In an effort to bring more options to the affordable housing market in Denver, the City has proposed an updated requirement from Developers. Currently, when building a new multi-family or commercial construction project there is a linkage-fee that developers will have to pay. The city then uses the funds gathered from the linkage fee to use for income-restricted housing. The city now is proposing a mandate to replace that linkage fee by requiring developers to set aside a set number of income-restricted units for their projects.
Developers of non-residential commercial construction however, will still abide by the linkage fee requirement. Except, that fee is to be four times the cost from before.
What are the Income-restricted housing mandate details?
- Non-residential construction to pay a linkage fee of $4 – $8 per square foot.
- Previously costs were between $0.44 – $1.86 per square foot.
- Residential Developments of eight or more units must set aside 8% – 12% of the units for income-restricted.
- Higher property value areas of the city will require an additional 2-3% more of income-restricted units.
- Mandate is proposed to be in place 99 years
- The level of affordability is still to be decided, from 60% – 80% of area median income.
A meeting about the proposed changes to be held Nov. 4th, 2021.
What is the linkage fee and affordable housing efforts?
The combination of linkage fees from new construction developments both commercial and residential is used to help the ‘affordable housing fund’, which has been established since 2017. Approximately, 24.9 million dollars have been collected by 2020 to aid in several income-restricted housing projects. This along with Denver taxes are an effort to cut down on homelessness which has been a concern that is steadily increasing. It is believed, by increasing the linkage fee and associated costs, these efforts can help curb homelessness.
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