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Don Cohen: Housing solutions now in play

Don CohenEconomic Council of Eagle CountyVail, CO Colorado

Whats up with workforce housing? A lot, actually.Throughout 2007 and moving into 2008 the Economic Council of Eagle County has focused intensely on the development of workforce housing. Since early last year, the Economic Council has provided management, research and facilitation to the Housing Action Team (which we all call HAT).HAT has become the authoritative source of public-private housing cooperation in Eagle County. All the towns (Vail, Minturn, Redcliff, Avon, Eagle and Gypsum) and Eagle County are represented by elected officials. The private sector is represented by executives from Vail Resorts, FirstBank, Polar Star Development and Beaver Creek Resort Company. This group has spent a year in developing a sophisticated understanding of the depth and complexity of housing.While all the HAT members represent different constituencies and interests, the team has achieved a much better common understanding of the challenges and solutions the county faces in workforce housing.The team has developed three core principles that are helping shape strategy and tactics for getting workforce housing built.The first is that creative solutions should be tried before tax solutions. Methods for creating more housing with tools of negotiated regulation, incentives, cost-recovery and strategic equity investment should be applied before any talk about additional taxation should occur.The second is to respect local municipal interests. One size wont fit all. A voluntary multi-jurisdictional approach has been set in motion. Here, a different model for Eagle County is being created where each of the towns and the county set policy and guide housing solutions that best fits their needs. However, at the center of this activity, all the entities would share centralized management, administration and marketing activity for the deed/residency restricted properties. This saves unnecessary duplication of staffs and provides potential and current owners a single point of contact. Finally, building activity needs to be synchronized so that inventory doesnt become overbuilt and unsold projects fail.The third is that economic diversity strengthens communities. The team recognizes that workforce housing needs to built in all areas of the county between Vail and Gypsum. Though land at the east end of the county is expensive, new and redevelopment projects need to be planned that offer opportunities for residents to live closer to where they work. At the same time, the west end of the county cant serve as the dumping ground for lower-cost housing. Along these same lines, it is critical that what workforce housing products which are built have a good mix of size, floor plans and architectural interest that promotes community quality and economic diversity.Clearly, affordable housing is a continuing hot topic in our community. A lot of ink has and will continue to flow across the pages of county newspapers. Recently there was one op-ed piece in the Vail Trail that talked about business taking the lead in housing.Perhaps not really knowing the make-up of the Housing Action Team, the author didnt realize the leadership efforts our major employers are already taking. They continue to participate and invest, in varying degrees, in housing. However, the reality is that 80 percent of the employers in Eagle County are small businesses. Even if a small businesses wants to do the right thing about employee housing, its simply unaffordable. Right now, the Economic Councils most recent workforce survey data shows that the majority of employers offer healthcare benefits. With double-digit increases in premium costs, small employers are stretching just to offer insurance coverage which leaves nothing for any kind of employee housing subsidy help.Another letter to the editor from a planner (someone who works for big developers) bemoaned the oppressive hand of more stringent affordable housing requirements. Outside of making inaccurate calculations on an outdated draft document, the writer assumed facts not in evidence and basically went to the free market can fix itself platitude. It cant, at least not under current market-force conditions.Eagle Countys resorts attract national and international capital demand for real estate that blows away normal market economics. And herein lies the absolute crux of any community housing debate: should a community give a leg-up advantage to future residents when those who came before got nothing?There are two views at play here. One is that a community can be responsible for providing financial guardrails by establishing a level playing field to help historically equalize the opportunity for housing attainability as tied to wages. The other is to accept the risks created by imbalances that an unfettered free market may create with the understanding that, when it collapses (S&Ls in the 80s, sub-prime today) it can have devastating impacts on a community.When employers cant fill jobs or find that wage inflation threatens their ability to stay in business, then the call will come. When and if that call does come, itll invariably be for significant government intervention bailout. Thats expensive, unpleasant and disruptive.Today, with the leadership of the Housing Action Team, unique solutions are being set into motion which involves private sector creativity and puts public money to work in priming the pump. Much of this front-end investment in public funding will be returned through equity repayments and existing sales and property taxes which, in turn, can be reinvested in future workforce housing opportunities.So whats up with workforce housing? Lots. Weve finished talking and now were doing.Don Cohen is the executive director of the Economic Council of Eagle County. He can be reached at dcohen@economiccouncil.biz


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