Room to improve low-cost housing
Denver’s affordable housing ordinance has been a failure. That much almost everyone seems to acknowledge. In the past five years, for example, it has resulted in only 16 affordable units being built.
As a result, Councilwoman Robin Kniech will offer a rewrite of the ordinance in an effort to provide developers with greater flexibility in meeting the requirements — while including both bigger carrots and sticks.
We’llwant to see her final version before concluding it’swhat the city needs, but suffice it to say the present ordinance isn’tworth salvaging.
Twelve years ago, the city passed what seemed to be a sensible law to push developers into building affordable housing— forcing any development with 30 or more units to make 10 percent of the units affordable to people earning less than the median income.
The city would also give the developer cash rebates of up to $5,500 per unit built.
But the law came with a provision that allowed developers to sidestep the requirements, paying cash to the city instead of building the affordable units.
And that’s what happened. The city’s cash in lieu of development fund grew to $7.6 million while few affordable units were built.
Under Kniech’s proposal, developerswould have to pay the city moremoney to opt out of the lawin high-demand areas, such as downtown or around transit areas— 75 percent of the marked-down price rather than the current 50 percent.
On the other hand, the city would offer $20,000 in cash rebates per unit to encourage construction.
Kniech is also considering decreasing the 30-unit threshold that prompts the law to kick in, although when she met with the Denver Post editorial board, she wasn’t sure how low she’d go.
The law only covers for-sale housing because state law and court rulings prevent similar requirements on rentals.
Whether this reboot of a flawed law is the answer remains to be seen. But the city should either try another version of the present ordinance, as Kniech proposes, or drop such a mandate entirely from its books.