Tug of war over Boulder County’s affordable housing tax money

By the end of the year, a sales and use tax extension approved by Boulder County voters in 2023 is expected to generate more than $17 million for affordable housing initiatives, according to county officials. This will mark the largest influx of local funding for affordable housing in years. 

The funds can be used for “affordable and attainable housing and related support services” across Boulder County, as stipulated by the ballot measure. 

However, a core question remains: Who should control how the money is spent? Cities want to use the money within their existing affordable housing programs, while the county is contemplating a centralized application process.

This issue has sparked conversation between cities and the county over how to equitably and effectively address the region’s housing shortage.

The Boulder County Regional Housing Partnership, a group consisting of officials from the City of Boulder, Longmont, Superior and other cities and towns, has pitched a plan to county officials to allocate the revenue to cities and towns based on population size. They argue this will provide a predictable funding source and minimize administrative costs.

This plan would direct approximately $5.2 million to the City of Boulder, the largest share, followed by Longmont with $4.8 million. Boulder County would get $2.8 million. 

Under the plan, most of the money would be spent on building new homes. A smaller portion could be spent on housing support services like rent assistance. 

Officials from the involved municipalities pushing for local control over these funds, rather than the county being the lead decision-maker, argue that their existing affordable housing programs are already suited for efficient distribution.

“Overall, there’s a desire across the communities to minimize committees and minimize additional processes,” said Molly O’Donnell, director of Longmont’s housing and community investment division, during a meeting with county officials last week.

County officials, however, expressed reservations about the population-based approach. They are considering creating a new application process with broader criteria, similar to how the county already distributes grants to local organizations.

Boulder County Commissioner Marta Loachamin, a key advocate for the tax, emphasized that distribution should be need-based, considering factors such as housing cost burden, race and ethnicity to ensure equitable distribution across the region.

“To strongly look at it from a population standpoint worries me from an equity standpoint,” Loachamin told Boulder Reporting Lab. She added, “I can’t control what each city and town does in their ‘technical process’ to meet equity goals. But we can look at the entire county, which I believe voters are asking us to do, and make sure we address housing needs.” 

The new funding comes as the county grapples with financial challenges in its affordable housing program. The Boulder County Housing Authority manages 900 units across the county and is currently constructing a 400-unit Willoughby Corner affordable housing project in Lafayette. The development has so far exceeded the original budget by more than $4 million, according to county records.

Last year, voters approved County Issue 1B, which extended a 0.185% sales and use tax for 15 years to pay for affordable housing initiatives. The tax was first adopted in 2018 to pay for an alternative sentencing facility at the Boulder County Jail. Construction is scheduled to be completed by 2025.

The money is the first major opportunity for the region to chip away at its housing goals, which for years have been unfunded.

In 2017, Boulder County’s cities and towns, including Boulder, declared a housing crisis and set a regional goal of constructing 800 new affordable homes per year. The aim is to ensure that 12% of the county’s housing stock is permanently affordable by 2035. Meeting this goal was estimated to cost about $25 million per year, according to city and county officials.

Currently, about 8% of the City of Boulder’s housing stock is deed-restricted as affordable, compared to about 2.8% in Boulder County, according to a county official.

Kurt Firnhaber, the director of Housing and Human Services, acknowledged that the region is falling short of meeting its goal. He said the new tax revenue could help close the gap. The city has housing projects in the pipeline that just need money, he said.

“We are very much going to need this money,” Firnhaber said. “We are very encouraged that the voters passed the 1B funding. But it couldn’t have come soon enough.” 

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