Michael Yerman, Senior Planner, My Rural Planner, Salida, CO

1. Successful Strategies for Building Affordable
Housing In Your Community
2023 Economic Development
Conference for the EDA Denver Region

2. What is the overall goal for building affordable
housing?
-To ensure our community’s workforce is successful in attaining long-term, safe
and energy efficient housing
-To provide housing opportunities both home ownership and rental
opportunities to our community’s workforce
-To work with our local Municipal and County leadership on creating capacity
for future housing within their jurisdictions
-Establish economic growth and strong communities
-Address Free Market Failures to deliver housing options for our workforce

3. A Strong
Housing
Market is a
Good Thing!
Strengthens property taxes and sales taxes
Provides for multiplier effects from an influx of home
ownership
Increases community pride and reduces blight
Eliminates a barrier to economic growth
Spurs infrastructure development that improves quality
of life
Ignites the local housing market

4. Public/Private Partnerships- City of Trinidad Housing Now
Problem
 High material costs and supply chain issues driving up
construction costs
 20% higher labor costs than neighboring communities
 Large Affordability gap for new construction
 Development pipeline of projects exist- gap financing needed
to get going
 Entitlement issues and tax issues on vacant subdivision lands
 High Vacancy and Blight Rates in Historic/Mix Use Downtown
Properties
 Lack of Matching funds for State Housing Program
 City’s Economic Incentive Fund to hard to navigate
Goal: 100 new or rehabbed workforce
housing units
 Needs Assessment 2022-Cited an immediate Housing Need of over 200 units
 Units must be occupied by workforce or permanent residents
 City receives deed restriction for incentive funds

5. “Housing Now” Incentive Program
# Project Application Recieved
Type of Incentive Location Total UnitsFunded Units
Project Cost Incentive Funds Tap Fees
1 New Trinidad Apartments 7/18/2022 Downtown/Vacant 443 N Commercial 7 7 $997,865 $175,000 X
2 Depot Lofts 7/18/2022 New Housing 516 E Elm St 12 10 $4,885,000 $150,000 X
3 Arizona Live-Work Lofts 7/18/2022 Downtown/Vacant 847 Arizona Ave 2 2 $265,000 $50,000
4 Timberview Apartments 7/18/2022 New Housing 705 E 7th St 24 10 $4,800,000 $150,000 X
5 East Street School 7/19/2022 Downtown/Vacant 210 East Street 14 5 $6,700,000 $125,000
6 State Street Rental Properties 7/19/2022 Downtown/Vacant 503 & 507 State St. 2 2 $150,000 $50,000 X
7 Eagles Hall 7/21/2022 Downtown/Vacant 204 Pine St. 9 5 $2,200,000 $125,000 X
8 234 N. Commercial Loft 7/22/2022 Downtown/Vacant 234 N Commercial 1 1 $200,000 $25,000
9 Holy Trinity School 7/28/2022 Downtown/Vacant 237 Church St. 30 8 $3,500,000 $200,000 X
10 Links Apartments Addition 8/31/2022 New Housing 1401 Santa Fe Trail 12 10 $1,900,000 $150,000
11 920 & 926 Stonewall Avenue TSJC 2/9/2023 Downtown/Vacant 920 &926 Stonewall 2 2 $420,000 $50,000.00
115 62 26,017,865.00
$ $1,250,000
Solution- $2 Million Economic Incentive Program
3 Programs
• Downtown Residential Vacant or Blighted Property
• Incentive for downtown property owners to reactivate
rental units
• $25,000 per unit
• Max. $200,000 per property
• Units must be currently vacant or need major rehab
• New Workforce Housing Construction
• $15,000 per unit
• Must be rentals under 80% AMI or 100% AMI for sale
• Affordable Housing Tap Fee Deferral Program
• Deed restricted units tap fees paid

6. SE Plains Workforce Housing Build

7. The Housing Problem In the SE Plains
 Lack of housing supply leads to
outmigration/stagnation
 Appraisals are not adequate due to lack of
sales comps
 Inverted Housing market-
 Sales price > Materials + Labor
 Scarce availability of contractors and
labor
 Exponential materials cost increases make
small projects prices unattainable to local
workforce
 Lack of available buildable lots

8. Blighted Housing to New
Workforce Housing
New Workforce Housing Priced from
$151,250-$265,050
All Price Points Under 100% AMI

9. Workforce Housing Defined
Working Class Families “Missing Middle”
Want to serve workers who have been invested in
their employment
Opportunity zone investor to buy duplexes to rent
back to employees or “Qualified Census Tracts”
Price Points allowed for a wide range of AMIs to
participate 70%-120% AMI
Household size 70% 80% 90% 100% 110% 120%
1 person $ 40,320 $ 46,080 $ 51,840 $ 57,600 $ 63,360 $ 69,120
2 person $ 46,060 $ 52,640 $ 59,220 $ 65,800 $ 72,380 $ 78,960
3 person $ 51,800 $ 59,200 $ 66,600 $ 74,000 $ 81,400 $ 88,800
4 person $ 57,540 $ 65,760 $ 73,980 $ 82,200 $ 90,420 $ 98,640

10. Timeline
 June 23, 2021- Presentation of Feasibility Report and Decision by SECED Board
to move project forward to local municipal participation.
 June 24, 2021- Market Demand Study Contract Executed and economic planning
begins. Cost $10,000.
 July-August 2021- Memorandum of Understanding MOU executed with each
participating County and Municipal jurisdiction and SECED.
 July 2021- Design Charrette
 August 2021- Release of Developer RFQ
 September 2021- Finalist Developer Selection
 November 2021- Contract Execution with Developer and SECED.
 October-February 2021-2022- Pre-sales offering and loan consultation begins.
 January 2022- Transfer of land to be developed to SECED.
 March 2022- Developer Closes on Construction Loan
 May 2022- Groundbreaking in first community every 3 weeks in next location.
 July 2022- Transfer of Land to developer
 December 2022- First Homes Completed
 June 2024- Final Home Completed

11. Strategies for Workforce Housing
 Take Care of the “Broccoli” Costs
Horizontal Infrastructure Costs-Roads, Water, Sewer, Gas,
electric, etc.
Land Costs
 Remove Engineering and Architecture Costs from Final Sales
Price
Allows for competitive construction cost bidding
 Waive permit fees and take care of tap fees
 Deal with entitlements so projects are shovel ready
 Homeownership or qualified 1st time buyer programs VA
home Loans or USDA
 Regional Collaboration to make project large enough for
economies of scale
 Desired Result- Only pass on vertical costs to end buyer

12. SE Plains “Broccoli” Incentive Package
 Over $1,000,000 in Local cash or in-kind contributions
 $ 618,000 Local Government ARPA Match
 $200,000 Opportunity Zone Infrastructure
 $200,000 in additional infrastructure and land donations
 Land Donations- La Junta, Springfield, and Las Animas
 Surveying/Entitlements $95,000
 Planning- 7 Subdivisions- 2 ROW Vacations
 Land Purchases $262,000
 Down Payment Assistance Award- $444,000
 DOLA Energy Impact Funding $598,966

13. Benefits of Economies of Scale
 Over 40 units allows for attracting larger regional
developers
 Buying power on construction materials and things like
appliances
 Predictable Reliable Labor
 Regional Collaboration=Shared costs
 Surveying, Design, Planning, Legal, etc.
 SECED Serving as Regional Oversight on behalf of
Counties and Municipalities
 SCEDD Serving as Planners for entitlements and project
management

14. Risk Reduction
 Every Development Project has Risks
 American Rescue Plan Act Eligible
Project
 Developer Responsible for
Construction Financing
 RFQ Developer Selection and Design
Process
 Incentives provided by Regional
Collaboration
 SECED holding Land or Surety
throughout the process
 Pre-Sales
 Pay for performance

15. Lessons Learned
 Early buy-in Local elected
 It takes a Team effort (partners)
 Build a spec home – people like to see the
finished product
 Clarification of requirements where no codes
exist – get it in writing
 Utilities – written confirmation of what they
will/will not provide and ask for a timeline
 Rentals will allow you to add economies of
scale
 Interests Rates Change Almost +$250 increase
monthly payments for our end buyers
 Be nimble if you want to move quickly
 AMI rental rates are tough comps if new
housing doesn’t exist in the community

16. Thank You-
Questions?
Check out the Project at:
SE Housing Feasibility Report at
https://www.seced.net/housing.html
MY Rural Planner
https://www.myruralplanner.com