100 160,084 163,532 Population Change I-II II-III III-IV IV-V I-V Fort Collins/Loveland 11% 19,008 8% 14,607 7% 14,800 9% 18,576 40% 66,990 Fort Collins 10% 11,679 7% 8,978 7% 9,508 9% 13,061 37% 43,226 Loveland 14% 7,329 10% 5,629 8% 5,291 8% 5,516 47% 23,764 Colorado Springs 5% 19,409 6% 21,669 7% 29,285 6% 25,007 27% 95,369 Grand Junction 9% 4,229 13% 6,422 9% 5,190 4% 2,648 41% 18,489 Greeley 9% 7,258 7% 5,696 5% 4,813 7% 7,001 32% 24,767 Pueblo 5% 7,548 5% 6,814 3% 4,984 2% 3,448 16% 22,795 2.3 Packet Pg. 90 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins’ population has converged with Pueblo Fort Collins Rental and Occupancy Study 38 0 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 500,000 Population from State Demographer Fort Collins Colorado Springs Grand Junction Greeley Pueblo city Loveland city The last 20 years has seen Fort Collins’ population increase by around 51%. While at the higher end of these similar metro areas, this growth is fairly similar to Grand Junction and Greely, which have both seen an increase of 48% during the same time period. Fort Collins’ convergence with Pueblo is largely the product of a smaller increase of only 23% in the latter. 2.3 Packet Pg. 91 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Population growth rate in Fort Collins is consistent with similar metro areas Fort Collins Rental and Occupancy Study 39 Yearly population growth in Fort Collins is similar to comparable state metro areas. The city’s annual population growth rate was the highest between 1998 and 2001, averaging 3.25%. While the last four years have seen higher rates, Fort Collins’ annual population growth rate has not been above 3% since 2001. -4% -3% -2% -1% 0% 1% 2% 3% 4% 5% 6% Percent Population Change From State Demographer Fort Collins Colorado Springs Grand Junction Greeley Pueblo 2.3 Packet Pg. 92 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The renter population is growing, and so is the average number of people living in rented homes Fort Collins Rental and Occupancy Study 40 Because Fort Collins is a growing community, we would expect the number of rental households to increase, along with number of people living in rental households. However, the more interesting analysis is how rental households are changing within the housing landscape. Over the past ten years, the size of rental households has increased notably from an average of 2.11 people per household to 2.38 people per household. This is a notable increase in size, and essentially means that nearly 8,000 additional people are living in rental unit solely due to this increase in household size. There could be many reasons for this, but affordability is a likely suspect, potentially forcing more roommate situations or delaying home buying for families. Also of interest is the continuing increase of rental households among the population. Comparing the current rate to ten years ago, we can conclude that approximately 950 households are renting now, and in past years would have owned their homes. Era Rental Households Rental Population Average Renter Household Size Proportion of HHouseholds Who Are Renters 2005-2007 23,130 48,790 2.11 43.1% 2010-2012 26,044 59,530 2.29 45.6% 2015-2017 28,871 68,815 2.38 46.4% 2.3 Packet Pg. 93 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 41 Section 1.1.2 Change in Supply 2.3 Packet Pg. 94 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Growth in housing unit supply has increased significantly since 2013 Fort Collins Rental and Occupancy Study 42 This graph normalizes housing supply growth as a percentage of each city's 2006 value, allowing for a more effective comparison. While housing supply in Fort Collins was fairly stagnant between 2005 and 2010 the last five years has seen a higher rate of expansion in housing units. 95% 100% 105% 110% 115% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Total Housing Units as a Percentage of 2006 Value (Three Year Average) Fort Collins Colorado Springs Greeley Pueblo 2.3 Packet Pg. 95 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Housing development in Fort Collins bottomed out in 2009 Fort Collins Rental and Occupancy Study 43 The US Census’ Building Permits Survey shows that the creation of new housing units in Fort Collins was in decline before the 2008 housing crisis and reached its nadir in 2009. The increase seen in overall housing units after 2013 is mirrored in the growth of newly authorized units. 0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 New Privately Owned Housing Units Authorized in Fort Collins Metro Area Total Single Family Units 2.3 Packet Pg. 96 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Growth in renter occupied units is consistent with similar metro areas Fort Collins Rental and Occupancy Study 44 80% 90% 100% 110% 120% 130% 140% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Renter Occupied Units as a Percentage of 2005 Value Fort Collins Colorado Springs Greeley Pueblo All four Colorado metro areas have seen a steady increase in renter occupied units. The increase in renter occupied units is coming from both increases in housing units and a decrease in home ownership rate. 2.3 Packet Pg. 97 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 45 Section 1.1.3 Change in Vacancies 2.3 Packet Pg. 98 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Colorado Springs and Greeley are converging to Fort Collins’ high occupancy rate Fort Collins Rental and Occupancy Study 46 80% 85% 90% 95% 100% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Percentage of Housing Units Occupied Fort Collins Colorado Springs Greeley Pueblo These Census data, which combine the rental and owner housing markets, show that occupancy rates in Fort Collins have historically been higher than similar metro areas. More than 95% of all Fort Collins’ housing units have been occupied since 2010 2.3 Packet Pg. 99 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Renters are making up a higher percentage of occupied units in Fort Collins Fort Collins Rental and Occupancy Study 47 30% 35% 40% 45% 50% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Percentage of Occupied Housing Units Occupied by Renters (Three Year Average) Fort Collins Colorado Springs Greeley Pueblo Compared to similar metro areas in the state, Fort Collins has had a high percentage of renters in occupied units. The state-wide increase in renting could be attributed to the 2008 financial crisis and increasing costs of home ownership post-recession 2.3 Packet Pg. 100 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Colorado has seen a steep increase in home values over the last six years Fort Collins Rental and Occupancy Study 48 While median home values in Fort Collins were largely stagnant between 2005 and 2011, the next six years saw about a 50% increase. While all four metro areas had significant increases in home values between 2005 and 2017, Fort Collins demonstrated the largest percentage with the median home value increasing from $229,700 to $366,500 80% 90% 100% 110% 120% 130% 140% 150% 160% 170% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Median Home Value as a Percentage of 2005 Value Fort Collins Colorado Springs Greeley Pueblo 2.3 Packet Pg. 101 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Sale-to-list price in Fort Collins has been increasing over the last few years Fort Collins Rental and Occupancy Study 49 96% 97% 98% 99% 100% 101% 102% 2012 2013 2014 2015 2016 2017 2018 Sale-to-List Price for Residential Homes Fort Collins West of Campus East of Campus Away from Campus Detailed home sale data is only available after 2011 for Fort Collins. The last few years have seen home buyers paying a higher percentage of list price. While the sale-to-list price for neighborhoods east of campus appear lower than others, it is important to note that this data is based exclusively on the “University Park” area. Neighborhood data is calculated from the following areas. West of Campus (Avery Park, Brown Farm, Old Town West, P.O.E.T., Prospect, Rogers Park, and Shields). Away from Campus (Downtown, English Ranch, Foxstone, Huntington Hills, Miramont, Side Hill, The Landings, and Troutman Park. East of Campus (University Park). 2.3 Packet Pg. 102 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Sale-to-list price in Fort Collins has been increasing over the last few years Fort Collins Rental and Occupancy Study 50 Average monthly home sales west of campus are very similar to those in neighborhoods away from campus over the last few years. Sales in the University Park area have converged with average rates in other areas of Fort Collins over time. Neighborhood data is calculated from the following areas. West of Campus (Avery Park, Brown Farm, Old Town West, P.O.E.T., Prospect, Rogers Park, and Shields). Away from Campus (Downtown, English Ranch, Foxstone, Huntington Hills, Miramont, Side Hill, The Landings, and Troutman Park. East of Campus (University Park). 0 2 4 6 8 10 12 14 2012 2013 2014 2015 2016 2017 2018 Average Monthly Home Sales Per Neighborhood West of Campus East of Campus Away from Campus 2.3 Packet Pg. 103 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Multifamily vacancy rates in Fort Collins are low across unit types Fort Collins Rental and Occupancy Study 51 0 5 10 15 20 25 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Fort Collins Multifamily Unit Rental Vacancy Rate by Unit Type Efficiency One Bedroom Two Bed, One Bath Two Bed, Two Bath Three Bedroom All Rental vacancy rates in Fort Collins steadily decreased across all unit types between 2004 and 2012 and have remained consistently below 5% since. While three bedroom units experienced significantly higher vacancy rates in the mid 2000s, they have converged to the average rate in the city. 2.3 Packet Pg. 104 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Vacancy rates in Fort Collins follow a similar trend to comparable metro areas, but are lower in the post- ordinance era Fort Collins Rental and Occupancy Study 52 0 2 4 6 8 10 12 14 16 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Multifamily Rental Vacancy Rates (One Year Average) Fort Collins/Loveland Average of Four Comparable Markets The four comparable metro areas have demonstrated a similar, but less extreme, decline in rental vacancy rates. Fort Collins has spent most of the post- ordinance era having a significantly lower rental vacancy rate than similar Colorado markets, although appear to be converging lately. 2.3 Packet Pg. 105 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Recent vacancy rates in Fort Collins have been lower than similar cities Fort Collins Rental and Occupancy Study 53 Average Vacancy Rates - Multi-Family Units Average Vacancy Rate 1998-2001 2002-05 2006-09 2010-13 2014-2017 I II III IV V Fort Collins/Loveland 3% 12% 7% 4% 3% Colorado Springs 5% 11% 10% 6% 5% Grand Junction 5% 7% 4% 9% 4% Greeley 3% 10% 7% 4% 3% Pueblo 5% 8% 8% 10% 5% Average Vacancy Rate Change I-II II-III III-IV IV-IV I-V Fort Collins/Loveland 8.6 -5.1 -3.0 -1.2 -0.7 Colorado Springs 6.3 -0.6 -3.9 -0.8 0.9 Grand Junction 2.1 -3.5 5.0 -4.9 -1.3 Greeley 7.0 -3.0 -3.1 -1.4 -0.5 Pueblo 3.6 -0.4 1.8 -5.2 -0.3 2.3 Packet Pg. 106 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Total renter vacancy rates in Fort Collins are very low Fort Collins Rental and Occupancy Study 54 0 2 4 6 8 10 12 14 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Total Rental Vacancy Rate (Three Year Average) Fort Collins Colorado Springs Greeley Pueblo Examining the total rental vacancy rate (single and multifamily homes) from the Census confirms the trends observed in the Colorado Department of Housing data. Fort Collins has had a lower rental vacancy rate than similar markets in the post-ordinance era. The decrease between 2008 and 2011 has led to an extremely tight rental market with few vacant rental units. 2.3 Packet Pg. 107 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 55 Section 1.1.4 Change in Average Rent 2.3 Packet Pg. 108 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Across unit types, average rent in Fort Collins has nearly doubled over the last 20 years Fort Collins Rental and Occupancy Study 56 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 $1,800 Fort Collins Rent by Multifamily Unit Type Efficiency One Bedroom Two Bed, One Bath Two Bed, Two Bath Three Bedroom Rent in Fort Collins is increasing across all unit types. Efficiencies and three bedroom units have seen the largest percentage increase over the last two decades. 2009-2018 saw a 56% increase in the average rent of all unit types. This is significantly higher than the 18% increase observed between 1999-2008. 2.3 Packet Pg. 109 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Average rent increased in Fort Collins at a higher rate than similar metro areas, especially between 2006-2013 Fort Collins Rental and Occupancy Study 57 Rental Prices - Multi-Family Units Average Rent 1998-2001 2002-05 2006-09 2010-13 2014-2017 I II III IV V Fort Collins/Loveland $656.90 $733.22 $799.85 $956.93 $1,237.35 Colorado Springs $613.51 $665.32 $700.37 $768.00 $970.91 Grand Junction $465.27 $486.76 $620.62 $626.14 $514.95 Greeley $537.49 $606.97 $630.59 $680.35 $942.25 Pueblo $434.08 $479.29 $513.34 $567.87 $655.00 Rental Price Change I-II II-III III-IV IV-V Total Change I-V Fort Collins/Loveland 12% $76.33 9% $66.63 20% $157.08 29% $280.41 88% $580.45 Colorado Springs 8% $51.80 5% $35.05 10% $67.63 26% $202.92 58% $357.40 Grand Junction 5% $21.49 28% $133.86 1% $5.52 -18% -$111.19 11% $49.68 Greeley 13% $69.48 4% $23.62 8% $49.76 38% $261.90 75% $404.76 Pueblo 10% $45.20 7% $34.05 11% $54.54 15% $87.13 51% $220.92 Breaking down the change in average rent across four year segments illustrates how Fort Collins’ rent compares to similar metro areas in the state. The percentage change from era I to II shows that Fort Collins followed a similar pattern of steady increase seen across the state. More recently, the change between IV and V shows most metro areas experiencing a steep increase in rental prices. The main period where the Fort Collins’ market appears to be unique is the change between III and IV. Here the rate of change is double that of comparable cities. 2.3 Packet Pg. 110 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Average rent in Fort Collins increased at a higher rate than similar metro areas Fort Collins Rental and Occupancy Study 58 $200 $400 $600 $800 $1,000 $1,200 $1,400 Average Rent of Multifamily Units by Market Area Fort Collins/Loveland Colorado Springs Grand Junction Greeley Pueblo While rent in Fort Collins has always been higher than comparable metro areas, the last decade has seen rent in the city increase at a faster rate. All metro areas, except for Grand Junction, have seen steep increases in multi- family unit rent in recent years. 2.3 Packet Pg. 111 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Post 2005 rent has increased in Fort Collins at a higher rate than similar metro areas Fort Collins Rental and Occupancy Study 59 80% 90% 100% 110% 120% 130% 140% 150% 160% 170% 180% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Average Multifamily Rent as a Percentage of 2005 Rent Fort Collins/Loveland Colorado Springs Grand Junction Greeley Pueblo Examining average rent as a percentage of each city’s 2005 value confirms the previously identified pattern. While recent years have brought increased rents across the state, Fort Collins has experienced the most significant rise in rental costs. 2.3 Packet Pg. 112 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Calculating total median rent from the Census confirms the trend Fort Collins Rental and Occupancy Study 60 $400 $500 $600 $700 $800 $900 $1,000 $1,100 $1,200 $1,300 $1,400 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Average Median Gross Rent by Market Area From Census Fort Collins Colorado Springs Greeley Pueblo Examining total median rent (single and multifamily homes) from the Census confirms the trends observed in the Colorado Department of Housing data. Fort Collins has historically had higher rental costs than comparable metro areas, but has also seen the largest increase during this period - 68% compared to an average of 48% for the three comparable cities. 2.3 Packet Pg. 113 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Despite similar population trends, rent in Fort Collins increased at a higher rate than similar areas post- ordinance Fort Collins Rental and Occupancy Study 61 Population and Multifamily Unit Rent Change Pre and Post-Ordinance Average Yearly Change in Rent Average Yearly Change in Population 1997-2005 2006-14 Difference 1997-2005 2006-14 Difference Fort Collins/Loveland 2.76% 5.28% 2.51% 2.70% 1.92% -0.77% Colorado Springs 2.73% 2.60% -0.14% 1.45% 1.49% 0.04% Grand Junction 1.52% -0.89% -2.42% 2.01% 1.88% -0.12% Greeley 2.63% 3.54% 0.91% 2.53% 1.39% -1.14% Pueblo 1.34% 2.49% 1.15% 1.34% 0.72% -0.62% Average change calculated: (last year/first year)^(1/# years in period)  The geographic and temporal coverage of the Colorado Department of Housing’s data allow for an assessment of pre and post-ordinance trends. The table below shows average yearly changes in population and multifamily rent in two eight year periods before and after the ordinance. In its 2009 report, Corona Insights identified 2006 as the first year that ordinance affected the rental market due to the start of education and registration efforts.  The table demonstrates that rental costs in Fort Collins grew at a very similar rate to comparable metro areas pre-ordinance. However, rent increased at a much faster rate post-ordinance. A decrease in the average yearly change in population shows that this change is not likely due to a increase in housing demand unique to Fort Collins. 2.3 Packet Pg. 114 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 62 Section 1.2 Rental Market Trends Fort Collins Compared to Selected Nationwide Cities 2.3 Packet Pg. 115 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Key Findings: Nationwide Comparisons  While population growth in Fort Collins was higher than comparable national cities in the 1990s, it has regressed toward the mean in the post-ordinance era.  Fort Collins’ housing supply increased at a relatively high rate in the 1990s, but is near average in the post-ordinance era. Housing stock growth is lower across all comparable cities.  The rate that renters have occupied housing units in Fort Collins is higher in absolute and relative terms post-ordinance.  Fort Collins’ rental vacancy rates are lower (in relative and absolute terms) than similar cities in the post ordinance era.  Fort Collins’ expansion in demand (population growth) has exceeded supply (housing units).  Rental costs in Fort Collins have increased at a faster rate than similar national cities in the post-ordinance era. Fort Collins also had a high increase in rent in the 1990s. A description of the methodology is found in the appendix. Fort Collins Rental and Occupancy Study 63 2.3 Packet Pg. 116 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) How to read a box plot Fort Collins Rental and Occupancy Study 64 outlier maximum third quartile median first quartile mean minimum  Box plots offer a quick and effective way to identify differences between groups of populations.  They show the median value of each population (marked with a line) and a surrounding box that stretches from the 25th to 75th percentile. The “middle half ” of observations are contained in the box.  The “whiskers” show the range of the top and bottom 25% of observations respectively. If an observation has a value that is more than 1.5 times the interquartile range (the distance between the 75th and 25th percentile value), it is deemed an outlier.  The City of Fort Collins logo shows where the city falls on the distribution. 2.3 Packet Pg. 117 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins’ population growth has regressed toward the mean Fort Collins Rental and Occupancy Study 65 Fort Collins Values: 3.06%, 2.33% Average population growth has generally declined across the case study cities. Fort Collins’ population growth rate has decreased in absolute relative terms. While the city’s rate was previously at the higher end of the distribution in the 1990s, it is well within the middle half in the modern era. 2.3 Packet Pg. 118 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The rate of Fort Collins’ housing stock growth has significantly decreased Fort Collins Rental and Occupancy Study 66 Fort Collins Values: 3.05%, 0.84% While Fort Collins had the highest rate of housing unit change in the 1990s, this value has decreased in absolute and relative terms. Given the 2008 housing crisis and subsequent recession, there is a significantly lower rate of housing unit change between 2005-2017 for the entire sample. Nonetheless, Fort Collins went from pacing this group in the first time period to the median in the second. 2.3 Packet Pg. 119 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins’ housing growth lags population growth Fort Collins Rental and Occupancy Study 67 Fort Collins, Colorado Lakewood, Colorado Joliet, Illinois Fort Wayne, Indiana Lincoln, Nebraska Durham, North Carolina Greensboro, North Carolina Raleigh, North Carolina Winston-Salem, North Carolina Eugene, Oregon Salem, Oregon Columbia, South Carolina Sioux Falls, South Dakota Provo, Utah Pueblo, Colorado Colorado Springs, Colorado Greeley, Colorado 0% 10% 20% 30% 40% 50% 60% 0% 5% 10% 15% 20% 25% 30% 35% Change in Population 2005-2017 Change in Housing Units 2005-2017 Supply and Demand Trends in the Housing Market This graph plots the change in population and housing units between 2005-2017. The Colorado markets from the previous section are added for reference. The trendline shows the average relationship between supply and demand. Fort Collins and Columbia are notable outliers in that their population growth (demand) exceeds growth in housing units (supply). 2.3 Packet Pg. 120 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) In general, the percentage of renters is on the rise Fort Collins Rental and Occupancy Study 68 Fort Collins Values: -4.39%, 2.43% As a group, the percentage of occupied units by renters is on the rise amongst the comparison cities. Fort Collins has seen both an absolute and relative increase in the rate of renters in occupied units in the modern era. This dynamic has the potential to lower rental vacancy rates and raise the cost of rent, but does not appear to be unique to Fort Collins. 2.3 Packet Pg. 121 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Change in Fort Collin’s rental vacancy rates appears average. Note:Study Data limitations reduce sample by six cities. Fort Collins Rental and Occupancy 69 As in the previous state analysis, this comparison demonstrates a general trend in decreasing rental vacancy rates across markets. While Fort Collins appears to be at the center of each distribution, it is important to remember that these plots are reporting a measurement of change. Unlike population and housing units, vacancy rates are subject to ceiling and floor effects. Once value approaches the floor (0% rental vacancy rate), change becomes less likely. Fort Collins Values: -0.4% , -3.24% 2.3 Packet Pg. 122 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) However, Fort Collins’ vacancy rates are subject to a “floor effect” Fort Collins Rental and Occupancy Study 70 Comparing the 2007 and 2017 rental vacancy rates demonstrates that, while the change in these rates is average for this sample, the absolute values are toward the bottom of the distribution. Again, data show that Fort Collins rental market has been extremely tight in recent years with very few vacant rental units. Fort Collins Values: 5.96%, 2.72% Note: Data limitations reduce sample by six cities. 2.3 Packet Pg. 123 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Rent continues to grow at a relatively high rate in Fort Collins Fort Collins Rental and Occupancy Study 71 Fort Collins Values: As with the state analysis, Fort 5.02% 4.06% Collins’ rate of rent increase is at the high end of the distribution in the modern era. However, this is not necessarily out of the ordinary for this sample as the city was also at the high end of the distribution in the 1990s. Overall, the rate of change in median rent is lower in the modern era. This trend may be attributed to the great recession. 2.3 Packet Pg. 124 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins’ rent increase is unmatched by comparable national cities Fort Collins Rental and Occupancy Study 72 90% 100% 110% 120% 130% 140% 150% 160% 170% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Median Gross Rent as a Percentage of 2006 Value (Three Year Average) Fort Collins, Colorado Lakewood, Colorado Joliet, Illinois Fort Wayne, Indiana Lincoln, Nebraska Durham, North Carolina Greensboro, North Carolina Raleigh, North Carolina Winston-Salem North Carolina Eugene, Oregon Salem, Oregon Columbia, South Carolina Sioux Falls, South Dakota Mesquite, Texas Provo, Utah The dramatic increase of rent in Fort Collins between 2005-2017 is unique in the sample of comparable cities. The previously observed increase in rent amongst Colorado cities post 2013 is exhibited by Lakewood having a significant increase in rent over the last few years as well. 2.3 Packet Pg. 125 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Changes in rent appear to be (in part) a product of supply and demand Fort Collins Rental and Occupancy Study 73 Fort Collins, Colorado Lakewood, Colorado Joliet, Illinois Fort Wayne, Indiana Lincoln, Nebraska Durham, North Carolina Greensboro, North Carolina Raleigh, North Carolina Winston-Salem, North Carolina Eugene, Oregon Salem, Oregon Columbia, South Carolina Sioux Falls, South Dakota Provo, Utah Pueblo, Colorado Colorado Springs, Colorado Greeley, Colorado 0% 10% 20% 30% 40% 50% 60% 70% 80% 024681012141618 Percent Change in Gross Median Rent New People Per New Housing Unit The X axis of this plot Demand/Supply and Median Gross Rent Change 2005-2017 calculates the increase in population divided by the increase in housing units between 2005-2017. During this time period, Fort Collins has had 6.6 new individuals for every new housing unit. Lakewood is a notable outlier due to a very small (1%) increase in housing units. The trendline demonstrates a relationship between excess demand and higher median rents. Colorado market analysis cities are included for reference. 2.3 Packet Pg. 126 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Changes in rent appear to be (in part) a product of supply and demand (removing Lakewood as an outlier) Fort Collins Rental and Occupancy Study 74 Fort Collins, Colorado Joliet, Illinois Fort Wayne, Indiana Lincoln, Nebraska Durham, North Carolina Greensboro, North Carolina Raleigh, North Carolina Winston-Salem, North Carolina Eugene, Oregon Salem, Oregon Columbia, South Carolina Sioux Falls, South Dakota Provo, Utah Pueblo, Colorado Colorado Springs, Colorado Greeley, Colorado 0% 10% 20% 30% 40% 50% 60% 70% 80% 0123456789 Percent Change in Gross Median Rent New People Per New Housing Unit Supply/Demand and Median Gross Rent Change 2005-2017 The main conclusions of the previous plot are preserved when Lakewood is removed. Fort Collins’ 6.6 new individuals per new housing unit is significantly higher than the remaining sample’s average of 4.4. However, it is notable that Fort Collins lies substantially above the trendline in this plot. This location suggests that demand/supply is only one cause, amongst others, of the high rents in the city. 2.3 Packet Pg. 127 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Increase in rent has been mirrored by home values Fort Collins Rental and Occupancy Study 75 Fort Collins Values: 92%, 60% In general, the home values in the modern era increased at a lower rate than they did in the 1990s. The lower rate is likely a product of the 2008 housing crisis and subsequent recession. While the rate in Fort Collins decreased in absolute terms, it has increased relatively toward the high end of the distribution. 2.3 Packet Pg. 128 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins and Lakewood follow similar trajectories in home values Fort Collins Rental and Occupancy Study 76 90% 100% 110% 120% 130% 140% 150% 160% 170% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Percent of 2005 Median Home Values Fort Collins, Colorado Lakewood, Colorado Average of 13 other cities The recent trend of increasing rent in Colorado has also been present in median home values. While Fort Collins and Lakewood show a distinct and drastic increase in median home values after 2011, they previously lagged comparable cities. 2.3 Packet Pg. 129 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 77 Section 1.3 Rental Market Trends Recent Trends in Fort Collins 2.3 Packet Pg. 130 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Key Findings: Recent Trends in Fort Collins  Across the last six years, around 12% of rented homes have had four or more occupants. These households could have related occupants or otherwise not be in violation of the occupancy ordinance, so this does not indicate that 12% of rented homes are occupancy ordinance violators.  Rented homes with four or more bedrooms is relatively uncommon, typically around 12%.  A typical rented home has about 1.6 to 1.7 cars available  Over time, the proportion of homes in multi-unit structures stayed about the same Fort Collins Rental and Occupancy Study 78 2.3 Packet Pg. 131 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The proportion of rented homes with four or more occupants hovered around 12% The proportion of rented homes with four or more occupants varied around 12%, but did not steadily increase. 79 3,201 4,488 2,440 3,049 3,781 3,180 22,345 23,733 22,182 23,939 24,918 26,572 13% 16% 10% 11% 13% 11% 0% 25% 50% 75% 100% 0 10,000 20,000 30,000 40,000 2011 2012 2013 2014 2015 2016 Number of Rentals by Number of Occupants Per Household # rented homes with 1 to 3 people # rented homes with 4+ people % rented homes with 4+ people (right axis) Fort Collins Rental and Occupancy Study 2.3 Packet Pg. 132 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The proportion of rented homes with four or more bedrooms dipped slightly in 2016 The proportion of rented homes with four or more bedrooms bounced around 12% but did not steadily increase. The pattern of rented home with four or more bedrooms was similar to the proportion of rented homes with four or more occupants. 80 3,352 3,969 2,963 3,623 3,405 2,493 22,194 24,252 21,659 23,365 25,294 27,259 13% 14% 12% 13% 12% 8% 0% 25% 50% 75% 100% 0 10,000 20,000 30,000 40,000 2011 2012 2013 2014 2015 2016 Number of Rentals by Number of Bedrooms Per Household # rented homes with 0 to 3 bedrooms # rented homes with 4+ bedrooms % rented homes with 4+ bedrooms (right axis) Fort Collins Rental and Occupancy Study 2.3 Packet Pg. 133 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The proportion of homes rented by non-families increased very slightly from 2011 In 2016, about 66% of rented homes were rented by nonfamilies, which is typically defined as no one in the household is related. This proportion was slightly larger than estimates from 2011 (62%) and 2012 (63%) but similar to estimates from 2013 to 2015. Based on 3-year running averages, there was a very slight increasing trend in the percentage of nonfamily rentals. 81 9,656 10,301 7,697 8,525 9,201 10,203 15,890 17,920 16,925 18,463 19,498 19,549 62% 63% 69% 68% 68% 66% 0% 25% 50% 75% 100% 0 10,000 20,000 30,000 40,000 2011 2012 2013 2014 2015 2016 Number of Rentals by Household Family Status Nonfamily rentals Family rentals % nonfamily (right axis) Fort Collins Rental and Occupancy Study 2.3 Packet Pg. 134 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) There have been about 1.6 to 1.7 cars available per rented household since 2011 The number of cars available per rented household bounced around 1.6 and 1.7, but it did not substantially change in a sustained pattern between 2011 and 2016. 82 40,568 46,368 42,233 45,155 48,156 48,490 1.6 1.6 1.7 1.7 1.7 1.6 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 2.0 0 10,000 20,000 30,000 40,000 50,000 60,000 2011 2012 2013 2014 2015 2016 Cars Available to Renters and Cars Per Rented Household Total Cars Available to Renters Cars Per Rented Household (right axis) Fort Collins Rental and Occupancy Study 2.3 Packet Pg. 135 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Over time, the proportion of homes in multi-unit structures stayed about the same Since pre-2010, the proportion of all homes in multi-unit structures (e.g., apartments, duplexes, etc.) stayed about the same throughout Fort Collins and by region. 83 46% 48% 35% 39% 35% 35% 32% 31% 0% 25% 50% 75% 100% 2005-2009 2008-2012 2012-2016 Proportion of Homes that are Multi-Unit West of Campus East of Campus Fort Collins Away from Campus Fort Collins Rental and Occupancy Study 2.3 Packet Pg. 136 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) School children (nursery-12) make up a smaller percentage of population in the areas around campus post-ordinance Fort Collins Rental and Occupancy Study 84 Due to changing geographic boundaries, Census tract 2 is treated as “Away from Campus” in these calculations. It was split into two areas (one away and one West) in the 2010 census. 17% 16% 11% 8% 14% 12% 20% 19% 0% 10% 20% 30% 40% 50% 60% 2000 2006-10 2011-15 Percentage of Population Enrolled in Nursery School -12th Grade Fort Collins West of Campus East of Campus Away from Campus 21% 23% 42% 51% 18% 21% 12% 13% 0% 10% 20% 30% 40% 50% 60% 2000 2006-10 2011-15 Percentage of Population Enrolled in College - Graduate School Fort Collins West of Campus East of Campus Away from Campus Enforcement of the ordinance has not particularly changed the composition of neighborhoods around campus, as measured by the population of children. The areas around campus have seen a small increase in college students and a small decrease in school children (nursery -12th grade) over the past 15 years, though most of that change occurred pre-enforcement. 2.3 Packet Pg. 137 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The price of median home sales has been significantly increasing across neighborhoods in Fort Collins Fort Collins Rental and Occupancy Study 85 The median home in Fort Collins sold for $155,000 more in 2018 than it did in 2012, a 67% increase. While home values east of campus appear to increase dramatically after 2015, this is based exclusively on data available from the University Park neighborhood. Neighborhood data is calculated from the following areas. West of Campus (Avery Park, Brown Farm, Old Town West, P.O.E.T., Prospect, Rogers Park, and Shields). Away from Campus (Downtown, English Ranch, Foxstone, Huntington Hills, Miramont, Side Hill, The Landings, and Troutman Park. East of Campus (University Park). $150 $200 $250 $300 $350 $400 $450 $500 $550 $600 2012 2013 2014 2015 2016 2017 2018 Median Home Sale Price in Thousands Fort Collins West of Campus East of Campus Away from Campus 2.3 Packet Pg. 138 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Renters have been filling occupied units at higher rates across neighborhoods Report Name/Customer/Project 86 60% 63% 53% 57% 44% 46% 41% 42% 0% 25% 50% 75% 100% 2008-2012 2013-2017 Percentage of Occupied Units by Renters West of Campus East of Campus Fort Collins Away from Campus While the percentage of renters in occupied units has been increasing across all neighborhoods, the largest increase has been seen around campus. 2.3 Packet Pg. 139 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The percentage of four or more person rental households has decreased around campus Report Name/Customer/Project 87 15% 10% 14% 6% 13% 13% 12% 13% 0% 25% 50% 2008-2012 2013-2017 Percentage of Renter Occupied Units that are Four or More Person Households West of Campus East of Campus Fort Collins Away from Campus While the percentage of occupied rental households with four or more people has remained constant in the City at large, it has decreased in the areas around campus. The areas around campus have seen a decrease of renters in one person households and an increase of renters in two person households. 2.3 Packet Pg. 140 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Section 3. Occupancy Ordinance Violators 2.3 Packet Pg. 141 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 89 Section 2.1 Occupancy Ordinance Violators Estimated Number of Violator Households 2.3 Packet Pg. 142 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Key Findings: Number of Violator Households  The number of violator households is estimated at slightly more than 1,200 households. This is notably higher than the figure estimated in 2009, and approximately the same number that was estimated in 2005. A description of the methodology is found in the appendix. Fort Collins Rental and Occupancy Study 90 2.3 Packet Pg. 143 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Estimating the Number of Violator Households Two approaches were used to estimate the number of households that are living in violation of the occupancy ordinance. The first estimate examined data reported by respondents in the public survey when asked how many of the four houses nearest to their home were in violation of the ordinance. The figures were then multiplied by the current rate at which occupancy violation investigations found such violations. (In other words, 38% of occupancy ordinance complaints were found to be valid.) A high estimate counted every home that was reported in the survey (scaled up to the population of homes), and a low estimates assumed that any reported number greater than one was equal to one. A second estimate was developed using self-reported data from the census documents. These figures include a high estimate that assumed that all violator households lived within the city of Fort Collins, and a low estimate that assumed that violator households were equally likely inside the city and in the rural areas outside the city. (The particular census source extends beyond the city limits to include much of rural northern Larimer County.) The four estimates were then averaged to develop an overall estimate of the number of violator households at 1,234. See the next page for the figures.) Fort Collins Rental and Occupancy Study 91 2.3 Packet Pg. 144 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Slightly more than 1,200 households are in violation of the occupancy ordinance Using these two methods, the estimated number of violator households is 1,234, with an average household size of 5.06 people. Fort Collins Rental and Occupancy Study 92 Survey Data Census Data High Range 4,291 x Violator Households Low Range 2,727 x Violator Households Substantiation Rate 38% x Occupancy Investigations High Range 1,630 1,285 Estimated Violator Housholds Low Range 1,036 986 Estimated Violator Housholds Estimate 1,234 Average Household Size - 5.06 people 2.3 Packet Pg. 145 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The number of violators has fluctuated over time In comparing the last three studies (completed in 2005, 2009, and 2018), the number of violators has fluctuated. Prior to active enforcement of the ordinance, the 2005 study estimated that slightly more than 1,200 households were in violation. After the ordinance enforcement began, the figures dropped to approximately 650. However, since that time period, the number has risen again, back to the pre- enforcement levels. (Note that the population has grown, so the overall incidence rate is lower now.) As is discussed elsewhere, a strong theory is that affordability issues may be causing more households to violate the ordinance. Fort Collins Rental and Occupancy Study 93 2.3 Packet Pg. 146 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 94 Section 2.2 Occupancy Ordinance Violators Profile of Violator Households 2.3 Packet Pg. 147 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Key Findings: Profile of Violator Households  The makeup of residents in violator households has changed notably, going from 71% college students to 44% college students since 2005. Children under 18 now make up roughly 13% of these households, despite being a negligible population in 2005.  The public is very aware of the ordinance (89%), and more likely to support the ordinance than oppose it (42% versus 24%). However, 78% say that it has no impact on their neighborhood. A description of the methodology is found in the appendix. Fort Collins Rental and Occupancy Study 95 2.3 Packet Pg. 148 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) A slight majority of violator households are rentals Violator households are nearly evenly split between single family and multi-family homes. Violators who own their home are nearly all in single-family homes, while violators who rent their homes are evenly split between single-family and multi-family units.. Fort Collins Rental and Occupancy Study 96 Owned Home Rented Home Single-Family Home 560 343 Multi-Family Home 6 326 Owned Home Rented Home Single-Family Home 45% 28% Multi-Family Home 1% 26% 2.3 Packet Pg. 149 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Violator households tend to share larger homes Most violator households live in 4-bedroom units. This implies that most violator households are not living in overcrowded conditions inside the home. Fort Collins Rental and Occupancy Study 97 2.3 Packet Pg. 150 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Violator households tend to live in single family homes As might be expected from the finding on the previous page about the sizes of violator households’ homes, most violator households live in single family homes (meaning houses that are detached from other houses). Among those who live in apartments, most live in smaller developments. Fort Collins Rental and Occupancy Study 98 2.3 Packet Pg. 151 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Violator households are higher on the rent spectrum Because they tend to live in larger housing unit, violator households also tend to pay higher rents. However, the rent is split between more independent payers. Fort Collins Rental and Occupancy Study 99 2.3 Packet Pg. 152 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Violator households tend to have more vehicles. Violator households have notably more vehicles than other types of households. This is an important distinction because, as seen elsewhere in this report, inappropriately parked vehicles tend to be a common complaint by Fort Collins residents with respect to neighborhood quality, and it would be a consistent issue to observe by residents. Fort Collins Rental and Occupancy Study 100 2.3 Packet Pg. 153 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Tenant relationships are generally non-blood Violator households are usually groups of unrelated people.* Less than 40% consist of groups where at least two people are related to each other. This would imply that nuances to the definition of the ordinance might have an impact on some households, but not the majority. Fort Collins Rental and Occupancy Study 101 * - Relationships are for the person filling out the census form. Others in the household could possibly be related. 2.3 Packet Pg. 154 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Relationships When there are related people in the household, the related person is often a child. Children are present in violator households at a very similar rate to their presence in non-violator households (27%). This may suggest younger families that are bringing in others to help with housing costs. Fort Collins Rental and Occupancy Study 102 2.3 Packet Pg. 155 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Violator households generally form quickly or move frequently Nearly half of all violator households have lived in their home for less than a year. This is an important item to consider, because conflicts may be more likely to occur with new residents who haven’t yet integrated into a neighborhood or who introduce change to a neighborhood. Fort Collins Rental and Occupancy Study 103 2.3 Packet Pg. 156 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) There is no relationship of household income to violator status Violator households fall into three main income groups: one-third fall into lower household income segments (which is the combined income of all residents of the home), while slightly more than one-third have combined incomes of $100,000 or more. The remainder fall into the income bank in between. Fort Collins Rental and Occupancy Study 104 2.3 Packet Pg. 157 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Violator households are often young adults Forty percent of the residents living in violator households are young adults between the ages of 18 and 21. Conversely, very few residents of violator households are age 50 or older. As is discussed later in this section of the report, non-students tend to be older than college students. A new population that is emerging in the violator population is children under the age of 18, who were negligible in the 2005 study and now represent 1 in 8 violators. Fort Collins Rental and Occupancy Study 105 50-50 split of males and females 2.3 Packet Pg. 158 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) College students represent nearly half the violator population A slight majority of residents in violator households are college students, with the bulk being undergraduates. This represents a notable change from the initial 2005 study, which showed that 71% of residents in violator households were college students. Fort Collins Rental and Occupancy Study 106 Ten percent of residents are enrolled in primary or secondary school. This figure is lower than the number of children in those households because some children are not yet of school age. 2.3 Packet Pg. 159 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) College students are younger, while non-students are older If we examine violator household members by both age and college student status, we see the that most common segment is college students age 18 to 21. However, the next two largest segments are non-students over the age of 25, with a particular concentration of non-students between the ages of 25 and 34. Fort Collins Rental and Occupancy Study 107 2.3 Packet Pg. 160 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Residents of violator households are generally working This analysis was intended to assess whether significant numbers of residents in violator households were unable to work. Recognizing that many college students may not be in the work force, we see that a majority of residents are working, and relatively few are disabled or receiving any type of public assistance. Fort Collins Rental and Occupancy Study 108 5% are disabled 4% receive SNAP 0% receive public assistance payments 2.3 Packet Pg. 161 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 109 Section 2.3 Occupancy Ordinance Violators Investigation Outcomes • 2.3.1 Citywide Trends • 2.3.2 Neighborhood Trends 2.3 Packet Pg. 162 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Key Findings: Investigation Outcomes  There was notable year to year variation in the number of over occupancy investigations.  Citywide, the number of investigations trended upward, while the number of violations remained about the same; thus, the percentage of investigations with unfounded outcomes increased.  The greatest number of violations were in the West of Campus region.  The highest violation per home ratio was in the West of Campus region. > Two-thirds of occupancy violations occur in the area west of campus, despite the fact that the area represents only 23% of homes in the city.  The proportion of violations increased in the West of Campus region, from 57% of all violations in 2011 to 68% of all violations in 2017.  The greatest number of unfounded cases were in the Away from Campus region. A description of the methodology is found in the appendix. Fort Collins Rental and Occupancy Study 110 2.3 Packet Pg. 163 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 111 Section 2.3.1 Citywide Trends 2.3 Packet Pg. 164 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The number of over occupancy investigations increased, but the number of violations did not change The number of investigations varied substantially from year to year, with a low of 84 investigations in 2011 and a high of 204 investigations in 2016. Based on a two-year running average (the average of the current and prior years), there was an increase in the number of investigations between 2012 and 2017. However, there was not a trending increase in violations, based on a two- year running average, which is represented in the chart below with dotted lines. 112 46 88 42 74 62 76 47 38 69 46 73 76 128 84 97 157 88 147 138 204 144 0 50 100 150 200 250 2011 2012 2013 2014 2015 2016 2017 Number of Over Occupancy Investigations by Outcome Total Unfounded Violation 2 per. Mov. Avg. (Violation) 2 per. Mov. Avg. (Total) Fort Collins Rental and Occupancy Study 2.3 Packet Pg. 165 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The percentage of unfounded investigations increased Among all investigations, the proportion of violations decreased from 55% in 2011 to 33% in 2017. 113 55% 56% 48% 50% 45% 37% 33% 45% 44% 52% 50% 55% 63% 67% 0% 25% 50% 75% 100% 2011 2012 2013 2014 2015 2016 2017 Percentage of Outcomes from Over Occupancy Investigations Unfounded Violation Fort Collins Rental and Occupancy Study 2.3 Packet Pg. 166 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 114 Section 2.3.2 Neighborhood Trends 2.3 Packet Pg. 167 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Neighborhood Summary Neighborhood Percentage of occupied homes that are rented Percentage of occupied homes that are multi-unit (more than one unit in structure) Away from Campus 35% 31% East of Campus 57% 39% West of Campus 70% 48% Fort Collins 46% 35% Fort Collins Rental and Occupancy Study 115 2.3 Packet Pg. 168 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The greatest number of violations were always west of campus The neighborhoods west, north, and south of campus (labeled as “West of campus” in this report) consistently had the highest number of violations per year since 2011, with total of 286 violations since 2011 and an average of 41 violations per year. The neighborhoods east of campus had a total 38 violations with an average of 5 per year, while the rest of the city had a total of 111 violations with an average of 16 per year. 116 17 22 12 14 17 19 10 3 12 3 4 5 6 5 26 54 27 56 40 51 32 0 10 20 30 40 50 60 70 80 2011 2012 2013 2014 2015 2016 2017 Violations by Study Area Away from Campus East of Campus West of Campus Fort Collins Rental and Occupancy Study 2.3 Packet Pg. 169 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The area west of campus has the highest violation per home ratio The area west of campus comprises about 23% of all occupied homes within Fort Collins, but this is where 66% of violations occurred from 2011 to 2017. Therefore, the ratio of violations per household was very high. The share of violations in the area east of campus was about the same as the share of homes. Violations in the remainder of the city were less common than the percentage of homes in this area. 117 66% 26% 11% 9% 23% 66% 0% 25% 50% 75% 100% Homes (2012-2016 avg.) Violations (2011 to 2017) Homes Compared to Violations West of Campus East of Campus Remained of City Fort Collins Rental and Occupancy Study 2.3 Packet Pg. 170 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Over time, violations became more likely west of campus The proportion of violations increased in the neighborhoods West of campus, from 57% of all violations in 2011 to 68% of all violations in 2017. 118 37% 25% 29% 19% 27% 25% 21% 7% 14% 7% 5% 8% 8% 11% 57% 61% 64% 76% 65% 67% 68% 0% 25% 50% 75% 100% 2011 2012 2013 2014 2015 2016 2017 Percentage of Violations by Study Area West of Campus East of Campus Away from Campus Fort Collins Rental and Occupancy Study 2.3 Packet Pg. 171 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The greatest number of unfounded cases were typically away from campus The greatest number of unfounded cases were in neighborhoods away from campus, where there were 229 unfounded cases since 2011 with an average of 33 unfounded cases per year. There were 214 unfounded cases west of campus with an average of 31 per year, and there were 83 unfounded cases east of campus, for an average of 12 per year. 119 18 27 20 28 33 50 53 7 18 88 15 11 16 13 24 18 36 28 67 28 0 10 20 30 40 50 60 70 80 2011 2012 2013 2014 2015 2016 2017 Unfounded Cases by Study Area Away from Campus East of Campus West of Campus Fort Collins Rental and Occupancy Study 2.3 Packet Pg. 172 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 120 Section 2.4 Occupancy Ordinance Violators Public Sentiment Towards Occupancy Ordinance 2.3 Packet Pg. 173 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Key Findings: Public Sentiment  The public is very aware of the ordinance (89%), and more likely to support the ordinance than oppose it (42% versus 24%).  However, 78% say that it has no impact on their neighborhood. Among those impacted by the ordinance, more residents said it had a positive impact (15%) than a negative impact (8%).  Two-thirds of residents either wanted no change in enforcement of the ordinance or didn’t know enough to have a preference. The remaining 35% were about evenly split, with 17% preferring enforcement more strict than now and 18% preferring enforcement less strict than now. A description of the methodology is found in the appendix. Fort Collins Rental and Occupancy Study 121 2.3 Packet Pg. 174 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Most residents were aware of the occupancy ordinance Most residents (89%) were aware of the ordinance There was little variation across different segments of the population, other than slightly more awareness among residents of single-family homes versus multi-family homes. Nonetheless, awareness is high even among multi-family home dwellers. Fort Collins Rental and Occupancy Study 122 Total Region Dwelling Type College Student in Home Opinion of Occupancy Ordinance West of campus East of campus Remainder of city Single family Multi- family Yes No Support Neutral Oppose No opinion Base Unweighted 1323 350 495 478 1029 294 205 1061 620 323 304 43 Weighted 1329 318 142 868 836 493 241 1030 539 394 311 45 Aware of Occupancy Ordinance Yes 89% 90% 88% 89% 91% 85% 91% 88% 93% 86% 88% 85% No 11% 10% 12% 11% 9% 15% 9% 12% 7% 14% 12% 15% 2.3 Packet Pg. 175 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Student homes and non-student homes oppose each other on the ordinance Overall, residents are more likely to support the ordinance than oppose it, though a significant number are neutral or undecided. Support outweighs opposition by a level of 42% versus 24%. The largest observed difference in support is homes containing college students versus those without. Homes with college students are more than twice as likely to oppose the ordinance than support it, but the opposite is true for homes without students. We also see that homeowners strongly support the ordinance while renters are evenly split between support and opposition. Fort Collins Rental and Occupancy Study 123 Total Region Dwelling Type Tenure College Student in Home Aware of Occupancy Ordinance West of campus East of campus Remainder of city Single family Multi- family Owner Renter Yes No Yes No Base Unweighted 1328 355 498 475 1044 284 1049 271 202 1064 1167 123 Opinion of Occupancy Ordinance Support 42% 38% 44% 43% 45% 37% 53% 30% 19% 47% 43% 28% Neutral 31% 34% 26% 31% 29% 34% 25% 38% 31% 31% 29% 40% Oppose 24% 26% 25% 23% 22% 27% 19% 29% 44% 19% 24% 27% No opinion 3% 3% 4% 3% 4% 3% 3% 4% 7% 2% 3% 5% 2.3 Packet Pg. 176 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The ordinance does not impact most residents Only 23% of residents say that the ordinance impacts their neighborhood. Among these, positive impacts outweigh negative impacts by a margin to 15% to 8%. Every segment saw more positives than negatives, other than homes with college students. The most common reasons cited for positive impacts were simply that the ordinance is effective in its goal, that the ordinance enhances peace and quiet, and that the ordinance leads to fewer cars nearby. The most common reasons cited for negative impacts were affordability and general comments about obtaining housing. Fort Collins Rental and Occupancy Study 124 Total Region Tenure College Student in Home West of campus East of campus Remainder of city Owner Renter Yes No Base Unweighted 1283 342 477 464 1018 257 196 1029 Weighted 1266 301 128 837 700 560 226 983 Positive impact 15% 23% 17% 11% 15% 14% 11% 15% No significant impact 78% 61% 76% 84% 79% 77% 72% 79% Negative impact 8% 16% 7% 5% 7% 9% 17% 6% 2.3 Packet Pg. 177 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Support for ordinance changes is split Two-thirds of residents either wanted no change in enforcement or didn’t know enough to have a preference. The other 35% was evenly split on preferring more or less enforcement. Residents in homes with college students preferred less strict enforcement. Fort Collins Rental and Occupancy Study 125 Total Region College Student in Home Opinion of Occupancy Ordinance West of campus East of campus Remainder of city Yes No Support Neutral Oppose No opinion Base Unweighted 1319 354 491 474 200 1058 640 327 306 42 Weighted 1314 316 139 859 236 1021 554 405 311 41 More strictly than now 17% 20% 18% 15% 8% 19% 33% 4% 5% 5% Same as now 38% 40% 33% 37% 31% 38% 49% 46% 9% 19% Less strictly than now 18% 20% 27% 16% 34% 14% 0% 9% 63% 6% Don’t know 28% 21% 21% 32% 27% 29% 18% 41% 23% 70% 2.3 Packet Pg. 178 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Section 3 - Short Term Rentals 126 2.3 Packet Pg. 179 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 127 Section 3.1 Short-Term Rentals Profile of Units and Revenues 2.3 Packet Pg. 180 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Key Findings: Profile of Units and Revenue  The number of STRs increased strongly between 2015 and 2017. The number is still growing, though the growth rate has slowed into 2018.  A majority of STRs are full-time rentals. They are increasingly entire homes, as opposed to rooms in primary residences.  Revenues from STRs are growing rapidly, with nearly $10 million in citywide revenues estimated for 2018. A description of the methodology is found in the appendix. Fort Collins Rental and Occupancy Study 128 2.3 Packet Pg. 181 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The supply of short-term rentals (STRs) has increased quickly The accompanying table shows the number of properties listed each month from late 2014 through mid-2018. The number of properties roughly doubled each year until 2018, when it rose roughly 10% (through the latest available data). Fort Collins Rental and Occupancy Study 129 Month Year 1 2 3 4 5 6 7 8 9 10 11 12 2014 86 88 100 2015 109 99 103 117 140 148 176 176 185 192 213 241 2016 256 266 277 282 329 343 364 376 414 434 445 465 2017 477 473 501 491 533 524 549 541 525 527 541 562 2018 556 528 524 514 2.3 Packet Pg. 182 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) STRs are vacant more often than not We can calculate an occupancy rate by dividing the number of occupied nights by the number of nights that the property was available for rent. On average, occupancy rates are 32% on any given night, but with strong seasonal changes. Occupancy rates in the summer are higher than occupancy in other seasons, and particularly in the month of July. Note that not all STRs are available for rent full time. Some are available less often, depending on the host’s preferences. So the units are occupied less than the formal occupancy rate will show. However, as seen later in this chapter, most STRs are available full-time or a strong majority of the time. Fort Collins Rental and Occupancy Study 130 Occupancy Rate Month 123456789101112 Total 2014 27% 25% 20% 24% 2015 21% 17% 22% 24% 34% 38% 50% 41% 26% 27% 22% 21% 28% 2016 20% 18% 23% 25% 34% 43% 49% 43% 31% 32% 25% 26% 31% 2017 20% 20% 25% 26% 35% 46% 57% 52% 38% 37% 29% 30% 35% 2018 23% 24% 30% 32% 27% Total 21% 21% 26% 28% 34% 44% 53% 48% 33% 33% 26% 26% 32% 2.3 Packet Pg. 183 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Most STRs are available as full-time rentals Over half of STRs are for rent every day, while most of the remainder are available more than half of the days in any given month. As the market has matured, the number of casual rentals (less than half time) has settled into the 10% to 14% range. Among those that are available more than half the time, most are available for nearly every day of the month, being pulled off the market only occasionally. Fort Collins Rental and Occupancy Study 131 Availability 12345678910 11 12 2014 Full 58% 64% 61% Less Than Half 9% 13% 11% More Than Half 33% 24% 28% 2015 Full 62% 58% 53% 46% 38% 33% 23% 28% 28% 28% 44% 43% Less Than Half 11% 13% 15% 17% 21% 22% 30% 33% 22% 18% 13% 15% More Than Half 27% 29% 32% 37% 41% 45% 47% 39% 51% 55% 44% 42% 2016 Full 55% 60% 53% 60% 48% 44% 42% 41% 52% 53% 57% 58% Less Than Half 16% 14% 14% 12% 13% 14% 13% 14% 10% 12% 12% 14% More Than Half 30% 26% 32% 28% 39% 42% 46% 45% 37% 34% 31% 29% 2017 Full 62% 65% 54% 60% 48% 48% 47% 46% 51% 51% 55% 60% Less Than Half 12% 13% 9% 8% 12% 15% 14% 14% 12% 11% 14% 14% More Than Half 26% 22% 37% 32% 40% 37% 39% 40% 37% 37% 32% 27% 2018 Full 60% 63% 61% 60% Less Than Half 14% 13% 13% 8% More Than Half 26% 24% 26% 32% 2.3 Packet Pg. 184 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) STR units are dispersed across the city Roughly half of STRs were located near campus in the past, but rentals are dispersing over time. Rentals outside the two campus neighborhoods have risen from roughly 50% to over 60% as the market has grown. Fort Collins Rental and Occupancy Study 132 East of Campus Month 1 2 3 4 5 6 7 8 9 10 11 12 2014 22% 23% 27% 2015 24% 23% 24% 27% 26% 25% 24% 22% 23% 23% 22% 22% 2016 21% 19% 21% 21% 20% 20% 18% 20% 23% 23% 23% 22% 2017 22% 22% 21% 21% 21% 21% 20% 22% 22% 22% 21% 21% 2018 21% 21% 21% 22% West of Campus 1 2 3 4 5 6 7 8 9 10 11 12 2014 24% 27% 26% 2015 24% 24% 21% 21% 21% 22% 21% 23% 20% 20% 23% 23% 2016 25% 24% 21% 24% 26% 24% 24% 22% 20% 20% 20% 22% 2017 21% 21% 21% 20% 21% 19% 19% 16% 16% 16% 16% 16% 2018 17% 17% 17% 16% Remainder of City 1 2 3 4 5 6 7 8 9 10 11 12 2014 53% 50% 47% 2015 52% 53% 54% 52% 53% 53% 55% 55% 57% 57% 55% 55% 2016 53% 57% 58% 55% 54% 56% 57% 58% 57% 57% 57% 56% 2017 57% 58% 58% 58% 58% 60% 61% 62% 62% 63% 63% 63% 2018 62% 62% 62% 62% 2.3 Packet Pg. 185 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The types of STR units are evolving Private rooms in homes have historically been the bulk of rentals, but this is changing over time as renting entire units is becoming more common. Renting entire housing units, generally more of an investment approach than renting rooms, has risen from 34% of units to 46% of units. Fort Collins Rental and Occupancy Study 133 Entire home/apt Private room Shared room 2014 34% 57% 9% 2015 37% 56% 6% 2016 41% 54% 4% 2017 44% 52% 5% 2018 46% 50% 4% 2.3 Packet Pg. 186 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Prices are rising over time Length of stay is relatively consistent over time, but price per night is rising (likely due in part to full units becoming more common as STRs). Fort Collins Rental and Occupancy Study 134 Average Nights Per Reservation Month 1 2 3 4 5 6 7 8 9 10 11 12 Total 2014 4.3 7.0 6.0 5.5 2015 7.5 3.6 3.8 3.8 3.0 3.0 3.4 3.0 2.8 3.1 3.8 3.4 3.3 2016 3.9 3.5 3.5 3.0 3.2 3.3 3.4 3.2 3.0 3.0 3.5 3.6 3.3 2017 3.6 3.3 3.4 3.2 3.2 3.2 3.7 3.1 3.1 3.0 3.2 3.8 3.3 2018 3.7 3.5 3.3 3.2 Average Dollars Per Night Reserved Month 1 2 3 4 5 6 7 8 9 10 11 12 Total 2014 $82 $89 $81 $84 2015 $90 $94 $86 $86 $88 $91 $89 $87 $92 $89 $86 $100 $90 2016 $88 $86 $84 $90 $99 $103 $106 $101 $99 $102 $99 $102 $99 2017 $92 $96 $104 $105 $119 $120 $120 $118 $123 $123 $130 $124 $117 2018 $108 $107 $112 $114 2.3 Packet Pg. 187 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Total revenues are growing rapidly Revenues are growing on both a per-property basis and on a citywide basis. Over the past three years, monthly revenues per unit have roughly doubled, and citywide revenues have risen from less than $1 million to an estimated $9.6 million in 2018. Fort Collins Rental and Occupancy Study 135 Revenue Per Property Month Citywide Revenues 1 2 3 4 5 6 7 8 9 10 11 12 Measured TTotal Estimated AAnnnual Total 2014 $599 $566 $429 $144,297 $489,519 2015 $498 $376 $486 $495 $692 $764 $923 $752 $528 $571 $466 $524 $1,137,225 $1,137,225 2016 $452 $391 $499 $579 $880 $1,120 $1,319 $1,087 $783 $884 $641 $691 $3,398,016 $3,398,016 2017 $479 $461 $696 $718 $1,088 $1,357 $1,748 $1,581 $1,187 $1,201 $960 $990 $6,586,274 $6,586,274 2018 $673 $625 $884 $981 $1,671,493 $9,591,305 2.3 Packet Pg. 188 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 136 Section 3.2 Short-Term Rentals Rental Hosts and Properties 2.3 Packet Pg. 189 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Key Findings: Rental Hosts and Properties  The STR market in Fort Collins is run by individuals and appears to be significantly insulated from large property management companies. > 85% of hosts only own and operate a single STR. > Only 5% of hosts said they owned their STRs with anyone other than their spouse. > 62% of STRs in Fort Collins are also hosts’ primary residence. > Only 4% of STR units were managed by professional firms.  Hosts mention income, culture, and the unique benefits or appeal of STRs as motivations for buying property for this purpose.  Around 30% of STRs have been pulled from the long-term rental market. A description of the methodology is found in the appendix. Fort Collins Rental and Occupancy Study 137 2.3 Packet Pg. 190 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The majority of city-licensed hosts operate only one STR Fort Collins Rental and Occupancy Study 138 Only Operates 1 STR 85% Operates 2 STRs 8% Operates 3 or More STRs 7% Few hosts in Fort Collins How Many Short-Term Rentals do you Operate? operate more than one STR. Overall, the STR market in Fort Collins appears to be insulated from large property management companies. Only 5% of respondents said they owned their property with someone other than their spouse. Only one respondent noted that they operated five STRs, the highest value in the survey. 2.3 Packet Pg. 191 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) City-licensed STRs in Fort Collins are distributed evenly across unit type Fort Collins Rental and Occupancy Study 139 Entire house 27% Entire condo/apartment/ townhouse 26% Bedroom(s) in a house 30% Bedroom(s) in a condo/apartment/ townhouse 2% Other 15% Type of Short-Term Rentals Hosts report renting bedrooms, entire houses, and entire apartments at similar rates. The most frequent responses within the “Other” category were “Carriage House” and “Private Suite, Basement, or Garage.” 2.3 Packet Pg. 192 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Few city-licensed STR hosts have plans to own new properties Fort Collins Rental and Occupancy Study 140 Host Activity Please check each statement that applies to you. I currently own long-term rentals in Fort Collins 38% I currently own a second, unrented home for personal use 8% I plan on purchasing more properties to use as short-term rentals in Fort Collins in the next two years 10% I plan on purchasing more properties to use as long-term rentals in Fort Collins in the next two years 13% I plan on selling properties I own that are currently short-term rentals in Fort Collins in the next two years 4% I plan on selling properties I own that are currently long-term rentals in Fort Collins in the next two years 5% I currently own long-term rental(s) in Fort Collins and plan on making some or all of them short-term rental(s) in the next two years 4% I currently own long-term rental(s) in Fort Collins and plan on selling some or all of the property(ies) in the next two years 3% While a significant percentage of STR hosts also report owning long-term rentals in Fort Collins (38%), few plan on purchasing new properties for the purpose short-term (10%) or long- term (13%) renting in the next two years. Very few (4%) hosts plan on making long-term rentals into STRs in the near future. 2.3 Packet Pg. 193 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The average city-licensed STR in Fort Collins rents for $125 a night Fort Collins Rental and Occupancy Study 141 Hosts reported charging an average of $125 per night for their STRs. A majority of bedroom(s) within a house were rented for less than $65 a night, while a majority of entire houses were rented for more than $150 a night. The median nightly rent was $100, indicating the presence of a few very expensive STRs. The most expensive reported average nightly rent was $450 for an entire house. Host Reported Nightly Cost by Most Common Unit Types Average rent per night Less than $65 $65 - $100 $101 - $150 More than $150 Entire house - 7% 30% 63% Entire condo/apartment/townhouse 6% 42% 33% 19% Bedroom(s) in a house 65% 24% 6% 6% 2.3 Packet Pg. 194 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Most city-licensed STRs are hosts’ primary residence Fort Collins Rental and Occupancy Study 142 STR is also my primary residence 62% STR is not my primary residence 38% Residency Status of STRs The majority of STRs described in the survey were also hosts’ primary residence. This pattern is consistent with previous findings that suggest the STR market in Fort Collins is managed more by individuals than property companies. Hosts reported only 4% of STRs in the survey as being managed by professional firms. A significant proportion of STRs that are not primary residences belong to the few hosts who happen to operate multiple STRs. 2.3 Packet Pg. 195 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) A majority of city-licensed STRs were previously primary residences Fort Collins Rental and Occupancy Study 143 Long-term rental 24% Primary residence 57% Second residence 0% Other 13% Unsure/don’t know 6% Previous use Before Ownership Long-term rental 20% Primary residence 55% Second residence 1% Other 18% Unsure/don’t know 6% Previous use While Owned When asked to recall the previous use of their STRs before and during ownership, a majority of hosts said these units used to be primary residences. Hosts recall 24% and 20% of STRs previously being long-term rental units (with lease agreements 1 month or longer) before and during ownership, respectively. The most common descriptions of the “Other” category reference new construction or remodeling. 2.3 Packet Pg. 196 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) City-licensed Hosts mention income, culture, and the unique benefits or appeal of STRs as motivations for renting Fort Collins Rental and Occupancy Study 144 14% 26% 40% 62% 0% 20% 40% 60% 80% Culture Competing with LTRs Unique STR appeal Income Percentage of Responses that Mentioned Each of the Following when asked, "What led to your decision to purchase this property with the intent of it being short-term rental?" The majority of hosts mentioned income when asked about their decision to purchase a STR property. 40% of hosts indicated that they would not have a rental property if it were not short-term, primarily due to scheduling flexibility and alternative uses of the property. 26% of hosts noted that they prefer STR renting to long-term renting due to the quality of tenants, higher income, and other benefits. Finally, 14% of hosts highlighted the cultural experience of short-term renting. Example quotes can be found below. Income: “For extra income so I can pay my mortgage and HOA fees.” Unique STR appeal: “The amount of time I spend away from home for both work and personal travel, might as well let someone else use the space while it sits there empty.” Competing with LTRs: “Too much wear and tear on the property from long term tenants.” Culture: “There is something really special and unique about staying in a home where you can share a cup of coffee with your host, share stories, and learn about the town you're visiting.” 2.3 Packet Pg. 197 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 145 Estimation Strategies to Calculate Percentage of STRs that Came from the LTR Market Units Bedrooms Switched STRs Total STRs Percent Switched Rooms Total Rooms Percent Q7: Previous Use While Owned was LTR 26 123 21% 57 236 24% Q8: Original Intent at Purchase was LTR 20 122 16% 45 236 19% Q10: Decision Process Considered LTR 23 122 19% 50 232 22% Q12: Recall Previous Owner LTR 31 122 25% 71 235 30% Average 25 122 20% 56 235 24% Any Switch Indicator 52 122 43% 107 236 45% Q7, Q8, or Q10 36 122 30% 80 236 34% The table above details a series of strategies to estimate the percentage of STRs that came from the LTR market. The number of bedrooms switched is calculated by multiplying the various switch data by the number of bedrooms hosts reported for each switched STR unit. The most conservative estimate is the average of all potential switch indicators (20% of STRs). Relying on hosts to report only their own past actions (questions 7, 8, and 10), and not their recollection of previous owners (question 10), provides a higher estimate of 30% of STR units that were converted from long-term rentals. Approximately 30% of city-licensed STRs were once long- term rentals 2.3 Packet Pg. 198 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 146 Section 3.3 Short-Term Rentals Public Sentiment Toward Short-Term Rental Rules 2.3 Packet Pg. 199 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Key Findings: Public Sentiment  About one-third of residents are aware of STR licensing rules.  Support for STR rules outweighs opposition by a margin of 38% to 20% (with the remainder being neutral). A description of the methodology is found in the appendix. Fort Collins Rental and Occupancy Study 147 2.3 Packet Pg. 200 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Most residents are not aware of STR licensing rules About one-third of residents were aware of STR licensing rules. The highest awareness was seen east of campus, while the lowest awareness was in areas where only primary STRs are allowed. Fort Collins Rental and Occupancy Study 148 Total Region STR Zone West of campus East of campus Remainder of city No STRs allowed Primary STRs only Primary and non-primary STRs allowed Base Unweighted 1366 361 513 492 851 468 47 Weighted 1362 323 145 894 640 622 101 Missing No reply 5% 5% 4% 5% 2% 7% 7% Aware of STR Licensing Yes 31% 29% 39% 31% 34% 27% 37% No 64% 67% 57% 65% 64% 66% 56% 2.3 Packet Pg. 201 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The public generally supports STR rules While a large proportion of residents were not aware of STR rules, those people still generally supported such rules when informed about them. Nonetheless roughly 20% still opposed them. Support for the rules was higher among residents who were already aware of the rules. Residents with higher incomes were slightly more likely to support rules than those with lower incomes. Fort Collins Rental and Occupancy Study 149 Total Region Aware of STR Licensing Impact of STRs on Neighborhood Household Income West of campus East of campus Remainder of city Yes No Positive impact No significant impact Negative impact Not applicable Less than $50,000 $50,000 or more Decline to specify Base Unweighted 1344 354 506 484 487 817 31 673 144 438 287 777 215 Weighted 1337 316 144 877 422 863 23 647 170 439 401 661 213 Opinion of STR Rules Support 41% 38% 41% 42% 50% 37% 31% 38% 61% 38% 35% 44% 43% Neutral or no opinion 39% 42% 41% 38% 34% 42% 39% 43% 23% 42% 44% 36% 40% Oppose 19% 20% 18% 20% 16% 21% 31% 19% 16% 20% 21% 20% 17% 2.3 Packet Pg. 202 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Section 4 - Neighborhood Quality 150 2.3 Packet Pg. 203 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 151 Section 4.1 Neighborhood Quality Citywide 2.3 Packet Pg. 204 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Key Findings: Citywide Neighborhood Quality  Residents give generally high ratings to neighborhood quality, though ratings have decline over the past 15 years.  Parking vehicles inappropriately and loud noises (other than parties) were most common neighborhood issues citywide. A description of the methodology is found in the appendix. Fort Collins Rental and Occupancy Study 152 2.3 Packet Pg. 205 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Neighborhood quality was generally high On a citywide basis, residents had positive perceptions of their neighborhood, particularly in terms of peace and quiet, and maintenance of lawns and homes. Sense of community had lower scores, but still positive. However, opinions were not uniform. The neighborhoods west of the campus rated all of these attributes considerably lower than did the other areas of the city, though all attributes were still rated positively. Additionally, homeowners tended to rate all elements higher than renters, particularly sense of community. Interestingly, residents who opposed ordinance generally gave higher neighborhood ratings than those who supported the ordinance. Fort Collins Rental and Occupancy Study 153 Total Region Tenure College Student in Home Opinion of Occupancy Ordinance West of campus East of campus Remainder of city Owner Renter Yes No Support Neutral Oppose No opinion Peace and quiet 1.12 0.80 1.14 1.24 1.27 0.94 1.17 1.11 1.06 1.11 1.21 1.40 Maintenance of lawns 1.05 0.77 0.87 1.18 1.10 0.99 1.13 1.04 0.99 1.01 1.25 1.19 Maintenance of houses 1.07 0.78 0.90 1.20 1.20 0.90 0.89 1.10 1.04 1.04 1.12 1.28 Sense of community 0.48 0.25 0.56 0.55 0.76 0.13 0.21 0.54 0.54 0.39 0.52 0.69 Very good = 2, Fair = 0, Very bad = -2, Not applicable = excluded 2.3 Packet Pg. 206 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Some neighborhood problems have increased over the last decade Fort Collins Rental and Occupancy Study 154 * “Uncontrolled pets running loose” was the question text from 2018 while “Animals running loose” was the wording in 2008 and 2004. 41% 16% 20% 24% 30% 34% 25% 21% 35% 13% 13% 18% 16% 28% 22% 20% 34% 14% 21% 29% 16% 39% 30% 28% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Uncontrolled pets running loose* Criminal activity Disruptive parties Loud noise other than parties, such as stereos or yelling More than three unrelated people living in a house Parking vehicles inappropriately Trash or junk in the yard Poorly maintained house Percentage of Single Family Homes that Observed Neighborhood Problems 2004 2008 2018 While neighborhood problems decreased between 2004 and 2008, a higher percentage of residents in 2018 reported observing at least one of their four nearest residences having disruptive parties, loud noise, parking vehicles inappropriately, trash or junk in the yard, and While neighborhood ratings are high, the percentage of residents rating their neighborhood good or very good has reverted to, or dropped below, pre-ordinance levels Fort Collins Rental and Occupancy Study 155 84% 81% 87% 58% 89% 85% 90% 68% 85% 75% 82% 54% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Peace and quiet Maintenance of lawns Maintenance of houses Sense of community Percentage of Single Family Homes that Rated Their Neighborhood Good or Very Good 2004 2008 2018 While the 2008 survey saw universal increases in neighborhood ratings compared to 2004, the change between 2008 and 2018 saw the percentage of residents rating their neighborhood good or very good decrease across the board. Nonetheless, substantial majorities rate their neighborhood as good or very good on these measures. 2.3 Packet Pg. 208 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Inappropriately parked vehicles are the most common neighborhood issue Parking vehicles inappropriately and loud noises (other than parties) were most common issues, particularly in the neighborhoods west of campus. This area was more likely to see every one of the tested issues. Similarly, renters were more likely to see every tested issue in comparison to owners. Fort Collins Rental and Occupancy Study 156 Total Region Tenure Opinion of Occupancy Ordinance West of campus East of campus Remainder of city Owner Renter Support Neutral Oppose Uncontrolled pets running loose 0.51 0.69 0.47 0.45 0.43 0.6 0.58 0.53 0.39 Criminal activity 0.33 0.62 0.34 0.23 0.16 0.54 0.35 0.31 0.27 Disruptive parties 0.36 0.74 0.3 0.24 0.24 0.5 0.35 0.45 0.3 Loud noise other than parties, such as stereos or yelling 0.59 1.12 0.55 0.4 0.37 0.86 0.56 0.66 0.59 Parking vehicles inappropriately 0.66 1.03 0.64 0.53 0.59 0.74 0.71 0.66 0.59 Snow on sidewalks (snow not shoveled) 0.54 0.83 0.66 0.43 0.58 0.49 0.59 0.6 0.36 Trash or junk in the yard 0.49 0.91 0.51 0.34 0.39 0.62 0.59 0.46 0.39 Poorly maintained house 0.36 0.6 0.54 0.25 0.34 0.39 0.41 0.36 0.28 Averages exclude “not applicable” responses 2.3 Packet Pg. 209 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 157 Section 4.2 Neighborhood Quality Proximity to Ordinance Violators 2.3 Packet Pg. 210 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Key Findings: Proximity to Ordinance Violators  Lower neighborhood quality and more negative neighborhood issues are strongly correlated with being neighbors to a suspected ordinance-violating household.  However, the overall negative trend is neighborhood quality and long-term increases in negative neighborhood issues are also seen when no ordinance-violating neighbors are present. A description of the methodology is found in the appendix. Fort Collins Rental and Occupancy Study 158 2.3 Packet Pg. 211 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Neighborhood impacts were linked to perceptions of a violating neighbor Total West of campus- Neighbor(s) violating occupancy ordinance East of campus- Neighbor(s) violating occupancy ordinance Remainder of city- Neighbor(s) violating occupancy ordinance Yes No Yes No Yes No Peace and quiet 1.13 0.52 0.92 0.78 1.24 0.85 1.3 Maintenance of lawns 1.08 0.51 0.97 0.57 0.93 0.72 1.28 Maintenance of houses 1.08 0.5 0.96 0.83 0.95 0.49 1.31 Sense of community 0.49 -0.11 0.44 0.45 0.58 0.03 0.65 Fort Collins Rental and Occupancy Study 159 Very good = 2, Fair = 0, Very bad = -2, Not applicable = excluded Residents who reported having at least one violating neighbor were much more likely to report lower neighborhood quality, especially for maintenance of houses in the remainder of the city. 2.3 Packet Pg. 212 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Within neighborhoods, proximity to violator households led to differences in neighborhood issues 160 Total West of campus- Neighbor(s) violating occupancy ordinance East of campus- Neighbor(s) violating occupancy ordinance Remainder of city- Neighbor(s) violating occupancy ordinance Yes No Yes No Yes No Uncontrolled pets running loose 0.51 1.02 0.54 0.66 0.42 0.77 0.4 Criminal activity 0.31 1.07 0.45 0.93 0.23 0.54 0.14 Disruptive parties 0.36 1.42 0.44 0.7 0.19 0.6 0.18 Loud noise other than parties, such as stereos or yelling 0.59 1.75 0.84 1.49 0.39 0.76 0.35 Parking vehicles inappropriately 0.63 1.78 0.67 1.47 0.49 0.86 0.44 Snow on sidewalks (snow not shoveled) 0.53 1.55 0.47 1.35 0.5 0.87 0.35 Trash or junk in the yard 0.48 1.53 0.58 1.53 0.32 0.91 0.25 Poorly maintained house 0.35 1.07 0.33 1.19 0.42 0.89 0.15 Fort Collins Rental and Occupancy Study Residents reporting at least one violating neighbor were much more likely to report a higher number of neighbor issues, especially for trash or junk in the yard in the East region and parking vehicles in the West region. 2.3 Packet Pg. 213 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) 39% 39% 30% 39% 56% 39% 27% 51% 29% 44% 39% 66% 61% 56% 33% 19% 37% 43% 61% 49% 58% 0% 20% 40% 60% 80% 100% Single Family Homes that Observed Neighborhood Problems: One Observed Violator The presence of violators in 2018 increased reported neighborhood problems, but often at a lower rate than 2008 Fort Collins Rental and Occupancy Study 161 * “Uncontrolled pets running loose” was the question text from 2018 while “Animals running loose” was the wording in 2008 and 2004. 53% 31% 72% 56% 72% 61% 58% 52% 48% 57% 71% 90% 67% 76% 59% 43% 63% 66% 81% 79% 68% 0% 10% 20% 30% 40% 50% 60% 70% Decreases in neighborhood ratings were observed in the absence of violator households Fort Collins Rental and Occupancy Study 162 91% 91% 94% 64% 92% 90% 94% 72% 88% 81% 88% 58% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Peace and quiet Maintenance of lawns Maintenance of houses Sense of community Single Family Homes that Rated Their Neighborhood Good or Very Good with no Observed Violators 2004 2008 2018 While residents who observed no violators in their four neighboring households rated their neighborhood good or very good at higher rates than those who did, they did so at a lower rate than they have in the past. This suggests something beyond, or in addition to, ordinance violators is causing the observed decrease in neighborhood quality. 2.3 Packet Pg. 215 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Increases in neighborhood problems were observed in the absence of violator households Fort Collins Rental and Occupancy Study 163 * “Uncontrolled pets running loose” was the question text from 2018 while “Animals running loose” was the wording in 2008 and 2004. 40% 13% 10% 16% 22% 16% 14% 32% 9% 7% 12% 19% 14% 12% 33% 11% 15% 24% 32% 24% 21% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Uncontrolled pets running loose* Criminal activity Disruptive parties Loud noise other than parties, such as stereos or yelling Parking vehicles inappropriately Trash or junk in the yard Poorly maintained house Single Family Homes that Observed Neighborhood Problems: No Observed Violators 2004 2008 2018 The above graph plots the percentage of neighborhood issues reported by residents who said none of their four nearest homes had more than three unrelated people living in them. While the number of problems reported by this group is significantly lower than those who observe neighbors violating the ordinance, this group was more likely to report problems in 2018 than they were in 2008. 2.3 Packet Pg. 216 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The presence of violating households decreases the percentage of good or very good neighborhood ratings Fort Collins Rental and Occupancy Study 164 72% 62% 78% 46% 83% 68% 74% 54% 67% 54% 62% 46% 0% 20% 40% 60% 80% 100% Peace and quiet Maintenance of lawns Maintenance of houses Sense of community One Observed Violator 2004 2008 2018 64% 56% 55% 39% 48% 38% 58% 48% 68% 31% 45% 21% 0% 20% 40% 60% 80% 100% Peace and quiet Maintenance of lawns Maintenance of houses Sense of community Two or More Observed Violators 2004 2008 2018 Living next to violators decreases good and very good neighborhood ratings across all surveys and indicators. As with residents who observed zero violating households, these percentages decreased in between 2008 and 2018 for those who reported one or multiple violating neighbor. Single Family Homes that Rated Their Neighborhood Good or Very Good 2.3 Packet Pg. 217 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 165 Section 4.3 Neighborhood Quality Proximity to Short-Term Rentals 2.3 Packet Pg. 218 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Key Findings: Proximity to Short-Term Rentals  Lower neighborhood quality and more negative neighborhood issues are also correlated with being neighbors to an STR property.  However, the impact is smaller than proximity to a suspected ordinance-violating property, and the negative impacts are notably smaller in areas where STRs are allowed, compared to areas where they are not allowed. A description of the methodology is found in the appendix. Fort Collins Rental and Occupancy Study 166 2.3 Packet Pg. 219 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) STR presence correlates with lower neighborhood quality  Residents report somewhat lower neighborhood quality when they live near an STR, with the largest impact being on sense of community.  While the sample sizes are too small to draw confident conclusions, it appears that the negative impact is primarily when STRs operate in areas where they’re not allowed. An STR operating in a zone where STRs are allowed did not appear to impact quality of life (with results even leaning very slightly positive). Fort Collins Rental and Occupancy Study 167 Total Neighbor(s) operate STRs No STRs allowed- Neighbor(s) operate STRs Primary STRs only- Neighbor(s) operate STRs Yes No Yes No Yes No Peace and quiet 1.13 1.07 1.14 1.1 1.27 1.17 1.08 Maintenance of lawns 1.07 0.91 1.09 0.71 1.14 1.15 1.09 Maintenance of houses 1.07 0.93 1.09 0.90 1.18 0.96 0.98 Sense of community 0.5 0.36 0.52 0.37 0.68 0.40 0.38 Small sample sizes Very good = 2, Fair = 0, Very bad = -2, Not applicable = excluded 2.3 Packet Pg. 220 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Neighborhood issues are correlated with STR presence Residents report more neighborhood issues when neighbor(s) operate(s) an STR. The impact is larger when STRs are operating in areas where they are not allowed, particularly having snow on sidewalks, parking, and loud noises. Fort Collins Rental and Occupancy Study 168 Total Neighbor(s) operate STRs No STRs allowed- Neighbor(s) operate STRs Primary STRs only- Neighbor(s) operate STRs Yes No Yes No Yes No Uncontrolled pets running loose 0.51 0.82 0.47 0.85 0.47 0.78 0.46 Criminal activity 0.3 0.56 0.26 0.52 0.15 0.68 0.35 Disruptive parties 0.35 0.56 0.33 0.63 0.24 0.55 0.37 Loud noise other than parties, such as stereos or yelling 0.57 0.84 0.54 0.88 0.39 0.91 0.63 Parking vehicles inappropriately 0.63 0.87 0.60 1.03 0.52 0.8 0.66 Snow on sidewalks (snow not shoveled) 0.53 0.77 0.50 1.08 0.51 0.5 0.54 Trash or junk in the yard 0.47 0.67 0.44 0.76 0.38 0.65 0.45 Poorly maintained house 0.35 0.64 0.32 0.71 0.33 0.63 0.32 Averages exclude “not applicable” responses 2.3 Packet Pg. 221 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) The impact of STRs is narrow STRs impact the neighborhood of about 15% of residents, showing that they are not yet widespread and/or that their impact is narrow within a neighborhood. Of impacted residents, more cited a negative impact than a positive impact (13% versus 2%). The impact goes up if they have a neighbor operating an STR, as does the support of STR rules. The most commonly cited reasons for negative impacts were strangers coming and going, trash/lack of maintenance, parking, and partying/noise. Fort Collins Rental and Occupancy Study 169 Total Neighbor(s) Operate STRs STR Zone Aware of STR Licensing Opinion of STR Rules Yes No No STRs allowed Primary STRs only Primary and non-primary STRs allowed Yes No Support Neutral Oppose No opinion Base Unweighted 1366 147 1152 851 468 47 491 825 558 388 274 124 Weighted 1362 145 1134 640 622 101 423 877 547 391 260 138 Missing No reply 7% 3% 3% 5% 7% 15% 4% 3% 5% 5% 6% 4% Positive impact 2% 1% 2% 2% 1% 3% 2% 2% 1% 0% 3% 6% No significant impact 47% 61% 49% 45% 50% 50% 57% 45% 45% 56% 47% 42% Negative impact 13% 31% 10% 12% 14% 8% 14% 13% 19% 9% 10% 2% Not applicable 33% 4% 38% 37% 29% 25% 24% 38% 30% 31% 34% 46% 2.3 Packet Pg. 222 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Appendix - Methodology 2.3 Packet Pg. 223 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 171 Methodology Rental Market Trends • Comparisons to Other Colorado Metro Areas • Comparison to a Selection of Nationwide Cities 2.3 Packet Pg. 224 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Methodology: Rental Market Trends Comparisons to Other Colorado Metro Areas In order to assess changes to the overall rental market in Fort Collins, Corona Insights employed data from current and archived reports from the Colorado Department of Housing. These data allow for an analysis of trends in vacancy and rental rates by unit type and offer the chance to make two important comparisons. First, we replicate analysis from our 2009 report and include trends from similar Colorado cities including, Colorado Springs, Greeley, Grand Junction, and Pueblo. By observing these similar metro areas we can start to distinguish what separates Fort Collins’ rental market from broader trends in the state. Second, these data often allow for comparisons overtime spanning multiple decades. Comparing trends pre and post-ordinance provides insights into the law’s potential effect. It is important to note that the Colorado Division of Housing only collects data on multifamily homes. While this accounts for a majority of the rental market in Fort Collins, these data were supplemented with data from the US Census’ American Community Survey to account for the entire scope of the market. Population data was collected from the State Demographer and the US Census. Finally, Corona Insights collected supplemental data from Redfin and the Census’ Building Permits Survey in order to assess the broader housing market in Fort Collins. While the Colorado Division of Housing often reports data for the combined Fort Collins/Loveland market, these cities are reported independently when possible. Cities and years are included/excluded in analysis based on data availability. Fort Collins Rental and Occupancy Study 172 2.3 Packet Pg. 225 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Methodology: Rental Market Trends Comparisons to a Selection of Nationwide Cities The Comparisons to Other Colorado Metro Areas section of this report identified how the Fort Collins rental market has compared to similar metro areas within the state of Colorado. While that analysis allowed for the ability to account for broader trends within the state, it could not rule out the possibility that the patterns observed in Fort Collins were common to similar cities across the country. Specifically, Fort Collins’ household growth and composition have historically been filled by younger individuals (aged 15-24) at higher rates than other cities in the state. As such, a comparison of similar cities nationwide is needed to supplement the assessment of the previous section. This section replicates analysis conducted in Corona Insights’ 2005 report to compare trends in the rental markets across 15 similar case study cities. This national analysis allows for an additional assessment of how the Fort Collins housing market has fared in the pre and post-ordinance era. Data in this section comes from the US Census’ American Community Survey. Two main time periods will be compared. The first is the era between 1990 and 2000. This provides a baseline for how the Fort Collins rental market compared to similar cities. The second era is between 2005 and 2017. Here, comparisons demonstrate what trends emerge post- ordinance. Data have been annualized to account for the difference in each era’s length. Fort Collins Rental and Occupancy Study 173 2.3 Packet Pg. 226 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Methodology: Rental Market Trends Case Selection for National Market Analysis  This section details the case selection process for the national market analysis.  As of the Year 2000, there were 243 cities in the United States and its protectorates with population of 100,000 or more, which made up the initial population of eligible comparable cities. From that initial list, Corona pared down the candidates as follows: > Corona eliminated from consideration 41 cities that had population over 400,000. > Corona eliminated two cities that radically changed their boundaries between 1990 and 2000, and thus acquired large pre-existing populations and housing stocks. > Corona eliminated 34 cities that experienced declines in population from 1990 through 2000. > Corona eliminated 7 cities that experienced phenomenal growth from 1990 through 2000, with rates of over 6.8% per year. > Corona eliminated two cities in Puerto Rico for which standard data were not available.  These cuts pared the list from 243 cities to 157 cities. Data was then gathered on those cities to identify specific growth patterns between 1990 and 2000. From that list, 16 cities were identified to have exhibited highly similar household growth patterns to those projected for Fort Collins, based on total household growth, household growth among traditional college-age students, and a higher growth rate among the second group than the first. Fort Collins Rental and Occupancy Study 174 2.3 Packet Pg. 227 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) 2005 Report Case Study Cities *Lexington-Fayette, Kentucky is excluded from all subsequent analysis as the US Census no longer collects annual data for the city. Fort Collins Rental and Occupancy Study 175 Similar Growth Cities Annual Household Growth Annual Household Growth, Ages 15-24 Ratio of Young/Total HHousehold Growth Columbia, South Carolina 2.19% 4.14% 1.89 Durham, North Carolina 2.95% 3.33% 1.13 Eugene, Oregon 2.26% 3.68% 1.63 Fort Collins, Colorado 3.07% 3.34% 1.08 Fort Wayne, Indiana 1.86% 3.20% 1.72 Greensboro, North Carolina 2.12% 3.34% 1.58 Joliet, Illinois 3.06% 3.10% 1.01 Lakewood, Colorado 1.59% 2.74% 1.73 Lexington-Fayette, Kentucky* 1.93% 3.73% 1.93 Lincoln, Nebraska 1.83% 2.73% 1.49 Mesquite, Texas 2.03% 2.52% 1.24 Provo, Utah 2.13% 3.06% 1.44 Raleigh, North Carolina 2.77% 2.69% 0.97 Salem, Oregon 2.09% 3.39% 1.63 Sioux Falls, South Dakota 2.22% 2.93% 1.32 Winston-Salem, North Carolina 2.49% 2.94% 1.18 2.3 Packet Pg. 228 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) 2005 Report Case Studies: Cities with Large Universities *These cities contain colleges or universities with more than 15,000 undergraduates. The sample of case studies shows effective diversity between college towns and comparable cities that have experienced historically similar household growth and composition to Fort Collins. Fort Collins Rental and Occupancy Study 176 Similar Growth Cities Largest University Number of Undergraduates Columbia, South Carolina* University of South Carolina 24,941 Durham, North Carolina Duke 6,501 Eugene, Oregon* University of Oregon 20,220 Fort Collins, Colorado* Colorado State University 22,727 Fort Wayne, Indiana Purdue Fort Wayne 8,746 Greensboro, North Carolina* The University of North Carolina at Greensboro 15,158 Joliet, Illinois NA Lakewood, Colorado Colorado Christian University 3,885 Lincoln, Nebraska* University of Nebraska Lincoln 20,182 Mesquite, Texas NA Provo, Utah* Brigham Young University 30,221 Raleigh, North Carolina* North Carolina State University 22,458 Salem, Oregon Willamette University 1,925 Sioux Falls, South Dakota University of Sioux Falls 1,185 Winston-Salem, North Carolina Wake Forest Unversity 4,866 2.3 Packet Pg. 229 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 177 Methodology Ordinance Violators • Estimated Number • Profile of Violators • Investigation Outcomes 2.3 Packet Pg. 230 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Methodology: Violator Estimates and Profiles Estimates of the number of violators were developed via two means. First, the study team examined specialized census data on a sample of the population, where individual (anonymized) records are made available to the public. This has emerged as the predominant means of developing estimates. As a second check, the public survey was used to develop estimates, in conjunction with complaint data to estimate the accuracy with which residents identify violator households. These are the same two methods used in the past, though specific methodologies have evolved over time. The profiles of violator households are drawn specifically from the specialized census records referenced above. These microdata records are deemed to be accurate since they are gathered for other purposes, but also contain information about household makeup. One limitation of the microdata sample is that relationships within a household are always measured from the perspective of the person who filled out the census form. If that person is not related to others in the household, then it is not possible to identify whether those others are related. The research team took a conservative approach that they were not related, which in most cases is the likely scenario (for example, when all residents are labeled as roommates or boarders relative to the householder). However, some of these may be related in which case some households that are not violators could be labeled as violators. This is unlikely to have a large enough effect on the conclusions to change any findings, though. Fort Collins Rental and Occupancy Study 178 2.3 Packet Pg. 231 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Methodology: Investigation Outcomes Over occupancy investigation outcome results were calculated from complaint, investigation, and outcome records provided by City of Fort Collins Neighborhood Services. These data included the case year (based on investigation start date), the address of the investigated residence, and the outcome determined as either violation or unfounded. Additionally, each residence was assigned to a study area region that aligned with the regions from the resident survey in this report. The dataset analyzed spanned the years 2011 to 2017. Fort Collins Rental and Occupancy Study 179 2.3 Packet Pg. 232 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 180 Methodology Short-Term Rentals • Profile of Units and Revenues • Rental Host Survey 2.3 Packet Pg. 233 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Methodology: Profile of Units and Revenue For the short-term rental market analysis, the research team purchased data that had been scraped from the AirBnB web site by a third-party vendor. (We recognize that other sites exist for short-term rentals, but the STR survey conducted on this project showed a large overlap in advertising across sites.) The data included information on specific properties, including nights available, nights rented, asking price, type of unit, and location. The research team used GIS software to assign the STRs to specific zones relative to STR licensing rules. This also allowed the team to eliminate any properties that were outside the Fort Collins city limits, even if they were in the general Fort Collins market area. Therefore, the figures relates specifically to units inside the city limits. Data were available beginning in October of 2014, and Corona Insights purchased all available data, which at the time of purchase extended through April of 2018. Fort Collins Rental and Occupancy Study 181 2.3 Packet Pg. 234 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Methodology: Short-Term Rental Host Survey The survey of short-term rental hosts was conducted by using the contact list for licensed STR units that is gathered during the licensing process. Corona Insights designed an 10-minute online survey and sent an invitation to complete the survey to every available STR host. We sent 255 survey invitations and received 143 useable responses, constituting a very strong response rate of 56%. Fort Collins Rental and Occupancy Study 182 Comparing Response and Non-Response by Residency Total Residency Primary Non-Primary Non-Response 111 67% 33% In Survey 143 68% 32% Comparing Response and Non-Response by Title Registered Total Title Registered Business Personal Address Other Non-Response 111 32% 48% 6% 14% In Survey 143 36% 50% 5% 8% One way to check the representativeness of a sample is to compare demographic breakdowns within a survey to available data from the population (like a census). While there is no broader demographic data for STR hosts in Fort Collins, comparing available information (residency status and the title of the registered STR) from the total recruited population (registered STR hosts) offers an opportunity to assess representativeness. The similar percentages amongst the two samples provides evidence in favor of the STR survey sample being representative of the population. 2.3 Packet Pg. 235 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Fort Collins Rental and Occupancy Study 183 Methodology Resident Survey • Public Sentiment Toward Occupancy Ordinance • Public Sentiment Toward STR Rules • Citywide Quality Measures • Proximity to Ordinance Violators • Proximity to Short-Term Rentals 2.3 Packet Pg. 236 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Methodology: Resident Survey Survey Instrument To facilitate comparability to previous results, many of the survey questions were asked in the same way as they were asked in the previous community surveys, with some updates where applicable. The final survey instrument was six pages long, printed in black and white, with a cover letter on the first page. The cover letter instructed that any adult resident of the household could complete the questionnaire. It also assured residents that their responses would remain confidential and would not be used for enforcement. To further encourage residents to complete and return the questionnaire, an incentive was offered, which was a chance to win one of two $500 grand prizes or one of ten separate $100 prizes. Lastly, a pre- stamped and pre-addressed return envelope was included to make it easy for residents to return their completed questionnaire. Fort Collins Rental and Occupancy Study 184 2.3 Packet Pg. 237 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Methodology: Resident Survey Sampling Selecting a subset of home addresses to send a survey packet is called sampling. We used a stratified random address-based sampling technique to draw a list of 6,450 home addresses in Fort Collins that each received one survey packet in the mail. We used a stratified approach to send disproportionally more questionnaires to homes in the regions immediately east and west of campus with the goal of collecting enough responses from each region to report results by those segments. The list of home addresses was purchased from MSG, a commercial address-based sampling vendor. Fort Collins Rental and Occupancy Study 185 Region % of Homes % of Sample Away from Campus 66% 34% East of Campus 11% 33% West of Campus 23% 33% Fort Collins 100% 100% 2.3 Packet Pg. 238 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Methodology: Resident Survey Survey Administration Survey packets were mailed in mid-September of 2018. About ten days after mailing the initial survey packet, a postcard was sent to each household to remind and encourage residents to complete and return the questionnaire. Response Rate 1,053 survey packets were returned as non-deliverable. We received and entered 1,366 useable responses, for a final adjusted response rate of 25%. A typical response rate for a community-issue mail-based survey is around 15%. Fort Collins Rental and Occupancy Study 186 Region % of Delivered Surveys % of Returned Surveys Adjusted Response Rate Away from Campus 35% 36% 26% East of Campus 33% 38% 29% West of Campus 32% 26% 21% Fort Collins 100% 100% 25% 2.3 Packet Pg. 239 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Methodology: Resident Survey Weighting In a community survey, it is common for certain demographics to be over or under-represented. For example, mail survey respondents are often older. Additionally, because the sample was originally stratified, it was necessary to check the balance of responses between the three strata. To check and correct for potential skew and response biases, we calculated corrective weights based on the known demographic estimates provided by the U.S. Census Bureau. Three dimensions were used for weighting: region (west, east, or away from campus), owner/renter status, and years lived at current residence (more than two years or no more than two years). The corrective weights were applied to the data so that the results would more closely reflect the community as a whole. All results in this report, including demographic tables, are based on the weighted data. Fort Collins Rental and Occupancy Study 187 2.3 Packet Pg. 240 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) Methodology: Resident Survey Margin of Error The corrected top-level margin of error was +/-4.6% at the 95% confidence level. If we were to conduct this survey 200 times, drawing a new random sample each time, we would expect that our estimates would be within the margin-of-error in 19 of those 20 surveys. The margin of error accounts for the study’s design and weighting effects, which increased the margin of error relative to the size of the weights. The corrected margin of error for each region is shown below. Fort Collins Rental and Occupancy Study 188 Region Corrected Margin of Error Away from Campus ±6.1% East of Campus ±8.0% West of Campus ±9.1% Fort Collins ±4.6% 2.3 Packet Pg. 241 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) About Corona Insights Fort Collins Rental and Occupancy Study 189 Our founder named the company Corona because the word means “light.” It’s the knowledge that surrounds and illuminates an issue; exactly what we provide. Our firm’s mission is to provide accurate and unbiased information and counsel to decision makers. We provide market research, evaluation, and strategic consulting for organizations both small and large. Learn more at www.CoronaInsights.com 1580 Lincoln Street Suite 510 Denver, CO 80203 Phone: 303.894.8246 2.3 Packet Pg. 242 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) DATE: STAFF: January 22, 2019 Cassie Archuleta, Senior Environmental Planner WORK SESSION ITEM City Council SUBJECT FOR DISCUSSION Outdoor Residential Wood Burning. EXECUTIVE SUMMARY The purpose of this item is to discuss a regulatory option to support a goal of allowing wood burning fires in residential areas that do not negatively impact neighbors. Periodically, the City and Poudre Fire Authority (PFA) are contacted regarding nuisance, health and safety concerns from wood smoke in residential areas. This item was identified as a Council priority May 2017, and staff received direction October 2018 to develop a regulatory option that did not ban residential wood fires, but still addressed fires that negatively impact neighbors. Additional direction will be sought regarding adoption of a permit system that allows outdoor residential wood burning with a permit, where permit conditions are designed to mitigate potential smoke impacts on neighbors. GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED Does Council want to proceed with consideration to: • Allow outdoor residential wood burning fires with a permit? • Provide resources to support implementation and enforcement? BACKGROUND / DISCUSSION While many consider the ability to have a wood fire at home an important recreational and social activity, smoke and particles from a wood burning fire can impact the health or well-being of a neighbor who is outdoors, has a window open, or has a poor ventilation system in their home. At the May 2017 Council retreat, outdoor burning was identified as a Council priority and a 2018 budget revision offer was approved by Council to support additional work. Staff received direction at a February 2018 Work Session to facilitate a public engagement effort with the following objective: • Develop recommendations regarding options to better protect human health and reduce nuisance from outdoor wood smoke During the Summer and Fall of 2018, staff conducted research, and facilitated a public engagement effort, and presented results of public engagement at an October 2018 Work Session. Some key findings included: • Wood smoke contributes to particle pollution and breathing wood smoke can be a nuisance or a health concern. At special risk are sensitive populations such as people with heart and lung disease, children and older adults • Smoke from wood fires may travel from one property to another and potentially impact indoor air environments • The ability to have an outdoor wood fire at home for recreational or aesthetic purposes is a desirable amenity for some 3 Packet Pg. 243 January 22, 2019 Page 2 At the October Work Session, Council provided further direction to focus efforts on a regulatory option that only addresses fires that negatively impact neighbors. Strategic Alignment This work is aligned with City plans, principles and objectives, including: • 2011 City Plan o Principle ENV 8: Continually improve Fort Collins’ air quality • 2015-16 Strategic Plan o Neighborhood Livability and Social Health, Objective 1.6, Protect and preserve the quality of life in neighborhoods o Environmental Health, Objective 4.4, Implement indoor and outdoor air quality improvement initiatives Current Regulations Currently, International Fire Code, as adopted by the City of Fort Collins, requires that: • Open burning, or fires with a fuel size greater than 3 feet wide by 2 feet high, require a permit obtained from the fire code official • Outdoor fireplaces, with the exception of 1- and 2- family dwelling, must be gas- or liquid- fueled • Outdoor fireplaces at 1- and 2- family dwellings may use approved solid-fuel (e.g., clean, dry wood) provided that: o The fuel size (e.g., wood pile) is less than 3 feet wide by 2 feet high o The fire is located at least 15 feet from combustible material (e.g., wood decks and fences) o The fire is continuously attended until the fire is extinguished o A fire extinguisher or other fire extinguishing equipment (e.g., a hose) is available for immediate utilization Additionally, City Code section 20-1 prohibits smoke that endangers the health, safety, and comfort of the public. Limitation of using this code for impacts from small residential wood fires include: • Enforcement would require demonstrated proof of impact to the public • A violation of this code would be considered a criminal offense, and a citation would require testimony and evidence of nuisance impacts from the affected party Proposed New Requirements At the October 23, 2018 Work Session, Council directed staff to develop a regulatory option that addresses negative impacts from fires, without fully prohibiting residential wood fires. Fundamentally, this creates complexities in how to implement and enforce a policy that allowed some fires, but not others. Through policy research and stakeholder discussions, a permit system was identified as a preferred mechanism that could support middle-ground regulations that were short of a full ban. For a permit system to work, fires themselves must first be disallowed unless permission (i.e., a permit) is granted. Permit systems for open burning (fires larger than 3’x2’) are already administered at the County level (per State requirements), and approved by the PFA. Other jurisdictions in Colorado (e.g., Steamboat Springs), and many others in the US, additionally implement permit systems for smaller, residential wood burning fires (Attachment 1). Phased implementation would be proposed for a permit system, which would be dependent on allocation of resources for implementation and enforcement. Initial proposed conditions would include: • Require a permit be obtained for use of outdoor solid-fuel burning fireplaces at 1- and 2- family dwellings • Provide proactive, targeted outreach regarding safety requirements and considerate burning practices • Require that the permit is renewed annually 3 Packet Pg. 244 January 22, 2019 Page 3 • Establish authority to require that fire is extinguished, or a permit suspended or revoked, if negative impacts are reported • Establish authority to access and inspect an outdoor fireplace • Exempt fires used exclusively for cooking food for human consumption A permit system would have the ability to evolve, as the program is implemented and evaluated over time. Considerations that could be evaluated for potential future implementation might include: • A permit application fee (initially proposed to have no fee) • Fireplace inspections required for permit approvals • Prohibitions of fires on high particle pollution advisory days • Tolerance limits, such as a limit on the number of fires, number of days or specific times of day (i.e., a curfew) • Limit in certain locations based on proximity/density • Increased active fire response (e.g., non-emergency compliance resources available after hours and weekends) Determination of Impacts An important consideration of a regulatory system to mitigate negative smoke impacts is the characterization of a negative impact. Survey results (as reported previously) indicated that respondents would support policies that require a fire is extinguished when a concern is expressed by multiple neighbors (77%), but there was less support if only one person expressed concern (35%). During Council discussion, concerns were expressed about the concept of multiple complaints, as this could potentially discount impacts to a single, potentially sensitive, individual. A potential enforcement mechanism would be authorization for enforcement officials to make a determination of impacts, supported by policy guidance (to be developed, based on factors used for “unreasonable noise”). Discretion could include, but need not be limited to, consideration of factors such as: • The time of day • Location and proximately of burning to negatively impacted property or person • Whether the burning has a purpose other than aesthetic • Weather conditions • Any other factors tending to show the magnitude, duration and/or disruptive effect of the smoke Per permit conditions, complaints from neighbors regarding negative impacts may be cause to: • Order extinguishment of the fire if the fire is active • Revoke or suspend a permit • Issue a citation for a use of a solid-fuel burning fireplace without a permit Implementation Timeline and Initial Resource Needs For the first phase of implementation (2019), anticipated resource needs would include: • Development of an online, self-certified permitting system o Additional Resources: Staff is currently exploring leveraging existing permitting systems, such as the Special Events permitting system available at (<https://specialevents.fcgov.com/login/>) o Cost: Estimated $5,000 for software and consultant fees (one-time) • Administration, implementation and enforcement of the new permitting system o Additional Resources: Staff time, estimated at 0.25 FTE (average of 10 hrs/week), which would support: ▪ Development and maintenance of new outreach materials ▪ Permit system administration 3 Packet Pg. 245 January 22, 2019 Page 4 ▪ Complaint based permit investigation and response (in-office) ▪ Coordination of limited field-based environmental compliance response, as needed for escalated complaints o Cost: Estimated $18K/year to convert an existing classified 0.75 FTE environmental services compliance support position to 1.0 FTE (additional 0.25 FTE, ongoing) A proposed timeline to develop and implement a new permitting and enforcement process is summarized below: 2018 • February; Additional Outreach o Additional outreach regarding proposed permit process, to include Boards, OurCity e-forum, NextDoor • March; Adoption of new requirements and resources o Council consideration of code updates, and additional resource allocations • April - May; Process development and outreach o Development of permit system and outreach to promote awareness of new requirements • June - December; Year 1 Implementation o Implementation of complaint-based enforcement of permit conditions 2019 • January - March; Evaluation of Year 1 o Evaluation of first year of implementation, including: ▪ Number of complaints ▪ Nature of complaints (e.g., health, nuisance, safety) ▪ Ability to address complaints with voluntary compliance ▪ Permit suspensions or revocations, code violations and any enforcement action ▪ Resources allocated • April - May; Consideration of impacts o Provide a written review to Council summarizing effectiveness of first year of implementation • June - December; Year 2 Implementation o Ongoing implementation, including program/process updates if necessary Community and Stakeholder Engagement A public engagement plan was implemented in the Summer and Fall of 2018, and a summary was presented at the October 23 Council Work Session. Additional outreach conducted since the October Work Session included: • Continued working group meetings, including staff from the Environmental Services Department, Community Development and Neighborhood Services and Poudre Fire Authority • Correspondence with the Larimer County Health District (Attachment 2) o The Health District provided an assessment of the issue, but did not take an official position • Correspondence with Larimer County Public Health and the Environment (Attachment 3) o A representative from the Department of Health indicated that the Department had no opinion on what the City should adopt, and clarified that the County would not have an enforcement role • Presentation to the Air Quality Advisory Board (Attachment 4) • A Triple Bottom Line Scan (TBL-S), conducted by an internal inter-Department Sustainability Leadership Class, which consisted of discussion of questions related to environmental, economic and social impacts (Attachment 5) Proposed Next Steps Staff is seeking direction regarding potential implementation of a new regulatory program which establishes a permitting requirement, and mitigation of nuisance impacts, for outdoor residential wood fires. Depending on direction, staff will proceed to develop code update recommendations. A Council regular meeting would be 3 Packet Pg. 246 January 22, 2019 Page 5 necessary to consider adoption of code changes, and allocation of resources for implementation and enforcement. ATTACHMENTS 1. Permit Examples (PDF) 2. Health District Opinion (PDF) 3. Larimer County Health Director Email (PDF) 4. Air Quality Advisory Board Minutes December 17, 2018 (PDF) 5. Triple Bottom Line Scan Summary (PDF) 6. PowerPoint Presentation (PDF) 3 Packet Pg. 247 Example Permit Conditions for Residential Fires City, State Fee Valid Curfew Notes from permit conditions Elizabeth, CO $0 60 days Permittee shall extinguish the burn immediately if any of the following situations occur: Neighbors complain regarding the smell of smoke travel off the permitee property, winds begin to be too strong or gusty, permitee can no longer monitor the burn, permitee is instructed to do so by EFPD personnel Steamboat Springs, CO $25 6mo 12am The authorities are authorized to require that any open burn or recreational fire be immediately discontinued if they determine that the smoke emissions are offensive to occupants of surrounding property or if the open burn or recreational fire is determined to constitute a hazardous condition. Pagosa, CO $10 annual The District is authorized to require the immediate extinguishment by the permit holder or other person responsible for open burning if the District determines that open burning constitutes or adds to a hazardous or dangerous condition or is offensive or objectionable. Larkspur, CO $0 per burn Permits may be revoked and future permit privileges suspended if the permit holder violates any conditions. Fenwick/Old Saybrook, CT $0 annual If a backyard campfire is bothering a neighbor, the neighbor has the right to contact local authorities to request the campfire to be extinguished. Olathe, KS $25/day 3 day All complaints (smoke, odor emissions, falling ash, etc.) regarding burning will be investigated by the Olathe Fire Department (OFD). The OFD may order the burning be extinguished, if necessary. South Portland, ME annual Upon a written complaint of the fire and/or smoke from the fire, the Fire Department shall request the extinguishment of the fire by the permit holder. The fire shall be immediately extinguished. Grand Rapids, MI $50 annual 10pm Check with your neighbors within 100 feet first. If they object, we have to deny your application. Burnsville, MN per burn 11pm The Fire Marshal is authorized to require that the burning be discontinued if it is determined that he smoke emissions are offensive to occupants of surrounding property. Edina, MN annual 10pm Notify your neighbors about your recreational fire. Fires may be ordered extinguished and this permit revoked by the fire department if: Any recreational fire requirement is violated, A fire hazard exists or develops, we receive valid complaints from your neighbors regarding the fire, smoke or other violations Grand Chute, MN $0 annual 1am All fires shall not create smoke that causes a public nuisance, 1/10/2019 STAFF: BRUCE COOPER, MEDICAL DIRECTOR ISSUE: OUTDOOR RESIDENTIAL WOOD BURNING The Health District of Northern Larimer County has conducted an overview as it pertains to outdoor residential wood burning. Although the area of environmental health is not one of the Health District’s areas of expertise, staff have organized a brief synopsis of prevalent research on the issue of wood smoke in regards to health as a resource in this discussion. Some may believe that because it is a natural substance, that wood smoke from fireplaces, wood stoves, or backyard burning is not harmful. However, wood smoke contains thousands of chemicals, many of which have documented adverse health effects. It has been established that the small particulate matter and noxious gases contained in wood smoke may have serious health effects when inhaled. Epidemiological studies have found that acute exposure to the components of residential wood smoke is linked to not just an increase in respiratory symptoms, but also to decreases in lung function and exacerbations of respiratory illnesses such as asthma and chronic obstructive pulmonary disease (COPD). Controlled studies of acute wood smoke exposure in healthy volunteers have found increases in markers of systemic inflammation and blood coagulation as well as the stiffening of arteries and reductions in heart rate variability. These physiological changes aid in explaining how wood smoke exposure could increase the risk of heart attacks or strokes in susceptible individuals. Certain populations have been demonstrated to be particularly vulnerable to the respiratory effects of wood smoke —people with heart or lung disease, older adults, children, and infants. According to the Health District’s 2016 Community Health Survey, 16% of adults living in Fort Collins had been diagnosed with asthma and 10% reported currently having it. Respiratory events can lead to increased visits to emergency departments and hospital admissions. At current rates of backyard recreational wood burning in the summer it is unlikely that regional ambient air pollution levels would be affected, but levels at the neighborhood or household level could be much higher under certain conditions. Studies have shown that outdoor wood smoke particles can infiltrate into neighboring residences, even with the windows closed, although air‐conditioning may mitigate this effect to some degree. We were unable to find peer‐reviewed studies measuring wood smoke exposure or its health effects from backyard recreational burning. There are many variables in these situations including wind, size of the fire, distance from neighbors, and other factors that could affect exposure. It appears that there may be circumstances where significant wood smoke exposures may occur and individuals with conditions like asthma or cardiac disease, both common, could be impacted. ATTACHMENT 2 3.2 Packet Pg. 249 Attachment: Health District Opinion (7566 : Outdoor Residential Wood Burning) 1 Cassie Archuleta From: Averil G Strand <strandaa@co.larimer.co.us> Sent: Wednesday, November 28, 2018 2:30 PM To: Cassie Archuleta Subject: Re: Connecting regarding outdoor recreational wood fires Yes. Thanks for your die diligence Sent from my iPhone On Nov 28, 2018, at 1:05 PM, Cassie Archuleta <carchuleta@fcgov.com> wrote: Hi Avie‐ Sorry for the slow response, but thanks for this! I will represent to Fort Collins City Council that:  We reached out to the Larimer County Department of Health  You reviewed some of our materials  The Department believes we have done a good analysis of existing regulation  The Department has no opinion on what the City should adopt, and would not have a role in enforcement Would that be an accurate summary from your perspective? Appreciate your time on this! Cassie . . . . . . . . . . . . . . . CASSIE ARCHULETA Environmental Program Manager – Air Quality City of Fort Collins 970-416-2648 office From: Avie Strand <strandaa@co.larimer.co.us> Sent: Tuesday, November 20, 2018 3:44 PM To: Cassie Archuleta <carchuleta@fcgov.com> Subject: Fwd: Connecting regarding outdoor recreational wood fires ‐‐‐‐‐‐‐‐‐‐ Forwarded message ‐‐‐‐‐‐‐‐‐ From: Avie Strand <strandaa@co.larimer.co.us> Date: Mon, Nov 19, 2018 at 10:28 AM Subject: Re: Connecting regarding outdoor recreational wood fires To: <carchuleta@fcgov.com> Cc: Myrna Hansen <hansenml@co.larimer.co.us>, Lea Schneider <schneils@co.larimer.co.us>, Thomas Butts <TButts@larimer.org> ATTACHMENT 3 3.3 Packet Pg. 250 Attachment: Larimer County Health Director Email (7566 : Outdoor Residential Wood Burning) 2 You have done a good analysis of existing regulation ‐ so it seems like you are close to a policy decision at this point if you want to join Denver and Boulder with a ban or if you prefer one of the other alternatives. Word burning in the 7 county metro area is regulated from a health/air quality perspective as described on this web page with exception as listed https://www.colorado.gov/pacific/cdphe/indoor‐burning‐restrictions Most fire limiting regulations are based on fireplaces/ fireplace inserts in areas like the 7 county metro and Aspen areas. A number of other cities ‐ Fire districts regulate these as well (from a fire safety perspective NOT a health or nuisance perspective) Colorado Springs, https://coloradosprings.gov/fire‐department/page/outdoor‐burning‐guidelines West Metro Fire, https://www.westmetrofire.org/968/BBQ‐Fire‐Pit‐Regulations One local retailer provided the following info https://patio.christysports.com/backyard‐fire‐pit‐laws‐colorado Since Air Quality can affect those with Asthma, we looked at Asthma information and found that in Fort Collins 9.6% of the population has ever been told by a medical professional that they have asthma AND currently report asthma. Larimer County Department of Health and Environment would not be involved in enforcement of any Fort Collins regulation relating to backyard burning. On Fri, Nov 16, 2018 at 9:13 AM Cassie Archuleta <carchuleta@fcgov.com> wrote: Hi Avril‐ We have not met yet, but I’m pleased Beth ran into you last night and helped with introductions! As she may have mentioned, I am working on a policy project looking at outdoor residential burning, at the direction of City Council. This is related to neighborhood smoke concerns from outdoor wood fires. They have asked us to be more engaged with Larimer County Public Health – and would specifically be interested in the County’s opinions (if any) on our direction. Attached is a summary of a Council Work Session we had in October, and the follow‐up memo with the direction we received. They have asked us to propose a regulatory option to require that a wood burning fire is extinguished if it is bothering a neighbor. This was considered as an alternative to a full ban (which is how Denver and Boulder approach this issue). 3.3 Packet Pg. 251 Attachment: Larimer County Health Director Email (7566 : Outdoor Residential Wood Burning) 3 I did meet with Myrna last week to discuss, and also sent an email to Shelley De Volo to see if this topic may be of interest to the Environment and Science Advisory Board. Do you have any other suggestions on how best to engage the County? Thanks! Cassie . . . . . . . . . . . . . . . CASSIE ARCHULETA Environmental Program Manager – Air Quality City of Fort Collins 970-416-2648 office 970-407-1203 mobile carchuleta@fcgov.com www.fcgov.com/airquality ‐‐ Averil Strand, RN, MSN Community Health Services Director Larimer County Department of Health and Environment 1525 Blue Spruce Fort Collins, CO 80524 (970) 498‐6760 ‐‐ Averil Strand, RN, MSN Community Health Services Director Larimer County Department of Health and Environment 1525 Blue Spruce 3.3 Packet Pg. 252 Attachment: Larimer County Health Director Email (7566 : Outdoor Residential Wood Burning) 4 Fort Collins, CO 80524 (970) 498‐6760 3.3 Packet Pg. 253 Attachment: Larimer County Health Director Email (7566 : Outdoor Residential Wood Burning) AIR QUALITY ADVISORY BOARD TYPE OF MEETING – REGULAR 12/17/2018 – MINUTES Page 7 b. Outdoor Wood Burning Update Cassie Archuleta, Air Quality Program Manager, provided an update regarding recent Council direction on outdoor burning, and proposed regulatory options that will be presented to Council at a January 22, 2019 Work Session. Background and Community Engagement Outcomes  Project Goal: To develop recommendations regarding options to better protect human health and reduce nuisance from outdoor wood smoke.  Additional Identified Opportunities: To increase safety awareness, health impact awareness and cognizance of regional environmental issues.  Over the past summer, City staff focused on public engagement related to outdoor wood burning. Over the course of this engagement, it became clear that the community is polarized on the issue. Cassie reviewed the available regulatory options and stated that, per Council direction, which is aligned with the AQAB recommendation, staff is developing a recommendation for the middle ground option.  The objective of the middle ground approach is to prohibit recreational wood fires that negatively impact neighbors while encouraging neighborhood dialogue, promoting awareness of safety regulations and potential nuisance concerns, and avoiding the use of first-responder resources. Potential Code Updates: Prohibiting and Permitting  City staff is considering the proposal of two potential code changes to Council. The first would be to define and prohibit unreasonable smoke and the second would be to require a permit for outdoor burning. Cassie would like Board feedback on each of these.  Defining and prohibiting unreasonable smoke could be accomplished with a simple update to the current code. The definition of prohibition of “unreasonable noise” could be used as a model for a new code defining nuisance related to outdoor burning. On its own, the code would only be applicable when a fire is active.  In addition to this, the City could prohibit recreational wood fires without a permit. This would likely by similar to the permit requirements for solid-fuel burning appliances and open burning. Staff will present the potential code updates, new system implementations and resource expenditures to Council on January 22, 2019. Cassie enquired if the AQAB supports the presented code updates. ATTACHMENT 4 3.4 Packet Pg. 254 Attachment: Air Quality Advisory Board Minutes December 17, 2018 (7566 : Outdoor Residential Wood Burning) AIR QUALITY ADVISORY BOARD TYPE OF MEETING – REGULAR 12/17/2018 – MINUTES Page 8 Discussion  Karen asked about restrictions on wood-burning in permanent structures and what distinguishes them.  Cassie stated that the EPA does not certify permanent outdoor burning structures, but City Code requires that new (permanent) indoor burning devices be EPA- certified. This leaves questions about how to enforce this issue of existing permanent outdoor burning structures.  Mark asked how this new system would be better than the existing.  Cassie replied that one important benefit to the new system would be the permitting process, which would allow for more education opportunities. For example, if a complaint is made, the City can check to see if the person burning has a permit. If not, they could follow up with that person to let them know that a permit is required. If a complaint is made against someone with a permit, there could be a potential to revoke the permit, negotiate with the citizen, or remind them of the code.  Karen asked if permits would be seasonal and if a violation would be a criminal offense.  Cassie responded that the recommendation is that permits are renewed annually. Air quality staff are currently looking into the permitting process in other communities.  Greg asked why the City would not charge to obtain a permit.  Cassie responded that keeping the permit free may make its implementation more palatable to start. If the services associated with it require more resources in the future, then the potential for a fee may be evaluated.  Vara stated that the code implies that all residents have at least 15 feet between property lines, which is not the case for everyone in the City. This causes an equity issue; those who can afford larger yards will have the right to burn in their yards, while those who cannot lose the right.  Cassie replied that the 15-foot rule is part of the current fire code. The rule exists as a precaution as it states that the fire must be 15 feet from combustible materials. That having been said, it could be considered an equity issue as those with smaller yards may not have the option to burn.  Chris asked if cooking fires would require a permit  Cassie responded that the purpose of the fire will be considered and that cooking fires will be exempt. 3.4 Packet Pg. 255 Attachment: Air Quality Advisory Board Minutes December 17, 2018 (7566 : Outdoor Residential Wood Burning) AIR QUALITY ADVISORY BOARD TYPE OF MEETING – REGULAR 12/17/2018 – MINUTES Page 9  Arsineh stated that it may be useful if the permitting/education process allows for a log of activities to see history of infractions.  Karen believes that the proposed process is reasonable, but urged staff to clarify any EPA requirements for permanent outdoor burning structures.  Cassie responded that that the City will not seek out infractions, but rather, a complaint will have to be made by a citizen to initiate the process.  Vara noted that the proposed process relies on initiation of a complaint. She asked how the City will ensure that its citizens are aware that they have the right to complain. She’s concerned that messaging about how and where to log a complaint may not reach underserved citizens and believes that a full ban would protect them better.  Cassie noted that educating the public would be a priority, and staff would do their best to reach out to underserved, and translations would be offered.  Arsineh enquired about the website that the City is setting up for permits. She asked if it would also include a place to log complaints.  Cassie stated that this would depend on the resources allocated to set the website up. The first priority will be to get the permitting system in place so that citizens can maintain compliance with code. Currently, complaints can be called in, but in the future an automated intake system may be developed so that people can input complaints on their own and responses can be prioritized.  Mark asked how City staff will judge the success of the proposed process.  Cassie stated that staff would follow up after a year of implementation by providing the Board and Council with a report summarizing effectiveness, similar to the process to implement the fugitive dust requirements.  Mark noted that the option to complain may bring up grievances that would not have existed otherwise.  Arsineh noted that people can have fires and not be bothersome and emphasized the importance of clarifying the intent of this process to lessen potential reaction from those with existing fire pits.  Chris noted that administration burden of a permit system would serve as a disincentive, which may help with the issue. In Summary: There was general support, as the proposed permit system was aligned with the Board’s previous recommendation. 3.4 Packet Pg. 256 Attachment: Air Quality Advisory Board Minutes December 17, 2018 (7566 : Outdoor Residential Wood Burning) Outdoor Residential Fires – Wood Burning Permit Program New regulatory program where residential wood fires require permits, and permit conditions prohibit negative smoke impacts. Positive  Impacts to outdoor and indoor air quality  Opportunities for education and support of environmental stewardship principles Negative  New staff requirements for environmental tracking and reporting Tensions  N/A Positive  Entrepreneurship and innovation could benefit from development lower smoke fireplace options (e.g., CSU energy lab) Negative  N/A Tensions  Business impacts for sale of gas-burning appliances (positive) vs. sale of wood and wood burning appliances (negative)  Health impact savings (positive) vs. cost of permitting (negative)  Community brand of environmental/human health (positive) vs. over-regulation (negative) Positive • Access to healthy indoor air environments • Increase sense of belonging for sensitive populations (e.g., sessions and those with health concerns) Negative  Permitting adds a new process, which may not be accessible to all Tensions  Potential for poor neighbor-to- neighbor interactions (negative) vs. potential promotion of more positive interactions (positive)  In promoting a welcome and diverse community, tensions between those who value wood fires (negative), vs. those that feel impacted (positive) Tradeoffs Results from the Scan highlight that impacts from allowing residential outdoor fires with a permit are mostly positive or neutral. For many of the questions across the three areas, a permitting program will not have a direct or indirect impact. The Triple Bottom Line Scan also highlights that there are many tensions, where impacts from implementing a permitting system can have both positive and negative implications. For example, the scan highlights that a permitting system has both the potential to increase neighbor-to neighbor tensions, but could also lead to greater communication and less conflict among neighbors. To address these tensions, the permitting process would include increased education and outreach efforts. 3.5 Packet Pg. 258 Attachment: Triple Bottom Line Scan Summary (7566 : Outdoor Residential Wood Burning) 1 Outdoor Residential Wood Burning 1-22-2019 ATTACHMENT 5 3.6 Packet Pg. 259 Attachment: PowerPoint Presentation (7566 : Outdoor Residential Wood Burning) Direction Sought Does Council want to proceed with considerations to: • Allow outdoor residential wood burning fires with a permit? • Provide resources to support implementation and enforcement? 2 3.6 Packet Pg. 260 Attachment: PowerPoint Presentation (7566 : Outdoor Residential Wood Burning) STRATEGIC ALIGNMENT Neighborhood Livability • 1.6 Quality of Life Environmental Health • 4.4 Air Quality BUDGET • ESD 2017-18 Ongoing Offer • 2018 revision: $20K Why We Are Here 3 COUNCIL PRIORITY Air Quality • Residential Wood Fires 3.6 Packet Pg. 261 Attachment: PowerPoint Presentation (7566 : Outdoor Residential Wood Burning) Project Goal 4 • Develop recommendations regarding options to better protect human health and reduce nuisance from outdoor wood smoke Project Goal Feb 2018 • Work Session #1 • Public Engagement Plan Mar – Sep 2018 • Public Engagement Oct 2018 • Work Session #2 • Type of regulatory option Jan 2019 • Work Session #3 • Regulatory mechanism 3.6 Packet Pg. 262 Attachment: PowerPoint Presentation (7566 : Outdoor Residential Wood Burning) Findings • Smoke and particle pollution • Nuisance and/or health concerns • Sensitive populations • Smoke can travel • Recreational amenity 5 3.6 Packet Pg. 263 Attachment: PowerPoint Presentation (7566 : Outdoor Residential Wood Burning) Range of Policy Options Status Quo • Safety response, education, outreach, neighborhood mediation services Middle Ground • Regulatory option to address only fires that impact neighbors Ban • Prohibit residential wood fires 6 Policy Research Less regulatory More regulatory 3.6 Packet Pg. 264 Attachment: PowerPoint Presentation (7566 : Outdoor Residential Wood Burning) Proposed Regulatory Framework Objective • Prohibit residential wood fires that negatively impact neighbors Recommendation • Allow outdoor residential wood fires with permit • Permit conditions establish: • Discretion to require a fire is extinguished based on complaints • Ability to revoke permit for continued complaints 7 3.6 Packet Pg. 265 Attachment: PowerPoint Presentation (7566 : Outdoor Residential Wood Burning) Permit Application 8 Conditions • Required for outdoor wood burning • No fee (initially) • Annual renewal Acknowledgments  Safety requirements  Property owner permission  Restriction on high pollution advisory days  Subject to extinguishment and/or permit revocation based on smoke complaints Recommendations • Notify neighbors prior to burning • Low smoke wood burning practices Exemptions • Electric, liquid-fuel or gas- fueled appliances • Non-commercial cooking appliances (e.g., BBQs and smokers) 3.6 Packet Pg. 266 Attachment: PowerPoint Presentation (7566 : Outdoor Residential Wood Burning) Smoke Complaint 9 Enforcement Discretion Health/ nuisance concern Location/ Proximity Time of day Purpose Frequency /Duration Evaluation of factors 3.6 Packet Pg. 267 Attachment: PowerPoint Presentation (7566 : Outdoor Residential Wood Burning) Complaint Response Process 10 Complaint Received • Nature of concern • Source location/proximity • Weather conditions • Time of day • Frequency Permit Research • Source location known? • Permit obtained? • History of complaints? Permit Enforcement • Notify of requirements? • Citation for burning without permit? • Suspend or revoke permit? 3.6 Packet Pg. 268 Attachment: PowerPoint Presentation (7566 : Outdoor Residential Wood Burning) 11 Triple Bottom Line Scan (TBL-S) Results Environmental • Positive • Indoor and outdoor air quality • Education and outreach opportunity • Negative • Resources needs Economic • Positive • Innovation (e.g., CSU Energy labs) • Tensions • Gas appliance vs. wood appliance sales • Community brand of environmental/ health vs. over- regulation Social • Positive • Access to healthy indoor air • Negative • Accessibility of process • Tensions • Better vs. worse neighbor relations 3.6 Packet Pg. 269 Attachment: PowerPoint Presentation (7566 : Outdoor Residential Wood Burning) Implementation and Enforcement Resource Needs • Permitting system (software updates): ~$5,000 (one-time) • Implementation and enforcement (Environmental Services): 0.25 FTE; $18K/year (ongoing) 12 Timeline and Resources Outreach/Adoption Feb – Mar 2019 • Additional outreach (Boards, OurCity e-forum, NextDoor) • Council consideration/ adoption Initialization April - May 2019 • Develop self- administered permit system • Develop initial outreach Year 1 June – Dec 2019 • Permit system administration • Complaint driven permit investigation • Limited field response Evaluate Year 1 2020 • Evaluate effectiveness • Recommend updates/changes 3.6 Packet Pg. 270 Attachment: PowerPoint Presentation (7566 : Outdoor Residential Wood Burning) Direction Sought Does Council want to proceed with considerations to: • Allow outdoor residential wood burning fires with a permit? • Provide resources to support implementation and enforcement? 13 3.6 Packet Pg. 271 Attachment: PowerPoint Presentation (7566 : Outdoor Residential Wood Burning) Additional of process and increases resources vs. ability to address negative impacts from wood smoke in neighborhoods Mitigations  Leveraging existing resources for new program implementation to extent policies  Make permitting process accessible  Provide resources to facilitate more productive neighborhood conversations IMPACTS ATTACHMENT 5 3.5 Packet Pg. 257 Attachment: Triple Bottom Line Scan Summary (7566 : Outdoor Residential Wood Burning) complaints from neighbors, or a visibility hazard on any form of transportation route. Columbus, OH $75 per burn If there are ANY complaints from neighbors, immediate extinguishment must be done. Complaints might include, but are not limited to, smoke drifting into their house, embers drifting to their property and/or fire getting out of control. Appleton, WI $15/$30 day/ season 10pm Applicants are encouraged to speak with surrounding neighbors regarding outdoor fire usage to reduce the possibility of nuisance complaints and discontinued outdoor fire use. Laramie, WY If it is determined by the fire chief (or their designee) that smoke emitting from the burn is offensive to occupants of surrounding properties, or constitutes a hazardous condition, they may require the burning be discontinued. ATTACHMENT 1 3.1 Packet Pg. 248 Attachment: Permit Examples (7566 : Outdoor Residential Wood Burning) 80% 90% 100% Uncontrolled pets running loose* Criminal activity Disruptive parties Loud noise other than parties, such as stereos or yelling Parking vehicles inappropriately Trash or junk in the yard Poorly maintained house Two or More Observed Violators 2004 2008 2018 2.3 Packet Pg. 214 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) a poorly maintained house. 2.3 Packet Pg. 207 Attachment: Corona Insights Rental Market Report to Fort Collins (7567 : Occupancy Study) 22 44.1 - Sustainability Services Admin O 501,633 439,133 0 0 62,500 0 0 23 5.3 - Citywide Volunteer Services Program O 186,417 0 0 0 186,417 0 0 25 50.2 - Facilities Operations O 9,639,547 9,526,230 0 0 0 0 113,317 Equipment Fund 26 68.1 - Special Event Coordinator O 132,846 132,846 0 0 0 0 0 28 50.4 - Required Building Modifications O 600,000 0 600,000 0 0 0 0 30 52.2 - Performance & Program Evaluation (P&PE) O 108,123 108,123 0 0 0 0 0 108,123 0 108,123 31 52.5 - FC Lean - City of Fort Collins Continuous Improvement Program O 93,081 93,081 0 0 0 0 0 93,081 0 93,081 1/9/2019 Page 4 of 5 1.1 Attachment: January 2, 2019 Work Session Summary (7570 : Keep Fort Collins Great Sunset) Dispatcher 1.00 E 74,819 0 0 74,819 0 0 KFCG dedicated to Fire Funded Subtotal 12.70 $78,455,458 $67,333,133 $1,730,522 $9,077,547 $71,752 $242,504 $0 $180,438 $20,000 $200,438 TRANSPORTATION 1 1.2 - Transportation Capital Expansion Fee Program O 3,303,437 248,739 0 0 0 3,054,698 TCEF 2 34.1 - Traffic Operations O 3,324,079 0 0 0 344,151 2,979,928 Transportation Fund 3 34.2 - Traffic Operations Equipment O 238,715 0 0 0 238,715 0 5 1.1 - Engineering Core Offer O 2,142,700 383,193 0 0 0 1,759,507 Transportation Fund 6 6.1 - Transportation Planning Services O 485,315 0 0 0 86,438 398,877 Transportation Fund 7 45.1 - Transit Local Fixed Route Network O 17,837,194 7,341,750 148,988 0 2,177,516 8,168,940 Transit Fund 8 45.3 - Dial-A-Ride Service O 2,088,000 860,080 0 0 0 1,227,920 Transportation Fund 250,000 0 250,000 1/9/2019 Page 3 of 5 1.1 Attachment: January 2, 2019 Work Session Summary (7570 : Keep Fort Collins Great Sunset) 51 43.6 - ENHANCEMENT: Accelerated Municipal Electric Lawn and Garden Equipment Fund 20,000 0 20,000 0 0 20,000 20,000 Funded Subtotal 0.00 $5,688,061 $1,600,759 $306,500 $0 $614,801 $3,166,001 $454,355 $161,000 $615,355 SAFE COMMUNITY 1/9/2019 Page 2 of 5 1.1 Attachment: January 2, 2019 Work Session Summary (7570 : Keep Fort Collins Great Sunset) Maintenance of New Parks and Trails 2.00 E 172,090 0 0 172,090 0 0 22 58.5 - ENHANCEMENT: 4.5 FTE (Multiple positions) - Gardens on Spring Creek Expanded Programming and Operations 4.50 E 233,985 233,985 0 0 0 0 233,985 0 233,985 23 47.7 - KFCG ENHANCEMENT: 0.25 FTE Increase - Adaptive Recreation Coordinator 0.25 E 14,867 0 0 14,867 0 0 KFCG dedicated to Culture & Recreation 25 26.3 - ENHANCEMENT: Design and Cost Estimates for Irrigation System Replacement at SouthRidge and City Park Nine. E 125,000 0 125,000 0 0 0 Skipped due to needing ongoing 28 57.4 - ENHANCEMENT: Increased Contractual Pruning of Larger Trees E 200,000 0 200,000 0 0 0 Skipped due to needing ongoing TARGET REDUCTION 1/9/2019 Page 1 of 5 1.1 Attachment: January 2, 2019 Work Session Summary (7570 : Keep Fort Collins Great Sunset)