IMAGE: Artist rendering of the proposed 232 Pagosa Street development, flanked by Pagosa Baking Company and the Alley House Grille.
We’re struggling lately, with a couple of crises. Maybe more than a couple.
“We” meaning specifically Pagosa Springs.
Two of the struggles are closely related. A shortage of employees, and a shortage of housing for employees.
During a recent conversation, I was told that Pagosa Springs Medical Center is struggling to find full-time employees, even at wages of $35 per hour. As a result, I was told, the hospital contracts with a company that supplies ‘traveling’ medical staff, at $140 per hour.
Yes, we need housing for employees making $35 an hour. But most of our community’s employees make much less than $35 an hour. I believe $17 an hour is considered fairly generous ’round these parts.
These same struggles are taking place all across the U.S., and in various places around the globe. Different communities are attempting to address them in various ways.
Or, sitting on their hands and failing to address them.
Take ‘density bonuses’, for example. The Town of Pagosa Springs believes that’s a tool for addressing our housing shortage.
Should a developer be allowed to exceed the density normally allowed in a neighborhood, if they’re promising to provide a little bit of ‘affordable’ housing? If so, how much ‘affordable housing’ should the Town require, in exchange for allowing a private developer to increase his or her profit margin?
Over the past few years, the Pagosa Springs Town government has made several notable moves to try and address the housing crisis. In 2019, they adopted a new community housing plan, the “Roadmap to Affordable Housing,” created by Crested Butte housing consultant Willa Williford working in collaboration with Pagosa Housing Partners, a local non-profit. You can download the plan here.
The Town Council also put in place some new limitations on the STR (Short Term Rental) industry, within the town limits.
Additionally, the Town Council approved fee waivers for affordable- and workforce-housing projects, and in April 2021, approved a ‘density bonus’ policy to allow developers to exceed the density limits in the various zoning districts in exchange for ‘deed restrictions’ on a portion of the new housing units.
Those density bonuses have since been requested by a few developers, including Nuance Industries, who offered to keep the rents for a portion of their apartments at the 120% Area Median Income level, or below.
The project is a conversion of the former Pagosa Springs Inn and Suites motel, into the Pagosa Springs Apartments.
The Town of Pagosa Springs worked closely with the developer to help make this project happen. Part of the cooperative work included the creation, by the Town Planning Department, of a new ‘density bonus’ policy that allows a developer of residential units to exceed zoning requirement limits, when some of the units are ‘deed-restricted’ to serve ‘middle income’ individuals and families.
Nuance Industries is currently advertising “Grand Opening Special” pricing.
As we discussed in some detail, in an editorial series last October, the Pagosa Springs Apartments set aside 25 units with rents slightly higher than what can be afforded by a household with an ‘average’ Pagosa income. (These are the so-called ‘affordable units.) The rest of the units have no deed restrictions, and can be rented at ‘market rates’.
Here’s what the State of Colorado considers to be a reasonable rent in Archuleta County for a household earning 120% of the Area Median Income.
These are the published rental limits for the Colorado Housing and Finance Administration (CHFA), for Archuleta County. The Town Council, in its wisdom, agreed with the Pagosa Springs Apartments developers that 25 of the 98 units would be priced at 120% of AMI, or less.
The problem with ‘Area Median Income’ in a mountain resort community like Pagosa Springs is, a large segment of the ‘Area’ population are relatively wealthy retirees with incomes higher than a typical working family earns in Archuleta County. That fact skews the government-established ‘AMI’ and creates ‘unaffordable rents’ like the ones shown in the CHFA chart above.
So then, it would appear that — as a result of their negotiations with the Town Planning Department — this new apartment building is allowed to charge $1,728 for a ‘deed restricted’ studio apartment… of less than 350 square feet. In exchange, the developers were allowed to build 98 units instead of the zoning-defined limit of 66 units.
According to the agreement with the Town, the ‘deed restricted’ units in the Pagosa Springs Apartments convert to ‘market rates’ after seven years.
This little introductory discussion about ‘density bonuses’ is intended to set the stage for the conversations that took place at the February 7 Pagosa Springs Town Council meeting, where the Council rejected a density bonus request for 232 Pagosa Street.
This rather massive project — massive, that is, compared to the surrounding buildings — has been the subject of protests coming from the neighboring property owners, claiming that the proposal violates the intentions of the Land Use and Development Code (LUDC), the Downtown Master Plan, and the Town’s Comprehensive Plan.
In order to make the building as large as possible — or perhaps for some other reason — the property developers, Dirty Rose LLC and Reynolds Ash & Associates, wanted to include eight luxury condo units in the building.
But the Town LUDC limits the number of allowed dwelling units on this particular property (luxury or otherwise) to seven.
The developers had obtained preliminary approval for the building, as designed by Reynolds Ash & Associates, last September from the Town Planning Commission. The neighbors were not happy, however, and filed an appeal with the Town Council, claiming that the building was too big for the neighborhood. In particular, the neighbors contended that the ‘density bonus’ requested by the developer — to allow the eighth luxury condo unit — violated the Town’s ‘density bonus’ ordinance.
The Town Council decided that, because the ‘density bonus’ had not yet been approved (by the Council) and because the Planning Commission approval was merely ‘preliminary’, the Council could not reasonably overturn the Planning Commission action.
The Council had to wait, they said, until the actual ‘density bonus’ application came before them.
With that background in place, we can discuss the public hearing on February 7 at Town Hall.
Except, it wasn’t actually a public hearing.