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Housing

How emergency declarations in Colorado’s high country housing crisis smooth the path to more homes for locals

A "disaster" resolution over housing in Crested Butte enables the town to bypass codes, buy a hotel, remove limits on downtown camping and curtail short-term rentals. More communities are planning similar declarations as high country housing crisis reaches a crescendo.

Ali Fuchs, owner of Al's Bicycle Heaven in Crested Butte, Colorado stands in her shop on Elk Avenue on June 19,2021. Fuchs, who has owned Al's Bicycle Heaven since 2006, cannot find enough employees to help run her business due to a housing shortage. Fuchs has successfully challenged Crested Butte's building codes in order to build two, deed-restricted one-bedroom apartments behind Bicycle Heaven. (Dean Krakel, Special to The Colorado Sun)
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Ali Fuchs wants to build two, deed-restricted one-bedroom units behind Big Al’s Bicycle Heaven, her shop in downtown Crested Butte.

The town’s zoning code requires two parking spaces per unit. But she doesn’t need four spaces. With only two tenants, she needs two spaces.

“Because that makes sense,” she said. 

The impasse led Fuchs to hire both an architect and an attorney to craft an amendment to the town’s zoning codes. She’s asking for a new land use category in Crested Butte: Employee Dwelling. 

“I could build an office for 15 people and pay a fee for parking. But I can’t do that for residential. And we need residential more than anything. There are a lot of backward things in our code,” said Fuchs, who opened her shop in 2006 and has been able to hire only eight of the 15 employees she needs. “I literally do not know what I’m going to do to get through this summer.” 

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Last week, Crested Butte’s travel leaders posted a note warning visitors to expect long waits and closures at short-staffed businesses. They asked for “patience and kindness” as the town grapples with a housing crisis that “painfully impacts those who keep this beautiful place running.”

That followed a first-of-its-kind resolution by the town council on June 7 declaring a “Local Disaster Emergency Regarding Affordable Housing.” More communities, including Frisco and Summit County, are considering similar measures. Local leaders say the declarations are the quickest path to creating more attainable housing in a real estate boom that is driving local workers out of communities.

Crested Butte’s resolution allows the town to bypass provisions in the municipal code. It can allow for speedy approvals of residential use in the tourism district. It can allow the council to suspend the requirement demanding two parking spaces per residential unit. The declaration also removes limits on camping and RV occupancy on private property inside the town limits.

The emergency declaration also allows the town to “be more creative” when securing private partners to develop affordable housing, Crested Butte administrator Dara MacDonald said. 

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Crested Butte has regulated short-term rentals for years, capping 30% of all homes in town as short-term rentals. That’s about 212 properties. As the town studies whether that is too many, the emergency declaration will allow town leaders to suspend all license transfers for properties that change hands. Changing the cap on short-term rentals would take months as a formal amendment to the municipal code. 

“But under the emergency declaration we could suspend this activity immediately,” said MacDonald, who hopes the town could then launch a public process to study short-term rental numbers and regulations.  

Visitors to Crested Butte, Colorado patronize restaurants and businesses along Elk Avenue with “Help Wanted” signs posted in the windows and doors on June 19,2021. (Dean Krakel, Special to The Colorado Sun)

The Crested Butte town council also recently approved the $2.3 million purchase and conversion of a six-bedroom bed-and-breakfast into rooms for town employees. Town staff, citing an inability to hire six seasonal employees this summer due to a lack of housing, said it would work with the zoning board to modify codes for the property to allow for affordable housing. The emergency declaration could expedite that process.

At the same June 7 council meeting, two business owners said they were struggling to hire and retain employees due to a lack of housing. The two proposed closing “every business” in the town for the first week of July as a local strike “to set the tone of what Crested Butte would look like if people could not live here,” the meeting’s public comments read. 

Ideally, the declaration sets Crested Butte up for easier access to the surge of federal and state funds about to flow into affordable housing. But federal and state housing programs struggle with the cost of land in mountain communities. And the wealth of some residents in mountain towns can disqualify areas from programs that provide housing to lower income residents, because region-wide income levels are skewed by the growing wave of work-from-anywhere professionals. 

“We are hopeful that by raising awareness of the situation, we can nudge these funding agencies to rethink their tools and their ability to provide funding assistance,” said MacDonald, noting her town has two projects underway that could qualify for state and federal support. 

MacDonald, like most leaders in mountain communities, knows she cannot build their way out of this crisis. The town has reached its five-year goal of having 25% of its homes deed restricted — 305 units — but the problem of affordable housing “persists and is growing worse,” she said. (Crested Butte’s mix of deed-restricted housing includes homes priced below market and owned by locals that can only appreciate at 3% a year as well as long-term rental properties.)

“We hope that the emergency declaration and bringing the issue even more to the forefront will stimulate creative new ideas and solutions for our community,” she said. “So we need everyone to dig in, be creative and come up with new solutions to help us actually get ahead of the problem.”

The Ruby of Crested Butte, 624 Gothic Avenue ,on June 19, 2021. The Crested Butte town council recently approved the $2.3 million dollar purchase of The Ruby and will convert the bed and breakfast into housing for town employees. (Dean Krakel, Special to The Colorado Sun)

Lessons from Aspen

The nation’s oldest mountain resort housing program is the Aspen Pitkin County Housing Authority, which oversees close to 3,000 deed-restricted units in one of the country’s most expensive communities. Other communities are decades behind APCHA, and they are learning from the venerable authority’s successes and struggles.

Skippy Mesirow, the Aspen city councilman who chairs the housing authority board, said a dedicated funding source and requiring developers to build affordable units to help house employees who will work at the new projects, has helped Aspen keep workers living in the community where they work. 

“There is no community character without the characters who live in it,” said Mesirow. 

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But the program is lagging, he said, with aging infrastructure. Some homes are not as well kept as others, so when an owner moves, a new resident can inherit all sorts of problems. And as APCHA celebrates 40 years in the Roaring Fork Valley, a growing number of residents are retiring in their homes, sharpening debate over the concepts of workforce housing and community housing.

But even greater than the second-generation struggles of Aspen’s housing authority, Mesirow said, is “a misalignment in the process” of home building in and around Aspen.  

The last thing the Roaring Fork Valley needs is a $25 million spec home that will sit empty 50 weeks a year. That, however, is a use-by-right and one of the easiest things to build in Pitkin County. 

Christine Benedetti and Skippy Mesirow stand outside Mesirow’s rental home in Aspen in 2018. The two served on Aspen’s Next Generation Advisory Committee, which is working to enlist younger residents in city politics. The committee, chaired by Benedetti, urged community discussion on balancing housing for both younger workers and retirees. (Brian Bitterfield, Special to The Colorado Sun)

“But propose quality high-density housing for the people who make this community run and you have to jump through every possible hoop and that fundamentally does not make sense,” Mesirow said. “We need to flip that around. We need to realign the process so we get what we really want.”

“A genuine crisis” in Summit County

Summit County is poised to officially declare an emergency over housing as well. Three factors have converged as the community crawls out of the pandemic to create what Summit County Commissioner Tamara Pogue calls “a genuine crisis.”

Adjacent communities in Clear Creek, Lake and Park counties that once housed resort-town workers are filling up and have their own vibrant economies that are eliminating the need to commute to work in Summit County. The number of short-term rental homes is growing. And more people are living full-time in towns like Breckenridge, Dillon, Frisco and Silverthorne. 

New studies show the vacancy rate for homes in Summit County is about 50%, down from a longtime average of about 75% in communities populated with second-home owners. The housing issues are challenging businesses and the tourism-based economy in the mountain community, Pogue said. 

Last week the county waived permit fees for anyone who is building affordable housing. That applies to homeowners building an accessory dwelling unit in their backyard as well as to developers proposing apartment complexes. The county is exploring locations for winter camping. The county and towns are master leasing a hotel for workers and searching for other hotels to lease long-term.

Summit County has 13 parcels for affordable housing and about $17 million in its housing fund. The county recently learned it will receive $6 million in federal stimulus money and will direct half of that to housing. 

“That still is not enough for a 3,500-unit deficit in our community,” Pogue said. 

The emergency declaration is part message, she said. It’s a sign for state leaders to adjust income and cost requirements to better accommodate mountain communities, where wealthy residents skew median income levels and land costs are exponentially more than urban locations. And it’s a calling for developers to work with Summit County on housing. 

“We really hope the state can change their funding guidelines to better support the needs of mountain communities. We want to send the message that we are an innovative community and willing to explore any and all help we can get. We need partners,” Pogue said. “We know that if we don’t figure out how to create 1,000 new units in the next 12 to 18 months, it will change the fabric of our community.”

Frisco Mayor Hunter Mortsenson is working with his town council on an emergency declaration that would redirect town employees toward housing. 

“For the pandemic, we had four staffers become everything pandemic related and they were key for the town getting through it as well as we did,” he said. 

“Still not enough”

There are close to 4,000 short-term rental properties in Breckenridge, roughly the same as the rest of unincorporated Summit County. Those units are critical to housing visitors to the town and the local ski area, which ranks in the top two busiest ski hills in the country, alongside Vail.

Town leaders are working on an incentive program to help owners of those short-term rentals offer their properties to locals for long-term leases. The town also is building affordable homes as fast as it can, with 80 affordable rental units under construction at the new Alta Verde community, another 200 planned and 27 units for town employees approved last week. In the last 20 years, Breckenridge has built 1,700 affordable units.

Breckenridge Mayor Eric Mamula repeats the same mantra echoing across Colorado’s high country. 

“Still not enough,” said Mamula, who is working more than full-time bussing tables and serving food at his restaurant, Downstairs at Eric’s. 

He’s paying $17.50 an hour for kitchen help, up from $15 an hour last summer. His waiters make more than most. Still, he’s been able to hire only half the staff he needs. 

“This thing is just rippling through the entire community,” said Mamula, who joins Pogue in hoping the emergency declaration “sends the message that we are in the middle of an intense crisis right now.”  

It’s not just a ski town problem. Businesses across Colorado are suffering from a labor shortage worsened by a lack of workforce housing. 

“We just went over a cliff and there’s no stopping it now,” said Erin Eddy, who recently announced he was closing the Ouray Brewery early every night “due to the proliferation of second home ownership and VRBOs in the city of Ouray and a directly related extreme shortage of any long-term rental properties available for employee housing.”

Ouray is considering a plan to allow local workers to camp at a local park. Telluride housing advocates are pushing for high-density housing projects in communities around the resort town. That will help, but the root of the problem, Eddy said, is that more and more Ouray homes are converting to short-term rentals or being purchased by out-of-towners as vacation homes. 

“I don’t see how things can get better,” said Eddy, who opened the Ouray Brewery in 2010. “When I start losing all my high school kids in August, I will have to extend my closures to maybe two nights a week or even two full days a week.”

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