A Denver City Council committee Wednesday moved forward with a plan to create the city’s first dedicated affordable housing fund.
The proposal is aimed at building or preserving 6,000 affordable housing units over a decade through a combination of small property tax hikes and new fees on new developments. A small amount of first-year funding is expected to come from marijuana tax revenue.
Revised city estimates show the plan would generate more than $156 million over 10 years to provide affordable housing funding for a city that’s becoming increasingly unaffordable.
That’s an issue Maureen Welch knows well. She moved to Denver 20 years ago from San Francisco – a place well-known for its high cost of living.
“If you all don’t jump in and do something about affordable housing, you’re going to be in the same boat that San Francisco is in right now,” she told members of the council’s Safety, Housing, Education and Homelessness Committee. “They can’t find people to work in their hotels and their restaurants. They can’t find teachers.”
The plan would cost the average homeowner an extra $12 a year in taxes. But critics are worried the new fees would increase building costs.
“If we put a fee onto houses… and we spike the cost of building these houses, we’re in effect moving in a direction very much opposite of the one that we’d all like to see us move forward on,” said Mike Kopp, a former state lawmaker and president of Colorado Concern, which is made up of Colorado business executives.
And some on the council would like to explore more funding alternatives. A dueling funding proposal that may also end up being considered by the full council would provide more immediate funding through the city’s general fund.
But councilwoman Robin Kniech, who sponsored the proposal that passed committee Wednesday, says it would be would be a mistake to rely on fluctuating general fund dollars just because the budget is in good shape right now.
“This budget is not going to last through every downturn,” Kniech said. “If these sources are not in place, there will not be extra dollars for housing.”
The plan passed the committee with unanimous support. The proposal is expected to be heard by the full council on Sept. 12.