Grand considers community land trust to grow affordable housing

A possible solution to the Grand County housing crisis could be in nonprofit assistance.

On Tuesday, the Grand County commissioners heard from Director Reed McCulloch of the Chaffee Housing Trust, a private nonprofit meant to develop homeownership and rental opportunities for residents who cannot afford market rate housing in Chaffee and Lake counties. McCulloch answered questions on how he went about creating the organization.

The Chaffee Housing Trust is a community land trust. This is different from Grand County’s Colorado Headwaters Land Trust, which focuses on land conservation. Instead of conserving open spaces, the Chaffee Housing Trust holds the land for affordable housing.

“A community land trust, in short, builds homes or acquires homes by partnering with the developer,” McCulloch said. “It then sells the improvements on the land but retains title to the underlying land in perpetuity.”

The houses have a $25-a-month ground lease with a number of stipulations, including that the future resale of the home be capped at 25% of the market-based appreciation. The model allows homeowners to build equity while keeping the house affordable for future buyers.

“Really, what the model is designed to do is to give renters who are priced out of the market locally the opportunity to get homeownership,” McCulloch said.

The Chaffee Housing Trust has a board made up of these homeowners, government officials and the general public. Funding for the two-person nonprofit comes from grants, state funds, developer fees and donations.

Through this program, there are currently seven homeowners and one renter hoping to own in Salida , plus five in Buena Vista. Another 13 homes are under construction in those towns. The organization is also getting to work in Leadville with 10-12 homes starting in the next year or two.

The nonprofit bridges the gap between the cost to build and sales price of qualified low-income households while guiding future homeowners through the process and assisting with financing. According to McCulloch, this type of work has been growing across Colorado in recent years.

The local government comes in to help in a number of ways, including land banking, where properties are held until they can be developed for affordable housing. Allowing higher density builds and reducing fees for infrastructure also help with creating the affordable developments.

Developers often work with the Chaffee Housing Trust because developments wanting to be annexed into a town are often required to provide a number of affordable units. The general requirement is that one in eight units must be available to households with an area median income of 80% or below. To meet that requirement, developers often hand off the project to the Chaffee Housing Trust.

“Developers initially were resistant to it,” McCulloch said of this requirement. “I think they embraced the fact that because housing is so out of control, they had employees that can’t find housing. Understanding the problem, they’re willing to play along.”

Sheena Darland, operations director for the Grand County Housing Authority, said that a number of local developers have approached her about bringing more affordable housing to the county. She added that fixing the housing crisis has to be a collaborative effort.

“Everybody has got to be involved,” Darland said. “We have to develop those relationships if we’re ever going to move forward with housing. I think it’s great that the private sector has been so interested.”

The commissioners were enthusiastic about bringing a program similar to the Chaffee Housing Trust to Grand, but doing so would take the initiative of someone interested in creating it.

“I’m hoping we can find someone in Grand County to raise their hand and be our Reed,” Commissioner Rich Cimino told McCulloch. “To work with Sheena, and work with the Grand Foundation, and work with all our local developers, and work with our local banks. I really want to copy what you’ve done.”

Commissioner Kris Manguso added that, because of the need for low prices, this work will likely need to be done in incorporated areas. She added that getting towns to require affordable housing in annexation would also be helpful.

“I think if we can get the towns on board, that is everyone’s best bet,” Manguso said. “They have the infrastructure.”

The commissioners also encouraged Darland to move forward with consultants for a regional housing authority forum, and opened discussions with Hot Sulphur Springs and the East Grand School District regarding workforce housing.

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