A number of Colorado towns and cities are asking for voters’ help to solve their lack of affordable housing

October 29, 2021
CRESTED-BUTTE0-FALL-201024CRESTED-BUTTE0-FALL-201024Hart Van Denburg/CPR News
Crested Butte on the Western Slope, Saturday, Oct. 24, 2020.

There is a lack of affordable housing from the Front Range to the Western Slope. As Colorado’s population has boomed over the past decade, so has the cost of renting or buying homes. In the Denver metro region — the state’s most populous — the median home price has more than doubled in the past 10 years.

The housing shortage is being met with increased urgency in the state’s resort communities as a surge in the number of short-term rentals exacerbates the problem. Critics argue that people buying homes in popular vacation destinations to rent them out on websites like Airbnb are gobbling up limited housing supply and making it impossible for workers to live there. 

Soon, some Colorado voters will be asked to decide on how to address the problem. Mountain towns across the state have initiatives stemming from the housing shortage on the ballot next month, with several weighing new taxes to ease the burden.

The tension in these towns has been building for several years. The tipping point could be the pandemic, which drew a rush of city dwellers fleeing to the country — and, sometimes, staying there, further pushing up prices and draining accommodations for locals. 

Some municipalities, including Crested Butte, Steamboat, Breckenridge and Aspen, have already started to rein in short-term rentals in the form of caps or permit requirements.

Not everybody agrees that limiting short-term rentals is what’s best for mountain towns. Tourism is the primary economic driver in a lot of Colorado’s resort communities, and short-term rentals are a big draw for visitors.

Heidi Nenandal is a leading proponent of a citizen-led ballot measure in Telluride that would limit the number of short-term rental licenses to 400, with some exceptions. That’s about half the number currently outstanding, according to Nenandal. Nenadnal, who works in the film business, acknowledges the town’s reliance on tourist spending.

“Every sector depends on tourism in Telluride — we’re saying it’s just not sustainable, the level it’s at,” Nenandal said. 

The cap would create a better balance between how many visitors are in town, and how much housing there is for the workforce, she said. A separate initiative would cap the number of licenses at the number issued as of Nov. 2. Also on the ballot on Telluride is a lodging tax that could go toward building affordable housing, among other things. 

Some of the measures, according to the Colorado Municipal League:

Avon – Excise tax on short-term rental units to fund community housing 

Basalt – $18 million in debt authority to fund affordable housing, infrastructure improvements and green projects, to be paid for with the extension of previously approved property taxes 

Crested Butte – $8.985 million in debt authority, to be paid for with an increase of the excise tax on vacation rentals; and a separate question for $24 million in debt authority, to be paid for with two taxes: a sales and use tax and a Community Housing tax on undeveloped residential land and on residential units that are not a primary residence and are not being rented for residential purposes for at least six consecutive months per year 

Lafayette – Sales tax to be used for mental health and human services, which may include rent assistance, as well as assistance with food, utilities, childcare, and medical care, mental health care and resources and support for victims of domestic violence 

Leadville – Accommodations tax on the leasing of short-term rental units and short-term commercial public accommodations to fund affordable and community housing programs 

Ouray – Excise tax on the leasing of short-term rentals to fund housing programs, as well as to fund debt for the water and wastewater treatment plants 

Vail – Sales tax to fund housing initiatives, developments and programs 

Telluride — The ballot has three housing-related questions: Lodging tax to manage the effects of tourism on the community, including the acquisition of property for and construction of affordable or employee housing, as well as transportation improvements and wastewater treatment facility improvements; an increase to the business license fees for short-term rental units and a cap on the number of licenses to the number that have been issued as of Nov. 2, 2021; an initiative to cap the number of short-term rental business licenses available for non-primary residences to 400.

Boulder — Voters will consider an initiative to increase the number of people allowed to reside in housing units. 

Denver — The ballot will include a referendum on an ordinance concerning the number of unrelated adults who can live in a household, which would strike down an increase in permitted housing residency by unrelated adults in Denver should the referendum pass. The ordinance also concerns residential care facilities and community corrections facilities.

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