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HomeMy WebLinkAbout2023-08-22 VLHA Agenda 2 3 4 Vail Local Housing Authority Minutes Tuesday, August 8, 2023 3:00 PM Vail Town Council Chambers and on Zoom PRESENT ABSENT Steve Lindstrom Craig Denton James Wilkins Via Zoom Dan Godec Kristin Williams STAFF George Ruther, Housing Director Martha Anderson, Housing Coordinator Missy Johnson, Housing Coordinator 1. Call to Order 1. 1 Call to Order Meeting called to order at 3:02 p.m. with all members of the authority present. 1.2 Zoom Meeting 1 (Pre-Executive Session) 1.3 Zoom Meeting 2 (Post-Executive Session) 2. Citizen Participation 2.1 Citizen Participation no comments 3. Approval of Minutes 3.1 VLHA July 25, 2023 Minutes Presenter(s): Missy Johnson, Housing Coordinator Approve as Amended Note to change 2010 to 2001. on page 3 of the minutes MOTION: Williams SECOND: Denton PASSED: (5 - 0) 4. Main Agenda 4.1 Discussion of the Altus Vail Deed Restriction Presenter(s): Altus Vail Group, George Ruther, Housing Director George introduced the Altus Group to open discussion with the Housing Authority to work together regarding a solution as a recommending body. Chad Brue, the equity partner, with Brue Capital joined; He is also the owner of Frost Creek, understanding the need for employee housing. Pat Peeples, with Peeples Inc., joined as a representative as well. Rue described background about the Altus Vail project and the EHUs in particular. The main discussion ensued around which opportunities exist to collaborate as a group to come up with ideas or opportunities around Altus Vail and the EHUs. 5 Some time was spent looking back but mostly to look forward in steps moving forward. An example was used from the past regarding a similar scenario that was win-win for another local building owner and Town of Vail. In summary of the Altus project per Brue: 30 units total, 15 for sale and 15 Employee Housing Units (EHUs). Received certificate of occupancy November 1, 2021. Brue states that all units are occupied besides two that recently vacated. The developer did not realize the deed restrictions required 6-month leases. Topics included the following terms that the developer team did not realize: 6 month leases and Each unit cannot be vacant for more than 90 days. Because they were 16 months delayed, the motivation was to get it leased and sold and do everything to get them leased and sold. From day one, they were intended to be employee housing units, not affordable units. They (Brue) were notified that they were non-compliant when Pete was served. "Doing everything they can to lease the units." Two units sold, two units for sale. They are now considering other opportunities in addition to the residential sales of all 15 as they become vacant. Johnson confirmed the communication process associated with being non-compliant as directed to Pete Carlson and the Property management company in 2022 prior to being served. Discussions ensued urdles regarding the deed restriction regarding a qualified resident; which currently excludes an LLC or entity as an owner; maximum 6-month lease. Opportunities discussed include the following suggestions and reminders: Could there be a master lease, I.e. Vail Health or Steadman and they would lease to their employees; currently (deed restriction) does not allow that. Seeking solutions for a self-employed, work from home employees Continue to work with George and his team regarding the above items in effort to be in compliance moving forward; Alternatives include the following for discussion with interest from the Authority to come to an agreement for consideration: Exchange of deed restrictions for 3:1 ratio but at this stage, it does not seem feasible at this time Cut a check to buy-out the deed restrictions 750 units being built elsewhere in Eagle County; land is not owned yet but it is in Eagle so perhaps there is something there as a solution while considering that there are different investors involved The authority expressed their conclusion, that they want to work together regarding a solution and they look to Altus to present some options for the Authority to consider. Change the deed restriction to allow for longer than six months and/or other administrative tweaks Consider master leases I.e. Vail Health or Steadman Clinic Additional track opportunities for Ru to fulfill their requirement differently It is a mutual covenant with an opportunity to amend it as mutually agreed upon Locate Town of Vail homes available for purchase and place deed restrictions Homes west of Dowd Junction are a possibility Mixture of fee in lieu and other solutions and 3:1 ratio for deed restricted square footage Authority expressed interest avoiding a lawsuit regarding EHU compliance 6 4.2 Eagle County Bold Housing Moves Presenter(s): Kim Williams, Executive Director of Eagle County Housing and Development Authority Members of the Eagle County Housing Development Authority presented to the Authority regarding their Bold Housing Moves status and ongoing initiatives. Kim Bell Williams, executive Director of the Eagle County Housing Development Authority was joined by Patti Liermann, Housing Authority and the Valley Home Store and Matt Andrews with the Housing Authority and Outreach. The presentation focused on the variety of programs, strategic priorities and high level of reporting. The team reviewed a variety of the programs including: Serving the full spectrum of units, new program ideas for existing units, future housing projects, importance of diversity, and equity and inclusion. New Housing units such as Colorado Mountain College, Habitat for Humanity, Eagle County Schools, Haymeadow, Spring Creek Apartments, West Eagle and Fox Hollow were reviewed in terms of total units, investment and unit types. The team touch on the Homeless Services initiative as a reminder that this, too, exists in Eagle County and goals and funding was reviewed. Rental assistance and down-payment assistance continue to be well funded and utilized with budgeted money remaining for the rest of 2023 so the offerings continue. Good deeds offers a few options: 1) 5% of purchase for resident occupied and 15% purchase for price capped. Future restrictions are in place in perpetuity and they are close to the goal with eight more homes to deed restriction in 2023 in order to meet the goal. Locals first program has slowed, based on interest rates of home loans but the program is a valid opportunity with budget remaining. Additional programs include Aid for ADUs (Accessory Dwelling Units) and the Rent Local Program which incentivizes homeowners to rent to local workers vs having a vacant home or short term renting. This program was just launched in June 2023. A variety of program information can be found at boldhousingmoves.com 4.3 Capital Improvement Policy Proposal Presenter(s): Missy Johnson, Housing Coordinator The housing staff provided a memo to the Authority to summarizing the several discussions leading up to now, related to the Capital Improvement policies in relation to Maximum resale values. Johnson reiterated the goals of price capped deed restricted housing: 1. The primary goal is to maintain affordably priced homes. 2. Incentivize property maintenance and upkeep and disincentivize failure to maintain essential systems of a home such as electrical, HVAC, plumbing, appliances and life safety systems. 3. Better inform potential homeowners on the total cost of home ownership and recognize the difference between home repairs and home improvements. Johnson also acknowledged the previous discussions from Authority input that Currently, policy achieves maintaining affordably priced homes but policy does not provide incentives or 7 disincentives for homeowners to maintain minimum levels of property upkeep. The Authority acknowledged that there is currently little financial motivation to maintain the home with upkeep, based on the current policy and that there is room for increased education to current owners and to prioritize setting expectations for new buyers. 1. Require a pre-and post-inspection of certain home systems as part of the sales process to determine the condition of the home and establish the maximum resale price prior to sale. Should the home not meet the minimum functional expectations, the maximum resale value would be re-evaluated and lowered, in dollar value, if it requires additional maintenance or replacement to the following systems: a. Electrical (service panel, GFCI outlets, circuit breakers, non-permitted electrical work) b. Plumbing (shut off valves, water heater) HVAC (heating system) c. Appliances (refrigerator, cook-top and oven) Smoke alarm/Carbon monoxide detectors 2. Implement a uniform depreciation schedule and apply an approved value list of industry standard costs, such as what is listed in the Chamonix Housing Guidelines. 3. Define the difference between home repair and home improvements and further clarify capital improvements. Improvements; Item 1.b which cur including without limitation solar panels, the amount of the cost to be included in the maximum resale price shall be reduced by the amount of any Chamonix Housing Guidelines and add the following: a. Upgrade home insulation beyond adopted energy conservation code minimum standards and professionally air seal the home for efficiency Upgrade to a smart thermostat b. Switch to a heat pump water heater c. Upgrade to pre-approved energy-efficient windows beyond adopted energy conservation code minimum standards. d. Install pre-approved solar energy production systems e. Define the difference between home repair and home improvements and further clarify capital improvements. For example, the following from EXHIBIT rmitted Capital Improvements; Item 1.b which currently states f. without limitation solar panels, the amount of the cost to be included in the maximum resale price shall be reduced by the amount of any rebates, and shall then be depreciated by g. following: Upgrade home insulation beyond adopted energy conservation code h. minimum standards and professionally air seal the home for efficiency i. Upgrade to a smart thermostat j. Switch to a heat pump water heater k. Upgrade to pre-approved energy-efficient windows beyond adopted energy conservation code minimum standards. l. Install pre-approved solar energy production systems 8 The Authority continues with current policy that states that sweat equity may not go towards maximum resale value. Conversation ensued around the special assessments and the consideration of following a depreciation schedule. Right now, we allow special assessments to be included in the maximum resale value but apply a depreciation value against it over time. The Authority reviewed and discussed if the above covers top concerns, including clarification around topics that were brought forward by some Vail Commons owners at previous Authority meetings. At this point, the Authority agrees on the above mentions and the Housing Staff will prepare red -lined documentation to prepare for a future recommendation to Council. The housing staff will bring back policy documentation to show changes associated. 4.4 Amended Community Lottery Procedures This item was moved to the next VLHA meeting. 4.5 Resolution No. 11, Series of 2023, a Resolution Approving the Purchase of a Deed Restriction Interest in Property (Type III Deed Restriction) in the Town of Vail Legally Described as Heather of Vail Condo Unit: A-2, Eagle County, Colorado with a Physical Address of 5197 Black Gore Drive Unit A2, Vail, Colorado; and Setting Forth Details in Regard Thereto. Presenter(s): Martha Anderson, Housing Coordinator MOTION: Godec SECOND: Williams PASSED: (5 - 0) 4.6 Opting In to Proposition 123 Presenter(s): Martha Anderson, Housing Coordinator Motion to Opt-In and review a letter of support at the Aug. 22 Vail Local Housing Authority Meeting MOTION: Godec SECOND: Williams PASSED: (5 - 0) Motion to exit the regular scheduled meeting and move to executive session at 4:50 p.m. MOTION: Williams SECOND: Denton PASSED: (5 - 0) 5. Executive Session 5.1 Executive Session per C.R.S. §24-6-402(4)(a)(e) - to discuss the purchase, acquisition, lease, transfer or sale of real, personal or other property interests and to determine positions relative to matters that may be subject to negotiations; developing strategy for negotiations; and instructing negotiators regarding: International Building at 164 RailRoad Ave., Minturn, CO. Presenter(s): George Ruther, Housing Director Time: 15 Min. 6. Any Action as a Result of Executive Session 6.1 Any Action as a Result of Executive Session The authority re-entered regular session at 5:15 p.m. With a motion to move to direct staff per direction in executive session MOTION: Williams SECOND: Godec PASSED: (5 - 0) 9 7. Matters from the Chairman and Authority Members 7.1 Matters from the Chairman and Authority Members Presenter(s): Steve Lindstrom, VLHA Chairman Williams mentioned the invite to attend a Housing Summit in Big Sky on September 11-14. The panel will include a great discussion about breaking down the barriers with hopes that Authority members can attend. The Authority has budget for professional development if there is interest from Authority members. Ruther updated the group about the West Middle Creek parcel (development) RFPs have been received and will be reviewed on Friday. The list will be paired down with next steps for groups to do on-site presentations. The goal is to present to the Town Council on September 5th with recommendation. Anderson updated the group about the upcoming Housing Colorado Conference in October in Keystone as an additional opportunity for Authority to participate and funds are available to attend. 8. Adjournment 8.1 Adjournment 5:00 PM (Estimate) Meeting adjourned at 5:20 p.m. MOTION: Williams SECOND: Denton PASSED: (5 - 0) 9. Future Agenda Items 9.1 Vail Housing 2027 Land Banking Investment Banker Discussion Review Retirement and Remote Worker Policies Review Chamonix Vail Deed Restriction Review Suggested Policy Edits re: Capital Improvements 10. Next Meeting Date 10.1 Next Meeting Date August 22, 2023 : 21 75 South Frontage Road West Housing Department Vail, Colorado 81657 970.479.2150 vailgov.com MEMORANDUM To: Vail Local Housing Authority From: George Ruther, Housing Director Date: August 22, 2023 Re: Attracting Private Sector Investment to Deliver Deed-Restricted Homes in Vail. I. PROBLEM STATEMENT Vail citizens have identified the lack of availability of housing as the #1 most critical issue facing the long-term success and sustainability of the Vail community. According to the 2022 Town of Vail Community Survey, “Housing for resident occupied households” emerged at the top of the list as the most critical policy action the Vail Town Council should pursue. In response to the growing importance of homes for local residents, the Vail Town Council, in partnership with the Vail Local Housing Authority, acting as Vail Home Partners, adopted the Vail Housing 2027 Strategic Plan. The goal of the Plan is clear and concise - acquire 1,000 additional deed-restrictions by the 2027. The public sector alone cannot achieve the Town’s adopted housing goal. Of significance is the role that private sector participation and investment plays in helping the Vail community achieve its adopted housing goal. Vail Home Partners has committed to an “all of the above” approach to acquiring deed restrictions, including demonstrating the political will in support of new housing developments. National research has concluded that the development review and entitlement processes have a negative impact on the ability of the private sector to deliver housing solutions. According to the U.S. Department of Housing and Urban Development, local land use regulations, building codes, administrative policies and practices, and red tape are major contributors negatively effecting the supply of housing across the country. The development review and entitlement process has the reputation amongst the private sector development community as being: 22 unusually complex, nonresponsive, unnecessarily protracted in length, lacking in facilitation, filled with discretion, subjectivity, uncertainties and risks, misaligned, and an overall broken system. Simply put, the development review process and land use regulations relating to achieving housing solutions are broken. The Town of Vail cannot sustainably support the financial subsidies often required of deed-restricted development. Private sector participation and investment is critical to addressing the Town’s housing needs. If the development review process and land use regulations are not fixed and private sector investment cannot be attracted, it is likely the Vail community will fail to achieve it adopted housing goal. Failure in this regard is not an acceptable outcome. II. PURPOSE The purpose of this memorandum is to present options for consideration to improve the development review process with the objective of removing the barriers to private sector investment in deed-restricted housing. In 2018, the Vail Town Council adopted ten housing policy statements. This action is being taken to advance the three specific housing policies of the Town of Vail which include: #2 Housing Partners – We use public/private partnerships and actively pursue local and regional solutions to increase the supply of deed-restricted homes. #3 Private Sector Importance – We foster a proactive and solutions-oriented environment that promotes private sector investment to create deed-restricted homes. #5 Breakdown Barriers – We align our land use regulations, building and energy conservation codes to achieve our vision and housing goal, and development applications are thoroughly, timely and efficiently reviewed….getting to “yes” is our shared objective. III. POLICY OBJECTIVES Policy objectives were developed by the Vail Local Housing Authority to attract private sector investment to developing deed-restricted homes in Vail to achieve the town’s adopted housing goal. Each of the policy objectives were developed with input and feedback from private sector participants having demonstrated experience developing deed restricted homes in Vail. The policy objectives are intended to support and advance the policy statements adopted by the Vail Town of Vail 23 Town Council. Each of the policy objectives is further supported by a specific strategy or action. In some instances, a specific strategy or action supports more than one policy objective and are listed accordingly. The policy objectives and supporting strategies or actions include: 1. Eliminate the complexities a. Create a simplified development application and development review process for development in the Housing (H) Zone District. b. Explore opportunities for a “location and extent” development review process c. Amend the Housing (H) Zone District to make deed restricted residential development, with prescribed development standards, a use by right. d. Adopt more objective development review criteria with a combination of prescriptive and performance standards. 2. Increase responsiveness a. Create an organizational culture of getting to “yes” b. Use the knowledge, expertise, and skills within the organization to identify solutions to development challenges prioritizing facilitation as an approach to get to regulation compliance. c. Implement a “shot clock” and commit to a development review process schedule including adopting guaranteed turnaround times for reviews and approvals. d. Acknowledge that changes to development application requests are inherent to the development review process and do not require the republishing of the public notice. e. Establish an iterative plan development process beginning with a schematic or sketch plan review and ending with design development plans as the approved development plan. f. Create opportunities for greater transparency and communication to the public of development applications in support of housing solutions. 3. Improve timeliness a. Commit to a development review process schedule including adopting guaranteed turnaround times for reviews and approvals b. Assign adequate staffing and financial resources to development applications which support housing solutions c. Amend administrative practices and acknowledge that changes to development applications request are inherent to the development review process. (republishing) d. Prioritize development applications proposing housing solutions and achieving compelling public interests 4. Promote facilitation and alignment a. Create a culture of getting to “yes” within the organization b. Maintain up-to-date planning documents which reflect community vision and economic market conditions c. Adopt development incentives for housing solutions (parking, density, gross residential floor area, landscape area, etc.) d. Adopt clear policy direction in support of housing solutions Town of Vail 24 e. Host annual policy setting/policy direction meetings with the Vail Town Council, Planning & Environmental Commission, and Design Review Board. f. Create a position within the organization to collaborate with the private sector on housing development applications (i.e. think economic development). g. Acknowledge that developing homes for year-round and seasonal residents living and working in Vail is a matter of compelling public interest. h. Convene semi-annual meetings with Vail Town Council and the Planning & Environmental Commission, Design Review Board, and Town Staff to discuss what is working and what may not be working in delivering housing solutions. 5. Minimize or eliminate risk a. Balance flexibility in regulations with more prescriptive development standards (setbacks, site design, mobility solutions, landscape areas, etc). b. Create an iterative review process with multiple steps of plan review including sketch plan, schematic design, design development, and construction drawings. c. Amend the fee structure to defer fees until a later stage of development to avoid high costs associated with financing permitting fees. (planning, plan review, public way, etc.). d. Create a graduated fee structure which aligns with the increasing levels of an iterative review. e. Develop checklists and administrative procedures for development review to improve the clarity of expectations. f. Adopt design standards and guidelines for deed-restricted residential development. g. Amend the Vail Land Use Plan to encourage and promote the importance of deed-restricted residential development within the community. 6. Remove discretion and uncertainties a. Balance flexibility of regulation with more prescriptive development standards (setbacks, site design standards, mobility solutions, landscape areas, etc). b. Amend the design guidelines and standards to reflect the realities of developing deed-restricted homes. c. Amend the development review process of the Housing (H) Zone District making deed restricted homes a use by right requiring only design review. IV. RECOMMENDED NEXT STEPS The Town of Vail Housing Department recommends the following next steps: Forward a recommendation to the Vail Town Council on the proposed policy objectives and strategies and action steps to attract private sector investment in housing solutions in Vail, with edits, if any. Adopt a plan and timeline for implementation noting that some of the recommended strategies and action steps require legislative action and others are administrative procedural changes. 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Projects cannot be funded by Proposition 123 program unless the local community where the -- affordable housing dwellings in their jurisdiction, (2) committing to increase that baseline by 3% and (3) expediting the development approval process to a maximum of 90 days. Grant funds from Proposition 123 would help the Town of Vail address the current housing crisis and affordable homes in Vail. The Vail Local Housing Authority respectfully asks that you direct the Town staff to submit the Proposition 123 opting-in application without further delay. Sincerely, Steve Lindstrom, Chair, VLHA Dan Godec, VLHA Kristin Kenney-Williams, VLHA James Wilkins, VLHA Craig Denton, VLHA 53 54 75 South Frontage Road West Housing Department Vail, Colorado 81657 housing@vail.gov vailgov.com MEMORANDUM To: Vail Local Housing Authority From: George Ruther, Housing Director Martha Anderson and Missy Johnson, Housing Coordinators Date: August 8, 2023 Re: Amended Community Housing Lottery Procedures Administrative Procedures I. Purpose The purpose of this memorandum is to propose amendments to the administrative procedures for the community housing lottery process. No amendments are proposed to the qualification requirements or the ticket eligibility criteria. II. Background On May 16, 2023, there was a Town of Vail application submittal deadline for a community housing lottery and sale of 2090 Zermatt Lane, Unit C, West Vail. More than 100 interested applicants applied to purchase the home. This is the highest number of applications received for a community housing lottery. Unfortunately, until housing conditions improve, lottery of this size are likely to be the new norm. In the end, 100 applications were reviewed with there being only one selected home buyer. 99% of the time invested in the lottery selection process was focused on individual that were not selected for home purchase. The housing staff believes there is a better way, her is a summary of time spent for the current lottery review process: Housing staff meets with applicants for 30-minute increments for pre-scheduled appointments to review application submittal requirements 55 Each application is thoroughly reviewed by the housing staff, taking more than 25 hours and spread out over multiple days. Additional time is spent responding to emails and multiple calls. More than 100 pre-qualification letters were provided by local lenders in the community. Applicants devote an undetermined amount of time assembling the documentation and materials needed to submit a complete application. Upon reflection, the housing staff considers if the time and service to the community could be better invested in educating applicants and to complete alternative prioritized housing tasks vs. reviewing all supporting documentation. III. Summary of Recommended Application Review Procedure The housing staff recommends amendments to the administrative procedure when conducting a community housing lottery. The objectives of the amendments are to: improve customer service, convenience, and ensure a fair and equitable opportunity to participation in a community housing lottery process, and to increase the efficiency and utilization of the staff time and resources. The list below defines what is required of individuals in order to apply, and varied list exists for individual applicants who own their own business. Of the below items, those that have an (*) are the documents required for upload in the application, moving forward, while the other items would be required of the selected top five applicants: *as specified within the application. *Current copy of Homebuyer Class certification, from the approved Town of Vail list of eligible courses. *If applicant does not currently own any improved residential property in the Town of Vail (non deed-restricted), answer the questions accordingly and complete the affidavit of non-deed restricted ownership, print and get notarized for upload, listing third party contact that can confirm the validity, Two most recent pay stubs at the time of submitting the application. Two prior years of state and federal tax returns. Valid and current mortgage prequalification letter as specified within the online application. 2 | Page Town of Vail 56 Considerations: The most time-consuming part of the overall application review process is the review of prequal letter, taxes and paystubs to confirmation applicants as qualified year-round staff, making 75% of their income working for an Eagle County employer. Using the recent lottery as an example, the housing staff estimates that significantly more of the applicants would have qualified as homebuyers. The odds of being drawn first in the randomized draw are likely to change as there may be more applicants in the drawing. This process will not guarantee approval for all applicants. 3 | Page Town of Vail 57