Affordable Housing in Ouray?

Affordable Housing on the Wane in Ouray County
by Kate Kellogg1 day 11 hrs ago | 83 views | 0 | 0 | | RIDGWAY – A new analysis of Ouray County’s housing needs, packed with facts and figures, provides the hard evidence of a growing dearth of affordable housing in Ouray County.

Consultants from Denver and San Miguel County presented their Ouray County Housing Needs Assessment to the public on Wednesday, April 16 at the Ridgway Community Center. In view of trends in wages and home prices, the assessment predicts that by 2015, 30 percent of new employee households in the county will need some form of affordable housing.

Nearly half of the 650 Ouray County households who responded to a survey on housing needs ranked affordable housing as one of the most serious problems facing the county.

The assessment was commissioned by the newly formed county-wide Affordable Housing Authority, an independent entity created to help locate, finance, build, and administer affordable housing in Ouray County. The authority is comprised of representatives from the county, City of Ouray and Town of Ridgway. Funded by a grant from the Colorado Department of Local Affairs, the housing needs assessment is the work of two consulting firms: the San Miguel County-based Affordable Housing Solutions and the Denver office of Economic & Planning Systems, Inc.

“One purpose of the assessment was to find out what residents want and need and to target appropriate housing prices,” said Affordable Housing Solutions’ Dawn Ibis.

The report highlights the growing disparity between income and housing prices. While real wages earned in the county have increased by 2.1 percent annually since 2000 (exceeding the rate of increase for the state), the increase in median value of Ouray County homes has risen 11.6 annually since 2003. The median price of a single-family home in Ouray County in 2006 was $395,000 and in 2007, $431,500. The average sale price for a condo or townhouse was $310,000 in 2007.

In 2006, the county’s area median income was $51,250 for a 2.5-person household. Not surprisingly, 26 percent of all renters and 33 percent of homeowners in the county are what the report calls “cost burdened,” meaning they spend over 30 percent of their incomes on housing. Moreover, 40 percent of all county households meet the Department of Housing and Urban Development’s definition of low income, as they earn 80 percent or less of the county’s median income.

Andy Knudtsen, of Economic & Planning Systems, attempted to “put a human face” on such affordability measures. He cited the report’s example of a household comprised of a teacher earning the average 2006 wage of $25,832 and a retail trade worker earning the 2006 average wage of $20,088. Combining their incomes, an affordable house would be priced at $157,400, far below the average available market unit from 2006.

That hypothetical household is earning about 90 percent of the area median income. Those 40 percent of the county’s population who earn 80 percent of the median could only afford a $140,000 home or a $1,000 per month rental unit.

One group that is apparently finding adequate housing is second home owners. While total housing units in Ouray County increased by an average of 112 per year from 2000-2006, the number of resident households increased by about 42 per year. Thus, 70 new housing units per year were either vacant or occupied by part-time residents.

A survey of employers in the county found that about 33 percent of Ouray workers and 75 percent of employees who work in Ridgway commute from other locations, both within and outside Ouray County. The 21 employers who responded attributed a number of employee losses to housing problems. About 25 percent of the employer respondents offer some form of housing assistance to their employees.

To prevent further shrinkage of the employee pool, essential workers should receive priority ranking as candidates for affordable housing, the study recommends. “Teachers, tellers and cops” broadly describes the cross-section of key service providers who may not be able to find affordable housing in the county, noted Knudtsen.

According to the study, the county’s current housing deficit is 165 units, a figure derived by adding the number of unfilled jobs countywide to half of the county’s in-commuters (assuming some employees commute for reasons other than housing costs). Based on employment projections, that deficit could grow to 881 by 2015.

A review of master-planned development projects highlighted the six affordable units planned for the Silvershield development in Ouray and 10 affordably priced units in Ridgway’s Parkside and Preserve developments. According to the assessment, none of the prices for any of these units will be below $220,000, or affordable for households earning less than 100 percent of the median income.

“All of these projects were initiated by developers,” said Ibis. “To achieve lower costs, such projects must be subsidized with state or federal grants.” She said the new affordable housing authority may eventually identify funding sources that will help fill the gaps.

The housing study recommends that Ridgway create a standard zoning requirement that developers set aside a portion of new units as affordable housing. Accordingly, the town should provide incentives to developers such as permit fee waivers, tap fee deferrals and density increases. It suggests that the city of Ouray could capitalize on its tourism economy by designating a fraction of sales or accommodations tax for affordable housing. Ibis noted that Telluride reserves .5 percent of its sales tax for that purpose. Since developable land in Ouray is limited, the city might provide incentives to include affordable housing in redevelopment sites.

Recognizing that the county and municipalities are protective of environmentally sensitive areas, the assessment recommends targeting areas of lesser growth, such as the Colona area, for affordable housing. The county might also use this approach for lands that immediately abut Ridgway and Ouray.

David Schwartz of Economic Planning & Systems commended the countywide attempts to address the area’s critical housing needs. “It’s great to see this collective community effort,” he said. “The challenge is to develop clear and consistent standards and generate public support for administration of future programs.”