DENVER — A perfect storm of rising construction costs, gentrification, stagnant wage growth — all made worse by last year’s devastating floods — is causing an acute affordable housing crisis across Colorado, according to Democratic lawmakers promising to do something about it.
“Folks who work in the oil fields in Weld County are having a difficult time finding a place to live,” said Sen. Jessie Ulibarri, D-Adams County, at a press conference Wednesday morning at the Capitol.
“We’ve heard from folks in the mountain communities, who work at ski resorts, about finding an affordable place to live. This is something that affects every single corner of our state.”
On Wednesday afternoon, their proposal, House Bill 1017, took its first step forward, clearing the House Local Government Committee on a 7-4 vote.
The proposal, which carries a $4.5 million price tag and still must be approved by appropriations committee and lawmakers in both chambers, would fund the construction of up to 800 new units of affordable housing by the end of the year.
Through the Housing Investment Trust Fund, the legislation would expand the number of qualified developers that can receive loans or loan guarantee from the state.
“This fund will allow us to access and utilize other funding sources that we really can’t utilize right now,” said Troy Gladwell, a private developer with Medici Communities who says that it’s become almost impossible to build affordable housing units.
“We cannot afford to build apartments for people who make $10 an hour, because we’re agreeing to rent for $650 or $700 a month for the next 40 years instead of $14-1800 a month. That’s not enough to cover our construction costs.”
Additionally, the legislation tweaks the Housing Development Grant Fund, allowing up to 20 percent of the fund to be used for non-construction activities such as temporary housing, foreclosure prevention and home ownership assistance.
It will also eliminate a requirement for borrowers to get a replacement loan within 180 days, which will allow greater flexibility to fund the most-needed projects across the state.
“Ultimately this is about making sure lower-income families across Colorado have an affordable place to live,” said Rep. Crisanta Duran, D-Denver, the bill’s prime House sponsor.
“This bill will increase access to capital for developers, who will get more of these projects started.”
H.B. 1017 now moves to the House Finance Committee.
Lawmakers say it’s the perfect time to invest in affordable housing, with the shortage exacerbated by last year’s catastrophic floods that displaced thousands of residents after their homes were damaged or destroyed and an improving economy enabling new investments by the state.
“The modest investments can leverage an eight-to-one impact,” Ulibarri said. “We invest one dollar as a state and eight dollars come in from the private sector.”