Development, Land Use & Planning

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Development Process, Land Use, and Planning Issues & Positioning

Video Transcript: Development, Land Use & Planning

Slide 1

Hello, and welcome to the Fundamentals of the Development Process related to Land Use and Planning. My name is J.J. Folsom and I am a Director with Community Builders, a nonprofit organization that works with communities throughout Colorado and the intermountain west. The Division of Housing partners with local communities to create housing opportunities for Coloradans who face the greatest challenges to accessing affordable, safe, and secure homes. DOH supports projects ranging from homelessness prevention to homeownership. The Local Officials Toolkit, a joint project between DOH, Enterprise Community Partners, and Community Builders is intended to help local communities identify possible housing opportunities and streamline their process to achieving housing faster. The toolkit will explain affordable housing in the context of Colorado separated into three parts. The toolkit includes Affordable Housing 101, this training which is 201 Fundamentals modules that can be found online, and a set of potential tools and solutions such as policies, programs, and partnerships to name a few that communities can use and are already using to address housing needs in Colorado. A menu of options that would in most cases make up the bulk of the content for the in person trainings. Enterprise Community Partners is a national nonprofit that brings together nationwide expertise, partners, policy leadership, and investment to multiply the impact of local affordable housing development. They deliver the capital, develop the programs, and advocate for the policies needed to create and preserve well-designed homes that people can afford in inclusive and connected communities. Community Builders is a leader in community planning, design, and development with core competencies in training and capacity building, direct technical assistance, and public engagement and facilitation. In applying these skills, we bring a range of expertise in community planning and development, including housing, transportation, economic development, urban design, and downtown revitalization.

Slide 2

The purpose of this training is to introduce the development process, key participants throughout development, important development types, and how you, as local officials, can support development of affordable housing in your communities.

Slide 3

First, I will give a brief overview of the development process.

Slide 4

Whether building market rate or affordable housing, the development process generally has the same six steps illustrated on this slide. The development process and timeframe can be unpredictable depending on the complexity of the project. And, like any project, unexpected hurdles can occur at any time. For example, issues with financing sources could occur, development review can be stalled for a variety of reasons, labor and material shortages can continue to get worse, and the list goes on.

Slide 5

This timeline illustrates a representation of a typical development process. It's critical to emphasize the length and importance of the pre-development phase, which can take up to three years before any construction ever occurs. This is often described by developers as the risk they take for many projects.

Slide 6

Phase one, the visioning, focuses on understanding your community's need for affordable housing, housing types to respond to that need, your jurisdiction's capacity for the participation, and additional partnerships that may be necessary to fill your capacity gaps.

Slide 7

Phase two, planning and pre-development, takes your vision into a specific development scope of work, including locating and/or purchasing a development site, working with a design team to prepare a design concept, and preparing feasibility assessments and cost estimates. It is important to note that we discuss more about the key development feasibility factors in the housing finance training that can be found in the link where you found this presentation. In some cases, these are challenges for development to happen at all, and in others, it may be viable to develop units but just not at the price points to address key housing needs in your community.

Slide 8

Phase three, securing funding, includes obtaining the financing required to design, construct, and operate the development for the duration of the project, including determining and securing multiple financing sources and completing multiple applications for the various funders.

Slide 9

Phase four, the design phase, includes the final contracting with a variety of design experts that I'll describe in more detail later. Phase five, the construction phase, includes the preparation of the development site and actual construction or rehabilitation.

Slide 10

The operations and final phase includes obtaining tenants and signing leases or selling units, identifying service providers and preparing agreements, managing the property or securing a property manager, and long-term stewardship and management of the development.

Slide 11

So, who's involved in this process? A lot of key players as you can see on the screen here. Local government involvement is often needed to initiate the affordable housing development. Given the complexity of developing affordable housing, and the inherent risk involved in real estate, each successful project requires extensive collaboration and coordination from an experienced team of professionals. Active local government participation can lower the risk, reduce costs by streamlining some of the processes, and help to develop the best product to meet local needs. Rarely does a single entity have the resources and capacity to develop affordable housing independently. Consequently, partnerships bring together the expertise and resources needed to complete the housing development process, and may enable a local government to work on solving different aspects of the local housing picture without pushing any one agency beyond capacity or duplicating services. When deciding on a course of action to address community housing needs, local governments must first determine their internal capacity. There are deficiencies and gaps in order to assess what partnerships and consultants may be required. The graphic here illustrates a variety of public, private, and consultants that are typically needed for a successful project.

Slide 12

There are a number of typical challenges that contribute to creating housing that is affordable, including land availability, costs, financing for acquisition and construction, the availability of developers and contractors infrastructure, regulatory barriers, public process, political and staff support, and staff capacity and technical expertise.

Slide 13

Now, we will take a brief pause for you to write down on your worksheet answers to the following questions: What are some of the biggest barriers and challenges to housing affordability you aren't aware of in your community, including those listed on the previous slide? How much power, influence, or other resources do you, as an elected official, or other local government members you work with have to address the barriers you see? What have you or your community tried already? Where have you found success and what have you learned?

Slide 14

Affordable housing can refer to a wide range of housing models and development approaches. Affordable housing can be rental or for-sale, include a variety of building types that I will discuss in the following slides that can be subsidized or unsubsidized. Depending on the need in your community, the different types of affordable housing will create options for diverse groups of constituents. Each housing type has its own characteristics, advantages, and disadvantages. For example, developing any of the building types here can create more housing units with a lower development and land cost per unit compared to the same number of single-family homes. But they may also face additional community resistance in communities opposed to more dense development than what exists today.

Slide 15

In the next several slides, I'm going to discuss several building types for affordable housing--most of what you're probably familiar with, and many of these probably exist in your community today.

Slide 16

Multifamily housing is one of the most common types of affordable housing. It consists of multiple housing units within the same building and on the same lot. These can be renter-occupied apartments or owner-occupied condominiums, and it can range from small (four- or five-unit) buildings up to large (50 or more unit) buildings, as illustrated on the screen. Communities may differ in their need for housing with more or less number of bedrooms to better align with the demographics in the market and to better serve families. Multifamily buildings can create more housing units on a single site and typically result in greater density and most likely result in lower price points and more affordable units, particularly in areas with high land costs which we're seeing all throughout Colorado compared to single family construction.

Slide 17

Duplex, triplex, and quadplexes consists of two, three, or four housing units, as the name suggests, within the same building and shared interior walls. These can also be renter- or owner-occupied for the purposes of financing and, in some cases, building codes. These are treated more similarly to single-family homes versus multifamily buildings.

Slide 18

Garden courts or cluster homes typically consist of four or more units arranged with front doors facing a common green space with a rear alley for garage access. These housing types also create more units per acre and typically result in greater density compared to single-family construction while having the feel similar to a single family home.

Slide 19

Preservation or rehabilitation of existing affordable housing stock that improves and maintains existing housing that might otherwise become uninhabitable or pose health and safety risks. An example includes purchasing and improving an aging apartment complex to enable it to continue to operate with affordable rent. This eliminates the cost to develop the building from the ground up as infrastructure is already in place, and the entitlement process is typically already complete. It also helps current tenants remain in their community and home. While preservation is often less expensive than building new, adapting and rehabilitating existing buildings can still be a very costly endeavor.

Slide 20

Small housing types include tiny homes, accessory dwelling units (also known as ADUs), and small lot single-family homes. Tiny homes are a type of single-family home that is typically less than 400 square feet that seeks to reduce construction and operating costs and environmental impacts through building a smaller structure. Tiny homes can be developed individually but are often developed in groups as illustrated on the slide. ADUs can be a form of affordable housing in which a smaller independent residential unit is developed on the same lot as an existing single-family home. These are sometimes referred to as 'granny flats' or accessory apartments. The structures for ADUs can be attached, detached, or integrated into the primary building. Small lot single-family or attached homes are built on a lot or lots that are smaller than the typical lot in a given neighborhood or jurisdiction. These small housing types carry their own set of challenges such as regulations in the case of tiny homes and ADUs, and not necessarily being as affordable as one would think due to their size. Similarly, ADUs need significant programmatic support and financing to realize at scale.

Slide 21

Cohousing is a model where each household has their own private unit or bedrooms, but share spaces and facilities such as kitchens, dining spaces, and recreation spaces with other households. These are especially common in housing designed to be multigenerational or for older adults, since they create communal living situations that increase the opportunities for social interactions.

Slide 22

Prefabrication or modular housing are homes built in an off-site warehouse or factory that are shipped to the development location and attached to a permanent foundation. Benefits include cost savings for both construction and maintenance, better quality control due to lack of weather issues, and less waste than typical on-site construction methods. Prefabricated houses of all kinds must adhere to state and federal building codes and undergo regular inspections just like any site-built home. This ensures that prefab homes are at least as safe as their site-built counterparts.

Slide 23

Manufactured housing, commonly known as mobile homes or trailers, are also built in a factory like prefab homes. There is no construction that happens on site. Manufactured homes are constructed on a steel frame, shipped on its own wheels, and then laid on a crawlspace or a slab of concrete. In some cases, the wheels that brought the house to the building site are not removed, rather covered up with side skirting. Unlike prefab homes, manufactured homes only have to adhere to HUD standards, which has much more lenient rules and regulations.

Slide 24

For our next exercise, we'd like you to answer the following questions: Given the range of housing types described in this section, what types of housing are you interested to learn more about? What housing types do you think would help address some of the housing needs in your community? And has your community been successful in developing these types of housing in recent years? Why or why not? How supportive are your community members and constituents to the types of housing you think are needed? What can you do in your role as a local official to improve support where it's lacking?

Slide 25

Key levers local governments can use to impact local development include a needs assessment, vision and strategy, policy and regulations, incentives, direct participation in development, and building community support.

Slide 27

First, you should develop a local housing strategy which includes creating partnerships and including people who have different opinions and expertise on the work being done. It's critical to include people who represent the community's diversity. This group usually includes key local leaders and a mix of public, private, and likely nonprofit entities. Understanding your market. Some communities may be resistant to new development occurring while others may welcome it. Thus, consideration for the local housing market context is critical. A housing needs assessment is an in-depth study usually conducted by an independent market analysis to evaluate how well the market is meeting the housing needs of different income levels. In most cases, the assessment quantifies how many units are needed by price point, tenure, housing type (such as number of bedrooms), and demographic or market segment. Your local government should identify high-level and meaningful vision and goals that enable you and the general public to track your jurisdiction's overall progress in achieving your housing policy objectives. You should identify potential strategies and tactics to create new affordable housing in your community. Some examples include creating more land-efficient strategies such as infill, preservation and redevelopment of existing housing, land baking, and greater density allowances where appropriate. Many jurisdictions in Colorado are part of a larger region where jobs may not be in the same city, town, or unincorporated area where the people live. In these regions, it may be more beneficial to create a regional housing strategy versus each having their own strategy. This would allow for jurisdictions to begin to support or develop projects outside of their jurisdictional boundaries. One option would be to create a regional housing authority. This would require engagement of local and regional leaders to build a shared understanding and align regional partners around housing goals and strategies for shared priorities. It would also allow for cross-jurisdictional sharing of resources and funding. There are many examples of regional housing authorities throughout Colorado, as well as regional collaboration throughout Colorado in towns that are nearby each other.

Slide 28

For this next discussion, we'd like you to answer the following questions: What is the political will for affordable housing development in your community? What regional coordinate coordination exists, if any for affordable housing development in your region is your region of potential candidate to create a regional housing authority? And would you like additional information about the steps involved?

Slide 29

Next, we will discuss aligning plans and policies to expand housing choices and affordability. One way to do this is to remove barriers such as the review and permitting process. As the expression goes, time is money. And this is especially true for developers. These barriers can make the difference in a project's financial feasibility for the developer. Other typical barriers include dimensional standards, such as minimum lot sizes, and excessive setbacks. Increasing allowable building types in zone districts not only provides a variety of housing, but can reduce land and building costs as discussed previously. Eliminating use restrictions that prohibit residential uses in core areas by making desired housing choices used by right in key locations reduces the amount of time it takes for projects to be reviewed and approved because they do not require a special approval or variances.

Slide 30

Incentives are another way local governments can encourage affordability. Some incentives to consider in your community include providing land and infrastructure at a reduced or no cost, reduce the minimum lot sizes and minimum home sizes, reduce number of parking spaces required per unit, increasing the height and providing density bonuses, which could be based on a percent or a number of affordable units provided in the development, and reducing the development fees for affordable housing developments.

Slide 31

For our next exercise, please answer the following questions: What specific barriers that we discussed exist in your code? Are there others? What changes or updates is your community currently working on? What incentives has your community tried to already have these lead to additional affordable housing units?

Slide 32

Development roles of the local government. There are many roles your local government can take in this development process. Active local government participation can lower the risk, reduce costs by streamlining some of the processes, and help to develop the best product to meet the local needs. While not as common, it is possible for a local government to take on the primary development role. And in order to do this, you must be certain you can manage a project and provide backbone support to the effort. You also need a keen understanding of what project or initiative is needed in your community. Community credibility and political capital and staying in power to see the project through the many years that are needed to plan, build, and operationalize a housing development as we discussed previously. More commonly, local governments partner with one or more of the following private developers: nonprofit developers, public housing authorities, community land trusts, public utilities, or local anchor institutions such as major employers or school districts. One of the most important roles a local government can take is being a primary funding partner in the form of assisting with the creation, allocation, and/or administration of local, state, and federal funds, providing staff time for planning or project management, providing land appropriate for development. As described previously, land is one of the most expensive pieces in the development process, and providing operations project management capacity, and providing property tax exemptions.

Slide 33

A Community land trust is a community-based organization designed to ensure community stewardship of the land primarily used to ensure long term housing affordability. The trust typically acquires the land and maintains ownership of it permanently. It enters into a long-term renewable lease with homeowners instead of a traditional sale. When the homeowner sells, the family earns a portion of the increased property value. The remainder is kept by the trust preserving the affordability for future low- to moderate-income families. CLTs are generally managed by a nonprofit or quasi governmental organization and governed by a body comprised of purchasers of CLT homes, members of the public, and government and nonprofit stakeholders to ensure they remain grounded in the needs of the community.

Slide 34

There are four major community land trusts in Colorado that your local government could potentially partner with depending on your location. Each of these in the PowerPoint you downloaded has a hyperlink that you can click on to learn more about each trust. Elevation Community Land Trust works throughout the state is one of the largest CLTs in Colorado and the country. The Urban Land Conservancy based in Denver predominantly works in the Denver metropolitan area, however, they have expanding expanded beyond Denver. The Colorado Community Land Trust, which recently merged with Habitat for Humanity also predominantly works in the Denver Metro area, and the Chafee Housing Trust, which provides affordable housing to Chafee and Lake County residents.

Slide 35

As part of the Local Officials Toolkit, we have provided several case studies that are highlighted in videos available on the DOLA DOH website. One of those case studies as illustrated here is the Anvil Mountain development in Silverton, Colorado, which is a great example of a public-private partnership. San Juan County used fees in lieu from the Purgatory Ski Resort, located several miles away from their affordable housing development fund, to purchase land and Silverton and they utilize DOLA grants to build the infrastructure. Due to Silverton's inability to find interested developers, San Juan County acted as the developer for the affordable apartment complex. The use of modular apartments allowed the county to build economically and quickly and the county provided a streamlined development review process. As mentioned, this case study can be found on the DOH DOLA website for more detailed information.

Slide 36

For this next discussion, we would like you to answer the following questions: In order to undertake a new affordable housing development in your community, what is your local government's internal capacity? What are your deficiencies and gaps? What partnerships and consultant assistance may be required to complete a housing development in your community?

Slide 37

In addition to assisting with removing policy barriers to affordable housing, as described previously, it is important that local officials politically support affordable housing initiatives in your community. Local officials should be promoting housing affordability as a positive and important factor in improving neighborhood conditions by demonstrating that affordable housing is a community asset, providing housing for the workforce and local jobs during and after construction, bringing in federal and state subsidies, generating sales tax revenue, and reducing traffic and pollution. For local officials that may not support affordable housing developments, it is important to provide them with factual information about the housing needs and positive impacts in your community. It is also important to build awareness for the current housing need and what affordable housing solutions exist that address the unique context of your community, including residents and constituents within the conversation about development, and how more options for affordable housing can benefit your community. You should encourage community participation in the process to learn about residents' housing needs. Engaging with the community will identify high priority challenges in addition to providing an opportunity to address concerns about affordable housing development. Public support is also needed to achieve meaningful policy change that enables the expansion of housing choices. Despite it's importance, many communities have difficulty building support for affordable housing. The 'not in my backyard' syndrome, or NIMBY, is the tendency of neighbors to oppose a proposed project, often based on misconception or fears that property values, safety, or quality of life will be compromised. For affordable housing projects to be successful, outreach that builds and maintains community support should begin in the early stages of the development process. Reaching populations that do not typically attend traditional community meetings is critical during the early stages on affordable housing development engagement process. Trust building is key to this effort and it takes time and culturally relevant outreach. Above all, it's critical to respect the feelings, knowledge, and expertise of the community members you engage. In many communities throughout Colorado, residents of color and low-income residents are being displaced by new higher density development that purports to create more units and thus more affordable housing and equity. In many cases where affordable housing is built, it is often too expensive or does not fit the needs of the communities families. The basic economics and the corresponding social contract from the community's perspective cannot be ignored. And they might ask, Are we really getting more affordable housing and equitable planning outcomes from these planning processes? And what is created for them? If not, how will it change this time? Robust community wealth building and anti displacement strategies that can address how you can keep existing residents in place can begin to address this conundrum.

Slide 38

Being clear about the scope of the housing strategy will make it easier to engage the community in a transparent and accountable way. The following steps should be outlined when developing the scope: Identify the goals of the process, communicate the decisions the community can impact, be transparent about what is already decided based on the funding the development is receiving, and provide a timeline and decision making structure that will dictate the process, including how often you will meet with the community as well as internally. Intentional efforts should be made to identify the families excluded from or underrepresented in decision making processes in the past. In addition, potential residents should be informed about the development. In addition, you should identify other stakeholders that bring important perspectives, concerns, and expertise to the housing planning process such as housing and non-housing practitioners, industry representatives, economic development, planning department, informal community leaders, and advocates. The community engagement process is a chance to get the community's help answering the tough questions local officials and staff must grapple in order to craft a housing strategy that is responsive to the needs of the community. While it might seem daunting to put controversial questions before the community, these questions will emerge regardless, and it is best to be frank about them from the start in order to ensure an inclusive process and secure community buy-in during the implementation. To ensure targeted and robust feedback from committee members, you may also need to provide additional information related to the overall engagement process and the components of a housing strategy such as the kind of information community members will need to comfortably and meaningfully engage in planning a housing strategy such as examples of housing types and a glossary of terms, determine how the materials and information will be delivered in a way that ensures accessibility for a diverse range of community groups, and identify who the point of contact is moving forward for people that have questions about the development. There are a range of engagement strategies to consider depending on the scope of the planning process, the community landscape, the capacities of your local officials, your organization, the community, the questions that need to be answered, and the resources available. Many of these questions can be found in the corresponding workbook for this training on the DOLA DOH. Lastly, to build community support, it is important to be clear with the participants about how the local government plans to use feedback from a task force public meetings, online surveys, and any other engagement and to follow through on those commitments. Your local officials and/or staff should be transparent about who will be involved in deciding, what will be incorporated into the final strategy, and how local officials will share and discuss with the public which community recommendations were used and which were not and why.

Slide 39

For this last exercise, please answer the following questions: What particular groups of people who live in your community are missing from engagement or public discussions about housing? For example, racial groups, people with disabilities, seniors and others. What partnerships and consultant assistance may be required to complete a housing development in your community?

Slide 40

For more information and other learning sessions, please look at the DOLA Division of Housing website resources listed on your screen or reach out to Andrew Atchley or Natalie Wowk as listed on the screen. Be sure to sign up for DOH's email blast as well. Thank you very much for your participation in this webinar. I look forward to seeing you soon for in-person trainings.