TELLURIDE
Karla Sanchez spent five years raising her four children in a small apartment in Shandoka, Telluride’s first subsidized housing complex.
Last year, her youngest girls, 18-year-old twins, began working locally. The town’s recently overhauled housing rules required Sanchez to begin reporting their income. The income of her son, who is paying his way through college but comes home to Telluride during breaks, was also counted.
Under new regulations that tie rent to earnings, the family’s monthly rent payments for their three-bedroom apartment went from $1,800 to $2,400 and then $3,600, “even though I’m the only one who is supporting the household,” says Sanchez, who works 9 a.m. to 10 p.m. in Telluride for a cleaning company.
So Sanchez moved to Montrose with her twins. It took many months — and help from a nonprofit advocate — to get her security deposit back from the town. Today, Sanchez commutes at 7 a.m. from Montrose to get her daughters to school and then they have to wait late into the night when their mother gets off work.
“Now I’m putting my two daughters at risk every day because I have to get them to school on time. They have to wait until nightfall to return to Montrose every day, arriving home at 11 p.m.,” she says in an interview. “And then being ready before 6 a.m. the next day to return to Telluride. It has truly affected us.”
The Sanchez family’s story is one of many in Telluride as tenants in 201 town-owned units in five complexes grapple with new rules that have linked the cost of rent to their income. Many of them are leaving. And the town in early April had nearly 50 empty units, sparking concerns that the new rules are actually working against the people they were designed to help.
“Particularly onerous” regulations
“The requirements here are particularly onerous,” said David Zemke, a local attorney who gets one call a week from tenants seeking advice on navigating the town’s new rules. “In a community that knows the seasonality of their economy that relies on seasonal workers, you would expect a little more empathy. I mean these are the people you are supposed to be helping and they are actually holding people down and keeping them down.”
Zemke said many tenants calling him lost work during the recent ski patrol strike and shut-down of the ski resort in late December. They are behind on the required work hours to qualify for housing as well as money for rent.
A lot of the tenants are telling Zemke they are not going to be compliant by the end of the season, just because of those two weeks without work and the residual slowdown. They are bracing to be kicked out of their homes, he said.
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Some residents tell Zemke they are being watched by town officials who send them notes warning they are out of compliance. The Colorado Sun spoke with several tenants who asked not to be named, fearing their criticism could yield backlash from administrators of the housing program.
In 2023, Telluride officials surveyed residents of the rental units the town owns and manages and found that about 50% of tenants in three of the town’s five housing complexes were out of compliance with regulations when they signed leases, mostly because they were earning too much to qualify for the subsidized housing.
So the town launched a year-long overhaul that included annual renewal procedures that required tenants to document all their income sources. Rents were linked to incomes with tenants directing 30% of their income toward rent. The new rules replaced a system that checked income when residents were applying for housing but did not repeat that check when their leases were renewed.
The revamped regulations followed the exceptionally tight Colorado high-country housing market that spilled from the pandemic, when home prices suddenly doubled and demand for housing skyrocketed with exponentially more applicants than available homes and waiting lists that ultimately stretched for many years.
But that was then. Today, the state’s tourism economy is slowing. A dismal winter pinched the flow of vacationing skiers, and a ski patrol strike and resort shutdown in late December pretty much forced Telluride to go dark in its busiest season. Across the high country, resort communities have spent tens of millions on additional housing in the last five years and those new units are easing the crunch. That once out-of-control demand for housing is softening.
But a vacancy rate like Telluride’s — near 25% in town-owned properties — is extraordinarily high for Colorado’s mountain towns, where empty affordable units account for about 2% to 5% of the total available, with most of those vacancies connected to renovations and maintenance.
As housing becomes harder to find, it’s reasonable that new rules would help manage the shortage. But in Telluride, locals say, the new rules and soaring rents are forcing people to leave and that is the reason units are sitting empty.
“The system is not functioning as intended”
A statement from Tri-County Health Network, which was read during the March 30 Telluride council meeting by behavioral health program administrator Kerry Brock, said the network is fielding “consistent and concerning feedback” from residents that current policies and enforcement “are contributing to instability” rather than providing support.
The network sees direct connections to community health and housing. The vacancy rate and high turnover are “difficult to reconcile” with the need for housing, Brock said.
“Together these trends suggest the system is not functioning as intended and may reflect unintended consequences of policy changes,” reads the statement, which noted “the complicated nature” of income-based rent, eligibility thresholds and minimum employment requirements are “making it more difficult for residents to remain in town housing.”
The statement, which highlighted ongoing maintenance issues and delays in returning security deposits, noted “a fear of retaliation” among residents who are openly critical of the town housing system.
“These are not just policy challenges, they are human ones,” Brock said. “Families are being displaced. Long-term residents are leaving the community. Many individuals are experiencing a growing sense of disconnection and instability.”
The network urged the council to launch an immediate review of its housing policies.
When the new rules went into effect in January 2025, 82 residents saw their rent increase, with 35 of those seeing rents spiking by more than 49%. But 35 households saw their rent fall and 57 residents paid the same rent.
The new rules also required residents in town housing to work 1,400 hours per year in town.
All the grousing over new rules is somewhat expected. What wasn’t anticipated: vacancies. Out of 201 apartments the town of Telluride built for local employees, the town last month reported 49 empty units, a vacancy rate of nearly 25%. (About 15 of those units are undergoing renovations.)
DeLanie Tapson, Telluride’s director of community services and former mayor who runs the housing program and qualifies tenants, in February told the town council that the high vacancy rate “is not because of a lack of demand,” but instead is due to a mix of turnover, renovations, “a very stale waitlist” as well as the capacity of town staff to process applications.
On Apr. 8, Tapson sent out an email to everyone who was on the waiting list, announcing a new approach. Saying there were “multiple available” units, Tapson said the first people to reply to the email will be offered apartments “regardless of current position on the waitlist.” The list included units of all sizes — one-bedroom to four-bedroom — at all five of the town’s housing properties.
Is “the rent treadmill” a goal of affordable housing?
Town councilman Dan Enright has lived in town-managed affordable housing for 14 years. Vacancies were “nonexistent,” he said, until recently. He has been an ardent opponent of the overhaul for the last two years, arguing that an over reliance on a person’s gross income as a basis for rent “disincentivizes people from wanting to take on extra work and contribute to the local economy.”
San Miguel County’s 2025 housing needs assessment determined the region needed 1,114 new units by 2034, with more than three quarters of them in Telluride and its sister community a free gondola ride up the mountain, Mountain Village.
“How can we hold that as true while simultaneously, for at least six months now, having nearly 50 vacancies in our rental housing program? Those two facts seem irreconcilable and to me, that just screams ‘crisis,’” Enright said.
What is the purpose of the housing program? Enright asked. Support the economy and local businesses with homes for workers while maintaining a year-round “community of real residents” that makes Telluride thrive, he said.
“These rules and how we’re executing them are antithetical to both those goals,” Enright said. “The system we have built feels unsustainable for so many people and they are choosing to take on long commutes or leave the community altogether. That is a complete disservice to our town. It feels so bad that we can’t recognize that our own rules and how we are implementing them are the problem.”
Keeping residents on “the rent treadmill” with constantly increasing rents as their income rises makes it difficult for locals to move out of affordable housing and into a home of their own.
“That becomes this endless cycle of never getting ahead,” said Enright, sipping coffee at the base of the ski area as almost a dozen constituents say hello in a half hour. “We as leaders need to be leading with compassion and understanding and empathy. We need to see that our rules are having real impacts on real human beings. We are creating a system to catch a few bad actors instead of creating rules that support the vast majority of people trying to make it in this community.”
After a long line of commenters outlined their criticism of the new rules, the council in February removed earnings by teenagers from household income scrutiny. They also lowered the minimum required annual work hours to 1,200 from 1,400 and reduced the requirement that rent payments account for 30% of a tenant’s income. (The federal government affordability guidelines suggest that people spend no more than 30% of their income on housing, including utilities.)
At the Feb. 24 meeting where the council made these adjustments, Telluride Mayor Teddy Errico urged patience “to let the changes roll through the program.”
“We know we are not perfect and we have our challenges but we still think that although there are some mistakes being made and it breaks my heart when people have to move, we will always move forward with what we think is best for the community as a whole,” Errico said in an interview. “If we determine, as we get all this feedback, that we overcorrected the policies that were not working we will continue to adjust.”
Still, Errico said, the level of tenant-ready vacancies “is unacceptable.”
Twenty years ago the housing program was designed to give residents a breath so they could take the next step into free-market housing. Now renting residents are many steps away from paying around $3.3 million for a home.
“And we have not caught up with that and it’s only getting worse,” said Errico, a local real estate broker.
Last month the town launched construction on a long-planned workforce housing project on a parcel and homesite the town purchased in 2018 and 2021 for close to $6 million. The Canyonlands/Tower House project is a first for the town, with a partnership with a private developer — Servitas LLC — that will offer 28 rental units, eight deed-restricted condos for sale and three free-market townhomes.
The success of that project — with a developer mixing in free-market homes so everything pencils — “could unlock our ability to release and design more units,” Errico says.
But the vacancies in existing units are troubling.
“When we have vacancies, that could potentially hurt our ability to fund more housing,” he said. “The vacancies hurt the town of Telluride in a lot of different ways.”
Vacancy rates in other communities are much lower
The Summit County Housing Authority has a property management company that handles its rental properties, but the authority does have master leases on two hotels that have been converted to housing for workers earning 40% to 60% of area median income. The AMI for Summit County last year for one person was $93,100.
Back in 2020, 2021 and 2022, vacancy was zero in all the county’s rental units and demand “was over the top,” housing authority co-director Lina Lesmes says.
That’s when the county started converting hotels. And over the last five years developer Gorman and Co. has built several hundred affordable units in Summit County.
The focus on housing has eased demand and the lackluster winter in a county with four major ski areas also released a bit of pressure.
The vacancy rate in the county’s rental units is less than 7%, up from zero four years ago.
“We have seen a softening, but that does not mean there is no demand,” Lesmes says. “But that’s an improvement from zero vacancies. It’s important to note that every time we have seen this type of softening in our housing market, it’s always temporary. It’s a blip in the history of our community and then it goes right back.”
Eagle County has spent $70 million on 1,000 units in the last five years. Eagle County Housing and Development Authority has around a 2% vacancy rate for those units. That is due to the time to turn over units, “not a lack of demand for rentals,” Eagle County Housing Director Kim Bell says.
The waitlist in Eagle County is 5 to 10 years for two county-managed senior facilities in Eagle and the wait for workforce housing is 1-3 years.
“But with little turnover, we rarely get through our wait lists,” Bell says.
Following the Aspen model
Dave Johnson was among the very first residents to move into the new Shandoka complex in December 1990. A former town councilman who used to manage Shandoka , he calls it “community housing.”
“I detest the term ‘workforce housing,’” he says. “These are our homes.”
He says there are many residents who saw their rent drop under the new rules that peg rent to income. He understands that the new regulations were trying to fix an imbalance with some residents paying way less than they could afford and others struggling to keep up.
Johnson sees the struggles with the new program as “a natural result of the progression of a growing ski town.”
All the mountain towns in Colorado are following Aspen, Johnson says, where the Aspen/Pitkin County Housing Authority has managed affordable housing — now more than 3,000 units — since 1982.
A majority of those units managed by APCHA are owner-occupied, deed-restricted homes and the authority directly manages about 400 rental units. Matthew Gillen, the executive director of APCHA, said they have few vacancies, mostly due to renovations or maintenance. But the authority occasionally struggles to fill units set aside for the lowest earners: people making 40% to 50% of the area median income. (APCHA has a category that allows renters making as high as 240% of AMI to qualify for housing. The AMI for Pitkin County last year for one person was $96,150.)
Johnson, in seeing Telluride following Aspen’s lead, says his town is “making the same mistakes,” by letting bureaucracy eclipse community.
Johnson asks if a teacher should get a higher chance of landing a home in a lottery than, say, a lift operator.
That is value judgement not based on community preservation as much as an important way to filter a large number of applicants seeking too few homes, he says.
“These new rules are not really community oriented,” he says. “Ultimately, the thickness of your rule book is a measure of how much your housing program is failing.”
Johnson, who is quick to assign blame for recent housing woes on the out-of-whack housing market and not the town administration, is hoping a new resident advisory committee can help the town better track the number of people who are moving out instead of dealing with the new regulations.
“If that number is substantial, we should be ready to acknowledge that we blew it and should have anticipated that,” Johnson says. “I do know there is a substantial portion of the residents and applicants who feel intimidated by the bureaucracy. There is fire behind that smoke”
“This system is eroding the culture of Telluride”
Mark Rineer lived in town housing for five years before marrying and moving into a four-bedroom apartment at the 30-unit Sunnyside complex in October 2022. With his wife and her kids, the new home in the new complex — built by the town and San Miguel County — “was a godsend,” Rineer said.
Rent was $2,450 a month. Rineer, a restaurant manager, and his wife, who works for the ski resort, thought they would raise the kids in the home. The next year the town told them 50% of the tenants in town housing were out of compliance and their rent climbed to $2,850.
A year later, as the town installed new rules that anchored rent to income, it was $4,400.
“What they did was put us against a wall and tell us they were going to keep us there. Any kind of success you have going forward, they are going to keep 30% of it. That was psychologically debilitating,” said 42-year-old Rineer. “We were trying to make Telluride a better place and they were punishing us for that.”
Rineer started going to Telluride council meetings, urging council members to consider the impacts of the new rules. He was planning to move his family into an RV in Norwood. But in May last year Rineer and his wife moved into a deed-restricted house in Ilium, a small community on the San Miguel River downstream of Telluride, paying $3,300 a month for their own home.
He’s still advocating for his neighbors in town housing, attending council meetings and urging an overhaul of the new rules.
“It is easier to move away and live any place in the country than it is to wade through the quagmire that is affordable housing in Telluride. And it’s not really affordable,” Rineer said. “When you are spending $4,400 a month, you don’t have any money to spend in town. You can’t even buy a cup of coffee. This system is eroding the culture of Telluride and making it so no one lives here anymore.”
Rent from $2,200 a month to $4,000
One resident, a nonprofit employee who asked that we not use her name for fear of retribution by housing personnel, also won the lottery for a place in Sunnyside in 2021, a few doors down from Rineer. She and her partner moved in thinking they were in a lower income tier and their rent would be $1,800 for a two-bedroom. Those new units reserved for her income category were full, so town officials bumped them up to the $2,200-a-month tier, plus utilities. Then it climbed to $2,575 the next year.
The resident launched her own business last year and her first clients made the business look like her annual income would soar so the rent climbed to $4,000. She, like Rineer, started going to council meetings, urging consideration of gig-type jobs that are hardly consistent and how that work impacts income projections and, subsequently, rents.
Paying 30% of her gross income on rent was closer to half of her take-home pay, says the resident who also takes shifts as a bartender to help pay down student loans. Her and her partner were working to save money for a house of their own. But a rent payment of $4,000 a month made that impossible.
“When I’m maxed out on rent, I have no money left to put into the local economy and support my neighbors’ businesses,” she said.
So they moved out of town and lived in three houses in six months last year.
“We felt like the town housing program was just out of control and we had to leave,” she says. “There are a lot of wealthy people here in this town and there are also a lot of people who come from nothing and have built a life working really hard. It seems like town council and the housing committee don’t have enough respect for that.”
Andy Konigsmark and his family have been in a town-owned three-bedroom unit since July last year and he’s paying below market rate. The former senior minister of a local church now works as a waiter. The theologian wrote his doctoral thesis exploring church, community and fellowship in a “post-Christian culture.”
Konigsmark also attends council meetings, expressing some concern that the requirements for housing are pushing people out of town. He has suggested that the town enlist an independent third-party group to qualify applicants and leave the town to simply manage and maintain its properties.
“No one is forcing us to live here” he said. “Housing is just as frustrating as it is in other ski towns.”
Still, he said, “I’d rather struggle and live here than struggle and wish I was living here, you know.”