Littleton to begin drafting policy for affordable housing mandate, incentives

Council continues to mull ordinance to promote building more affordable homes

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Littleton City Council gave the green light to city staff to begin drafting language for an inclusionary housing ordinance that would mandate affordable homes for new developments as well as grant major incentives for builders to create majority-affordable units.

The move comes after a framework, crafted by the city's housing task force, was presented to council Aug. 9.

The ordinance is "five years in the making," said Director of Community Development Kathleen Osher, as it seeks to address several needs identified in the city's 2017 housing study, which called for more affordable rental units and starter homes. 

The language will need to be brought before council for a public hearing before members vote on whether to pass it, though a majority of council has expressed strong support for the measure.

As currently proposed, the policy would be two-pronged. It would require that 5% of all new developments with five or more units — including single-family homes — be affordable for people between 60% and 80% of the area median income, or AMI.

According to Arapahoe County AMI data for 2021, that would represent a spectrum of people making between $42,000 and $56,000 per year. For a family of four, it would be between $60,000 and $80,000 per year.

Developers who refuse to build affordable units would be subject to a fee — according to the current proposal — which could be thousands of dollars and would go towards funding other affordable projects such as through the city's housing authority, South Metro Housing Options.

The second prong of the ordinance unlocks major incentives for developments that are majority affordable, about 90% or more. Incentives include reducing open space and parking requirements and allowing additional floors. 

Molly Fitzpatrick, co-founder and managing director of Root Policy — a housing research firm — said these incentives are meant to help offset the cost for developers building below-market-rate housing.

"Those also are often the lowest margin projects in terms of a project margin, so we're trying not to discourage that type of development," said Fitzpatrick, who helped draft the framework for council that will become the first draft of the housing ordinance. 

Taken together, the two pieces of the ordinance are designed to spur a range of new affordable housing — from smaller townhomes to denser apartments — across the city. 

Read more: Affordable housing projects move forward in Littleton

The ordinance could also be enforced on developments that have been approved but have yet to see building begin, such as at the Aspen Grove shopping center, where the city's planning commission recently approved nearly 500 new homes.

“We have aging shopping centers that have a lot of concrete," said Kelly Milliman, councilmember for Littleton's District 4 — home to Aspen Grove — who voiced support for the ordinance.

The trade-offs for developers did raise concern from some councilmembers who took issue with reduced parking requirements and increased heights. 

“When there’s not enough parking, who hears about it, we do," said Councilmember At-Large Pam Grove. “There’s a price that people are paying for this to get this (housing) diversity."

District 2 Councilmember Jerry Valdes said certain new developments "change the character" of Littleton and questioned if the city "had the land” to build out potentially hundreds of new affordable units.

District 1 Councilmember Pat Driscoll said he would prefer affordable housing be set aside strictly for those working and living in Littleton and asked “why are we allowing people from other parts of the Denver area” to live affordably in the city.

Councilmembers elected in November that campaigned on expanding housing — Mayor Kyle Schlachter, Mayor Pro Tem Gretchen Rydin and District 3 Councilmember Stephen Barr — expressed strong support for passing an ordinance along with Milliman, who is also a member of the housing task force.

Rydin, in response to claims that building more housing "changes the character" of Littleton, said it "makes it better." 

“We need these homes in mixed-income places, that is what’s going to build community," Rydin said.

Despite differences, council unanimously decided to move forward with draft language that will be further reviewed before a final vote at an unknown date. 

littleton, affordable housing, inclusionary housing ordinance

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