ROARING FORK HOUSING AUTHORITY INITIATIVE DECISION BRIEF # 1 TO: Steering Committee Members Roaring Fork Housing Authority Initiative FROM: Kathy McCormick, McCormick and Associates, Inc. – 970-499-1915 Colin Laird, Healthy Mountain Communities – 963-5502 DATE: 7/6/2002 RE: Steering Committee Meeting Thursday, July 11 Steering Committee Meeting, 2:00 – 5:00 pm, Glenwood Springs Community Center This memo contains information relating to the July 11 Roaring Fork Housing Authority Steering Committee meeting. It is designed to accomplish the following: 1. Provide a brief review of previous and on-going discussions on forming a regional housing entity in the Roaring Fork Region; 2. Summarize information on the Regional Housing Authority Law and describe the basic functions and abilities of a Regional Housing Authority; 3. Examine and share recommendations on issues relating to a Roaring Fork Housing Authority. For the purpose of the July 11 meeting, this memo contains information on the following decision areas: ? Purpose of the Authority; ? Relationship to other existing organizations; ? Possible boundaries of a Regional Housing Authority; ? Possible governing structure of such an Authority; 4. Set the context for subsequent discussions on staffing and financing a Regional Housing Authority. BACKGROUND – REGIONAL AFFORDABLE HOUSING INITIATIVE The effort to create a Roaring Fork Housing Authority had its start through the Regional Affordable Housing Initiative. This effort, which took place in 1999, was funded by local governments and the Department of Local Affairs and coordinated by Healthy Mountain Communities. The initiative provided some tools (e.g., legal analysis, model policies, regional administrative framework) for local jurisdictions in the Basalt to Glenwood Springs area of the Roaring Fork Valley to augment and continue development of their affordable housing programs. Local governments, such as the Town of Carbondale and the City of Glenwood Springs adopted inclusionary zoning ordinances as a result of the work of the Regional Affordable Housing Initiative (The Town of Basalt and Garfield County adopted their affordable housing policies in 1999). A summary of affordable housing policies in the Lower Roaring Fork Valley is in Table 1. Table 1: Affordable Housing Policies Jurisdiction Inclusionary Zoning Commercial Linkage Residential Linkage Town of Basalt 20% 20% Town of Carbondale 15% City of Glenwood Springs 15% Garfield County 10% Eagle County Under consideration Under consideration Under consideration Note: Pitkin County, City of Aspen, and Town of Snowmass Village all have Inclusionary zoning and commercial linkage requirements of 60%. Given the regional nature of the lack of affordable housing and the similar administrative needs, citizen task force members for Regional Affordable Housing Initiative discussed how a regional administrative entity could benefit local affordable housing efforts. Some of the functions that were considered for a regional entity include: ? Monitoring community housing needs; ? Facilitating the sale and/or rental of units; and, ? Providing information to the community about affordable housing supply, demand and pending projects. The citizen task force also discussed possible organizational structures for such a regional entity and debated the merits of three options: ? Contracting with an existing nonprofit organization ? Contracting with the Garfield County Housing Authority ? Starting a new regional organization The citizen task force recommended combining the last two options: contracting with the Garfield County Housing Authority and starting a new regional housing entity (with an elected official board of directors) as the best way to ensure support from all the participating local governments and still take advantage of the housing expertise at the Garfield County Housing Authority. Since the completion of the Regional Affordable Housing Initiative, Garfield County (and recently Glenwood Springs) has contracted with Garfield County Housing Authority to provide administrative support, including verification of income, recording deed restrictions and monitoring sales for their inclusionary zoning program. The Garfield County Housing Authority has managed the administration of eight units of deed-restricted affordable housing under this agreement. As for the other local governments, Basalt currently administers its inclusionary zoning / commercial linkage program internally and the Carbondale is still considering the best way to administer their program. Consequently, the new state regional housing authority law offers the communities of the Roaring Fork Valley a tool to create a regional affordable housing entity similar to the one recommended as part of the Regional Affordable Housing Initiative. REGIONAL HOUSING AUTHORITY LEGISLATION SUMMARY In 2001, the State of Colorado enacted legislation that allows for multi-jurisdictional housing authorities. The law allows any combination of home rule or statutory cities, towns, counties and of the state, through a contract with each other, to establish a separate governmental entity known as a "multi-jurisdictional housing authority". These authorities may be used by the contracting member governments to affect the planning, financing, acquisition, construction, reconstruction or repair, maintenance, management and operation of housing projects or programs with a multi- jurisdictional plan. The powers of a multi-jurisdictional or regional housing authority appear to be quite broad and the following functions and duties of an authority do not constitute a complete list. The number and types of functions an authority may undertake will depend upon the contractual agreements among the participating jurisdictions, the direction of the Housing Authority board and the capacity of the authority to undertake the work. Some of the functions of an authority may include: 1. Providing homeownership and rental assistance programs; 2. Provide information for community-based programs, including maintaining information on housing inventory and housing needs; 3. Administer Section 8 Rent Subsidy Programs, and if qualified, CDBG and HOME Programs; 4. Plan and finance the acquisition, construction, reconstruction and operation of housing projects or programs for low to moderate-income families. These authorities may incur debt, issue bonds and generate revenues; and, 5. Administer programs of the jurisdictions for the benefit of low to moderate-income households. One of the major advantages of using this legislation is that, unlike a County housing authority, a regional housing authority may levy taxes or development impact fees, if so stipulated in the agreement among the participating jurisdictions of the housing authority. The parameters for such revenue sources include: ? A sales or use tax or both, not to exceed one percent; ? A property tax not to exceed five mills ? A development impact fee of two dollars per square foot or less. All proposed tax measures must be submitted to the voters. Although it appears that development impact fees would not be subject to a direct vote, such fees can only be used by the Authority if it also implements and sales and/or use tax. Affordable housing is exempt from paying these fees. Fees and/or taxes may be used to accomplish the above-mentioned functions, as well as to: ? Make and enter into contracts with others involved in providing housing projects or programs; ? Employ agents and employees; ? Cooperate with state and federal governments in financing housing projects and programs; ? Acquire, hold, lease, sell or otherwise dispose of real or personal property; and, ? Condemn property for public use. (See the copy of the legislation, State Statute 29-1-204.5 – Establishment of multi-jurisdictional housing authorities attached to this memo.) DECISION AREAS, OPTIONS & RECOMMENDATIONS As outlined in the initial memo to each participating government in the Lower Roaring Fork Valley, the steering committee will work its way through a decision-making framework of questions to create a draft intergovernmental agreement for consideration by each participating local government. (See attached Intergovernmental Agreement Decision-making Framework). This section of the memo follows the Intergovernmental Decision-making Framework by offering analysis related to the purpose of the authority and its relationship to existing organizations, possible authority boundaries, and a possible governance structure for the authority. Discussion and decisions in these areas by the steering committee will guide further analysis on the staffing and financing options for the regional housing authority. All recommendations in this memo are for the purpose of discussion. PURPOSE OF THE AUTHORITY Background Under the state enabling legislation, a regional housing authority is able to undertake many tasks, including the administration of programs including home ownership assistance, rehabilitation programs directed to low and moderate income households and entering into agreements with other entities to create housing and/or programs for the benefit of low to moderate income households. An Authority may also develop, own and manage units for sale or rent. The primary guiding principal is that these efforts are undertaken to further housing opportunities for low to moderate-income households within the jurisdiction of the authority. In creating a regional housing authority for the lower Roaring Fork Valley, it is hoped that this entity will support and enhance the efforts of other groups and governmental entities that are creating affordable housing in the area. Options 1: Administrative functions only. A regional housing authority could oversee a program to assure that units produced by different jurisdictions are sold/leased to income-qualified households. 2: Administrative, research, and policy development. In addition to Option #1, the regional housing authority would conduct regular research on housing need, investigate revenue generating options that would be made available to area non-profits and private developers that build or acquire housing that is affordable low to moderate income households, and work with local governments on a range of policy options to support affordable housing. 3: Options 1 & 2 plus, the full range of functions as outlined in the enabling legislation. Recommendation Option # 3: Options 1 & 2 plus, the full range of functions as outlined in the enabling legislation. There are a number of reasons why is makes sense to pursue Option #3 and create a regional housing authority that can provide administrative, research, and policy development tasks as well as perform all of the functions outlined in the state enabling legislation. They include: ? Given the dynamic nature of the affordable housing issue, it would seem reasonable to create a regional organization that takes full advantage of the enabling legislation rather than limit the organization to a few tasks. This approach also gives the Authority board of directors and local governments the power to determine the range of policies projects, and programs it undertakes as the organization develops. Entering into such an agreement does not mean that the Authority has to use all its abilities, but it does avoid having to amend the original intergovernmental agreement, which can be a time consuming process. ? The administrative function of the Authority is an obvious need, given the size of the communities and potential number of units. It is also easier for buyers and renters to contact one entity to learn about the availability of housing that is affordable to them. Applicants could potentially only have to go through one application process. The programs from each community may be different, but the housing authority will have the responsibility of assuring that persons who buy or rent an affordable housing unit meet the requirements adopted by the different jurisdictions. ? Since there is no ongoing research on housing need in the Lower Roaring Fork Valley, creating the Authority with this purpose in mind will have a significant contribution to the local understanding of the affordable housing issue. The research function will also relieve the current burden on existing planning staff and provide the basis for ongoing affordable housing policy development. ? In addition to research related services, a regional housing authority could also provide consultation to local governments on local affordable housing policy development. Given the amount of time and effort involved in policy analysis and development, including this element in the purpose of the regional housing authority provides another important economy of scale for local governments. . ? A regional housing authority has the ability to generate revenue to offset its operational expenses and take pressure of local government general funds. Furthermore, a regional housing authority could propose a tax or impact fee and use the proceeds of these fees to facilitate affordable housing development and/or acquisition in the area. This could be done with other non-profits, for profit developers or by the authority. A housing authority can also issue debt in order to finance its projects without a vote. This is an advantage over local governments that may want a particularly project built, but are precluded from doing so because of TABOR requirements. Consequently, this element should be included in the purpose of the regional housing authority. RELATIONSHIP TO EXISITNG ORGANIZATIONS Background In addition to local governments, there are several existing organizations working to produce and promote more affordable housing in the lower Roaring Fork Valley. They include: Organization Focus Mountain Regional Housing Corporation (formerly the Carbondale Affordable Housing Corporation) The Mountain Regional Housing Corporation is Community Housing Development Organization (CHDO) pursuing acquisition and development opportunities for low to moderate-income households in the area. This includes rental and for-sale housing. This group is also administering the deed restricted affordable housing developed as part of Thompson's Corner in River Valley Ranch in Carbondale. MRHC's board is made up of citizen representatives from the area. Carbondale Housing Authority Manages a senior housing project in Carbondale. The Carbondale Board of Trustees appoints the Commissioners for the Carbondale Housing Authority. Garfield County Housing Authority The Garfield County Housing Authority is a local housing authority that is authorized to provide services and programs that are comparable to those that are allowed in the enabling legislation for regional housing authorities. In the past, it has focused primarily on senior housing and administration of the Section 8 Rent Subsidy Program. Recently, Garfield County and the City of Glenwood Springs have entered into an agreement with the housing authority to oversee the sales of affordable housing units that are produced through their respective inclusionary zoning programs. The Commissioners for the Garfield County Housing Authority are appointed by the Garfield County Commissioners. Potentially, a regional housing authority could duplicate the efforts of all of these organizations, depending upon the types of policies, programs and services established for the authority. Conversely, a regional housing authority could support and enhance their efforts through additional resources, research, and partnerships. For example, if the authority actively pursued development and/or acquisition of affordable housing it could compete with the Mountain Regional Housing Corporation. On the other hand, these two organizations could partner on projects to better leverage resources and reduce risk. For example, the Housing Authority could acquire land and enter into an agreement with the MRHC to develop the site. Because authorities are exempt from paying property taxes, less cost would be incurred during the period of time that a project was pursuing development approvals. A regional housing authority could compete with both the Carbondale and Garfield Housing on senior housing (although these two organizations seem to have functioned well for a number of years despite operating in the same county). On the other hand, a regional housing authority could potentially provide local resources for senior housing not currently available to either organization. A regional housing authority would not duplicate the Section 8 Rent Subsidy program administered by the Garfield County Housing Authority, since new authorities have difficulty receiving new Section 8 Vouchers. A new authority could compete with the Garfield County Housing Authority for the inclusionary zoning program oversight or it could contract with the authority with resources beyond local government general funds to provide these services. Options 1: Maintain the current status (no regional housing authority) - each unit of local government could contract with the Garfield County Housing Authority to administer their respective programs. Each agreement would spell out the duties to be performed by the Housing Authority and the method(s) of compensation. This option would focus solely on program administration. 2. Reorganize the Garfield County Housing Authority into a regional housing authority with a new board of directors. The regional housing authority would assume the current tasks and obligations of the Garfield County Housing Authority and add the full range of powers outlined in the enabling legislation. 3. Establish a regional housing authority. As part of its function, the housing authority would provide administrative oversight of the different local housing initiatives. The regional housing authority could enter into an agreement with the Garfield County Housing Authority to provide staff support for program administration. 4. Establish a regional housing authority with its own staff and board. Under this option, the staff of the authority would administer programs and pursue other activities that have been delineated in the contract with the different local governments. 5. Set up a regional housing authority and enter into an agreement with Garfield County Housing Authority to provide administrative services related to the inclusionary zoning and commercial linkage programs. The regional authority would also hire staff to administer this contract and to pursue other areas of interest, including generating revenues to support program operations and housing research, and policy analysis and development. Recommendation Option #5: Set up a regional housing authority with a new board and staff and enter into an agreement with Garfield County Housing Authority for administrative services. There are a number of reasons why is makes sense to pursue Option #5 and create a regional housing authority with a new board and staff and enter into an agreement with Garfield County Housing Authority for administrative services. They include: ? Reorganizing the Garfield County Housing Authority may not build the trust and buy-in from local governments necessary to share and fund administrative services for affordable housing. Such a reorganization could also lessen the current commitment to Section 8 and senior housing in the western part of the county since the new regional housing authority will have significant work in the eastern/Roaring Fork Valley end of Garfield County as well as western Eagle County. A new regional housing authority will be able to completely focus on the significant affordable housing needs of the Roaring Fork Valley. ? A regional housing authority is able to pursue a variety of initiatives, including new development, generating revenues, and related programs and services. Evaluating the different policies, program initiatives, possible services, potential partnerships and revenue sources will take a lot of effort on the part of the board. A staff person that is devoted to this effort can provided needed support and reduce the amount of time commitment needed from board members to accomplish the same tasks. ? A staff person can represent the policies and programs of the regional housing authority to other entities and persons. This will establish an identity for the regional housing authority and greater understanding of its purpose and role in facilitating affordable housing efforts in the Lower Roaring Fork Valley. ? Although there is an initial cost of hiring a staff person, this person will be able to focus on implementing the business plan for the organization that will include possible resources to provide on-going funding and revenue to support the agency. This approach would bring funding (beyond local government general funds) to the organization more quickly than if this effort is left entirely to board members. ? Currently, Garfield County Housing Authority is administering the programs for Garfield County and the City of Glenwood Springs. Since they are gaining experience in administering these programs, continuing to utilize their services allows the regional housing authority to focus its time and energy on efforts relating to funding, partnerships, research, and policy development. ? This option is further supported by the analysis and recommendation on the boundaries of the regional housing authority in the next section. BOUNDARIES Background The regional housing authority legislation provides that: "The boundaries of the authority, which boundaries may include less than the area of the separate governmental entities and which may be modified after the establishment of the authority as provided in the contract." This means that a governmental entity, such as a county, may identify a portion of the county that will be served by the regional housing authority; the entire area of the county does not have to be within the jurisdiction of the housing authority. Furthermore, the boundaries can be expanded to include the rest of a county by amending the intergovernmental agreement. Options 1: All of Eagle, Garfield, and Pitkin Counties. 2: All of Eagle and Garfield Counties. 3: The RE-1 school district in the Roaring Fork Valley, which is equivalent to the area between Basalt and Glenwood Springs. Recommendation Option #3: The RE-1 school district in the Roaring Fork Valley, which is equivalent to the area between Basalt and Glenwood Springs There are a number of reasons why Option #3 best fits the initial creation of a regional housing authority in the Roaring Fork region. They include: ? Including Pitkin County does not make sense since the Pitkin County has its own housing authority with a dedicated funding source (a real estate transfer tax) and already administers an extensive housing program with several hundred deed restricted units. ? Garfield County's inclusionary zoning requirements do not apply to the entire county. They apply only to Study Area 1, which includes the Roaring Fork Valley from Glenwood Springs to the Eagle County line. Furthermore, while municipalities in the Roaring Fork Valley portion of the county have adopted their own inclusionary zoning requirements, municipalities in the Colorado River Valley/I-70 corridor have not. ? The RE-1 School District boundary coincides with the local governments in the Roaring Fork Valley that have adopted affordable housing policies, have a interest in administrative cost savings for affordable housing programs, and currently have no funding source for affordable housing beyond their general fund. Although there is some overlap between this boundary and the areas served by the Garfield County Housing Authority, the housing authority has tended to focus in western Garfield County (largely due to greater supply of affordable rental units). GOVERNANCE Background The enabling legislation states that the establishment and organization of a governing body shall be established "in which all legislative power of the authority is vested". With regard to naming a governing body, the legislation stipulates that the contract establishing the authority specify the number of directors, their manner of appointment, terms of office, compensation (if any) and procedure for filling vacancies. It also stipulates that the officers of the authority be identified, as well as the process to select the officers and their duties. Some issues to be considered in additional to board membership include assuring an odd number of members (or votes) to avoid split decisions, to provide a rotation among the first board so that all of the initial board members terms do not all expired at the same time, and to stipulate if board decisions need more than a simple majority. Options 1. Membership to the Roaring Fork Housing Authority Board of Directors is a publicly elected position. 2. Elected boards from each participating jurisdiction appoint a citizen representative to serve on the Roaring Fork Housing Authority Board of Directors. 3. Elected boards from each participating jurisdiction appoint an elected official representative citizen to serve on the Roaring Fork Housing Authority Board of Directors. 4. Elected boards from each participating jurisdiction appoint an elected official representative and an elected official alternate to serve on the Roaring Fork Housing Authority Board of Directors. Recommendation There are a number of reasons why Option #4 works best for the initial creation of a regional housing authority in the Roaring Fork region. They include: ? Making the board of directors of a regional housing authority a publicly elected position is attractive from standpoint of supporting direct democracy. However, a key role of a regional housing authority is to promote communication and cooperation between local governments on the issue of affordable housing. A directly elected board guarantees neither. Furthermore, it sets up a potentially adversarial role between municipal and county elected officials and elected housing board members. ? Although appointed citizen boards are important components of local government, there are too many critical policy and funding decisions relating to the development of a regional housing authority to rely on an appointed citizen board. Since the regional housing authority board will ultimately make funding decisions to support local affordable housing efforts and could potentially ask funding questions of local residents within the authority boundaries, such a board should be made up of elected officials from each member local government. Furthermore, local elected officials serving on a regional housing authority board better ensures that the authority meets the needs of each local government in ways a citizen representative cannot. ? The newly formed Roaring Fork Transportation Authority (RFTA) has successfully adopted the elected official representative and an elected official alternate approach to board membership. Given the busy schedules of local elected officials, this approach ensures that at least one representative from each local government within the regional housing authority can attend meetings throughout the year. This approach also increases the likelihood that board meetings will have a quorum and healthy number of board members to discuss issues. Finally, this approach also offers greater lines of communication between a regional organization and local governments. To avoid any confusion over decision- making, each local government will have only one vote on the board. PAGE 11 OF 11 1 ROARING FORK HOUSING AUTHORITY INITIATIVE HEALTHY MOUNTAIN COMMUNITIES