“Buy-down” rent program gets green light from council

The Denver City Council signed off Monday on an unusual pilot program that will “buy down” the rent for 125 households so that they can afford to live in marketrate apartments and other rental housing.

Mayor Michael Hancock and city housing officials have portrayed the $1 million subsidy program as a targeted way to help some low- and middle-income families stay in Denver after years of fast-rising rents. The affordable housing program will function similarly to a popular housing voucher program overseen by the Denver Housing Authority but will help people who fall within a wider income range (up to $72,000 a year for a family of four).

The city is seeking employer partners to kick in money for the program in exchange for the participation of their workers. Among employers in talks to take part are St. Joseph Hospital and the Colorado Health Foundation.

But the program has critics, including some who fear that the city is only perpetuating high-market rents by helping owners of vacant rental units fill them.

Councilman Kevin Flynn made that point Monday before casting the sole “no” vote.

“The corporate sponsors — the corporate partners that are recruited through this program — instead of contributing to this program, why don’t they pay their workers more?” Flynn said earlier, on June 25, when the proposal was introduced. “That’s the answer to affordability ultimately in this city — that people earn a living wage.”

City housing officials have argued that the program isn’t likely to have farreaching effects on the local apartment market, in part because of its limited scope.

The council approved, 11-1, a nearly $1.2 million funding agreement with the DHA to run the program. That sum includes $180,000 for administrative costs. Officially, the initiative is called the Lower Income Voucher Equity (LIVE) Program.

“The reality is that there are units all across the city” in the program, Councilwoman Debbie Ortega said. “They are not all downtown, high-end units. … They are units that can (be used to) put people into housing immediately.”

Individuals and families who qualify will receive up to two years of rent subsidies to ensure they pay no more than 35 percent of their monthly income toward housing costs. Participants will have to be employed full-time and take part in financial coaching sessions at the beginning.

During the program, a small portion of the program’s contribution toward participants’ rent will be set aside to help them build savings. In an example provided by the city, a single person earning $37,800 a year would pay adjusted rent of $1,103 for an apartment with a market rent of $1,500 a month.