COMMENTARY: What's the future for affordable housing in Lyons?
By Amy Reinholds
Although not on the agenda for this week’s Lyons Board of Trustees meeting, there are a few updates about affordable housing in Lyons.
Summit Housing Group, which was assigned the purchase and sale agreement to purchase Lyons Valley Park, Filing 8, Tract A from Keith Bell earlier this month, is completing due diligence tasks, including appraisals and geotechnical engineering assessments. Town Administrator Victoria Simonsen said that Summit will have to make a decision within a week on whether to move forward with the proposal for forty-three affordable rental homes.
May 1 is the deadline for a letter of intent for applying for the higher level of federal tax-credit financing.
The federal Low Income Housing Tax Credit (LIHTC) program is a source of funding that helps developers build rental homes at lower cost. The higher subsidy of tax credits to cover seventy percent of the costs of affordable units in a project (also referred to as “nine percent tax credits”) has a final application deadline of June 1.
The LIHTC gives investors a reduction in their federal tax liability for every dollar they invest in financing to develop affordable rental housing. The investors’ equity contribution subsidizes the development, allowing housing units to rent at below-market rates. For details about LIHTC, see chfainfo.com/arh/lihtc/overview.
If Summit does not get the higher “nine percent tax credits” financing option, then the lower “four percent tax credits” are available with a longer, more flexible timeline.
The so-called “four percent tax credits” program has more flexible deadlines, and more options to apply, but it only covers thirty percent of the costs of affordable rentals in a development, and the affordable housing developers must find other sources of funding to make the project work.
The next step for Summit is a development plan that goes through the process with the Lyons Planning and Community Development Commission (PCDC), which includes public input. The architect from Summit also plans community outreach activities.
Lyons Valley Village, a co-housing community, is an example of existing multifamily buildings in Lyons Valley Park that are compatible with the surrounding neighborhood. According to research from Town of Lyons staff and attorneys reported at the April 2 Board of Trustees meeting, Summit’s proposed development will follow the same process as Lyons Valley Village did in the early 2000s because the title commitment for both Lyons Valley Village and Filing 8, Tract A explicitly says “subject to PRD,” which was used from 1969 to 1979 to allow multi-family housing, aligning with today’s PUD zoning. The consulting attorneys for the town reviewed the documentation and say it stands, which means that the Filing 8, Tract A does not require rezoning, can follow the same process that Lyons Valley Village followed. If Summit decides to move forward after all due diligence steps, the next step is a development plan with the PCDC.
Summit Housing Group won a request for proposals process last month, after a selection committee, including representatives from the PCDC and the Lyons Valley Park homeowners association, brought forward two finalists. Summit, based in Missoula, Montana, is a development company that specializes in low-income tax credit and mixed-use developments. It develops and manages rental properties in six states, including Montana, Wyoming, Utah, and Colorado, all which include portions affordable to people who make sixty percent of the area median incomes or less. Their latest homes in Colorado are at 1205 Pace St. in Longmont.
The proposal for Lyons includes a total of forty-three rental homes (one is for the on-site property manager) in twelve buildings that are two stories. The buildings include twenty-four two-bedroom/two-bath, 1200 sq. ft. homes and nineteen three-bedroom/two-bath, 1500 sq. ft. homes. In contrast to the twelve buildings proposed by Summit, about twenty-five large, market-rate, single-family homes could be built on the same land, according to Clay Dusel, a Lyons Valley Park resident and a PCDC commissioner, who spoke at a March 12 meeting.
If Summit can meet the June 1 deadline for a higher subsidy of federal tax credits for investors, more of the forty-two rentals could be set aside for households who earn thirty to fifty percent of the area median income. A presentation from Rusty Snow of Summit to the trustees at a March 12 meeting showed that thirty percent of the area median income means a range of $20,640 to $31,830 annual income for a one- to five-person household, and the range of affordable monthly rents for that income, based on household size, starts at $552 to $766. And fifty percent of the area median income means a range of $34,400 to $53,050 annual income for a one- to five-person household, and the range of affordable monthly rents for that income, based on household size, starts at $921 to $1276.
If Summit can only get the lower level of tax credits, most of the rentals would be for households that earn fifty to sixty percent of the area median income. The rentals could be intended for households that earn as much as sixty percent of the area median income, which means a range of $41,280 to $63,660 annual income for a one- to five-person household. The range of affordable monthly rents for that income, based on household size, starts at $1033 to $1532.
In the past two years, the Lyons Board of Trustees has been trying to find land for affordable housing, to not lose four million dollars in federal Community Development Block Grant-Disaster Recovery (CDBG-DR) funds set aside for Lyons. Other federal funds were lost in 2015 when a proposal for using part of Bohn Park to build subsidized, affordable Boulder County Housing Authority rentals and some Habitat for Humanity for-sale affordable homes (a total of fifty to seventy units) was rejected in a town vote: 498 Lyons voters supported it, and 614 Lyons voters opposed it. However, with four million dollars still reserved for Lyons in the years that followed, the trustees have been pursuing several smaller options for housing.
Another possible purchase of land for affordable housing in Lyons is 19617 North St. Vrain Drive, 2.13 acres in Boulder County next to the Baseline-Mocon industrial parcel and near the Eagle Canyon subdivision. Simonsen said this week that the sales agreement is still active, pending further assessment.
There are currently twenty-six permanently affordable rental homes in the Town of Lyons (already in town before the September 2013 flood): eight apartments at Bloomfield Place near the Stone Cup cafe, twelve apartments at Walter Self Senior Housing near the post office, and six apartments at Mountain Gate on Second Avenue, all operated by the Boulder County Housing Authority. The only post-flood affordable housing currently being built is at Second Avenue and Park Street where Habitat for Humanity of the St. Vrain Valley is building three duplexes (a total of six homes) on land the non-profit purchased at the end of 2016. To volunteer, sign up at www.stvrainhabitat.org/construction.
The Town of Lyons lost about seventy-six to ninety-four flood-destroyed homes. To get an accurate number of housing stock lost in the September 2013 flood, there are two ways to count. First, according to counts of Town of Lyons water taps/customer accounts, ninety-four customer accounts were lost after the flood (taking into account the thirty-two homes in Riverbend Mobile Home Park that were originally part of one water tap). However, some of those customer accounts were on Apple Valley Road (not in town limits), and some lots in town have more than one water tap/customer account. A second way to count is the number of flood-damaged homes in the Town of Lyons lost to both the federal buyout programs and to the changed use of the Riverbend Mobile Home Park property to an event venue (rezoned for commercial use), which totals seventy-six lost residential units. Federal buyouts totaled forty-four units, including all residential units in the Foothills Mobile Home Park, and there were also thirty-two families who lost homes in the Riverbend Mobile Home Park, which was rezoned as a commercial wedding and lodging venue after the flood.