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HomeMy WebLinkAboutagenda.council.worksession.20250721AGENDA CITY COUNCIL WORK SESSION July 21, 2025 4:00 PM, City Council Chambers 427 Rio Grande Place, Aspen I.Work Session I.A Lumberyard Lottery Priories and Ballot Language II.Council discussion of the items published in the most recent information update, as needed Zoom Meeting Instructions Join from PC, Mac, iPad, or Android: https://us06web.zoom.us/j/86440086677? pwd=0b5qszkkTWBCtTEuE14b7GA2tiEZkD.1 Passcode:81611 Join via audio: +1 346 248 7799 Webinar ID: 864 4008 6677 Passcode: 81611 International numbers available: https://us06web.zoom.us/u/keYmGyIU3 Memo 21JULY2025 Lumberyard Priority Partnerships Ballot r1-1.pdf Exhibit A – Draft Ballot Initiative Resolution r1-1.pdf WS PPT 21JUN2025 Lumberyard r1-1.pdf 1 1 Page 1 of 5 MEMORANDUM TO: Mayor and City Council FROM: Chris Everson, Affordable Housing Development Project Mgr. THROUGH: Rob Schober, Capital Asset Director MEMO DATE: July 14, 2025 MEETING DATE: July 21, 2025 RE: Lumberyard Lottery Priories and Ballot Language REQUEST OF COUNCIL: Council is encouraged to discuss options for lottery priorities and employer partnerships for the Lumberyard project, and to review proposed language for a November ballot measure seeking voter approval for bond financing. BACKGROUND: The development agreement with Gorman & Company gives the City six months to decide on lottery priorities for essential workers, employment location, and employer partnerships and to set a cap and basic terms for employer-partnership units. The agreement also allows the City to implement the full Lumberyard project by issuing up to $70 million in municipal revenue bonds, backed by housing fund revenues. Voter approval for this financing would be required on November 4, 2025, to align with Gorman’s proposed timeline. DISCUSSION: As Council considers the options outlined below, it may be helpful to reflect on key characteristics of the Lumberyard affordable housing project – such as its location, scale, unit mix, and targeted income levels – as part of the decision-making process. Staff is available to provide any additional information Council may need on these or other relevant aspects. Work Location Priority Aspen City Council placed the following work location lottery priority on for-sale affordable units at Burlingame Ranch Phase 3: “A lottery priority will be provided to applicants who are employed within the Aspen urban growth boundary. This priority will be required for all initial sales and all future resales and will therefore be memorialized in the deed restrictions for the units at Burlingame Ranch Phase 3.” 2 Page 2 of 5 For the Lumberyard, Council may wish to consider the following options for a work location lottery priority: • Employment within the Aspen urban growth boundary • Employment within Aspen City limits • No priority, those employed in Pitkin County have equal priority • Other options may exist Further variations to consider may include: • Priority for initial lease-up and for all future lease turnover • Priority for initial lease-up only but not for future lease turnover • Priority for future lease turnover only but not for initial lease-up Work Type Priority Council may wish to consider establishing lottery priorities for certain types of employment. In doing so, it could be helpful to evaluate a range of employment factors, including: • Life safety and emergency response – such as police, fire, EMS, and hospital staff • Essential services and community well-being – including education, utilities, transit, sanitation, and childcare • Operational necessity – whether the role requires employees to live close by to perform critical functions or respond quickly • Community resilience – positions that contribute to the town’s ability to function during crises or disruptions • Employee retention challenges – sectors that face significant difficulty attracting or keeping employees – including healthcare, education, hospitality, retail • Economic or social impact – roles that play a key part in supporting the local economy or cultural fabric Council may also wish to weigh whether prioritization should reflect short-term pressures, long-term community sustainability, or a mix of both. Although not a recommendation, below is a partial list to consider for discussion: 3 Page 3 of 5 Public Safety & Emergency Services • Firefighters • Paramedics / EMTs • Police officers • 911 dispatchers Education and Childcare • School teachers • Early childhood educators • School / ECE support staff Healthcare • Doctors & nurses • Medical technicians and health aides • Mental health professionals • Hospital or medical support staff Public Services • Transit drivers and mechanics • Public works employees • Water, electric, sewer, sanitation workers • Snowplow operators Essential Retail • Grocery store employees • Pharmacy workers Tourism and Hospitality • Hotel staff • Restaurant workers • Maintenance and housekeeping staff • Ski resort or recreation area employees Other Priorities to Consider • Seniors • People with disabilities • Others with support needs Many more options may exist. In any case, staff recommends that Council aim to provide enough detail to minimize possible ambiguity and allow the developer to efficiently implement the policy without issues. Employer Partnerships Within six months of the agreement with Gorman, the City must decide whether to include employer partnership lottery priorities. Staff sees little risk in doing so, as Council can later choose whether to enter into any agreements. Maintaining this as an option would preserve flexibility and allow time to refine the program. Since the developer will own and operate the Lumberyard, the City cannot lease units directly or make blanket lease agreements with employers. The rent revenue stream must remain intact to support the project’s debt service. 4 Page 4 of 5 Together with the developer, staff recommend that Council take the following approach to facilitating an employer partnership program at the Lumberyard: • Area employers may pay a fee to the City to provide their workers a lottery priority • The purpose of the fee is to offset the City’s large financial investment in housing • Lottery priority and applicable fees could occur at initial lease up and/or future lease turnover • Partnering employers’ workers would need to qualify and pay rent like all other tenants • A cap on the total number of units allowable for such arrangements should be considered Because employer agreements could be made either before or after initial lease-up, the proposed model offers a potential ongoing revenue stream. Agreements made before lease-up could secure priority placement for multiple employees, while those made later would offer priority on a “next available” basis, allowing the program to continue over time. Staff are in the process of creating an employer partner engagement plan, and the process for engaging with potential employer partners will take a considerable amount of time and effort. Below is a high-level outline of the employer outreach approach as currently considered: Draft Outline – Stakeholder & Employer Engagement Plan August 2025 - April 2026 Overview: A comprehensive engagement process to support the City of Aspen's development of a long-term roadmap for affordable housing solutions with a focus on partnerships, including the Lumberyard employer-partner program. Phase One | Broad Picture: August – December 2025 Initial collaboration with area employers to introduce broad discussions. Phase Two | Partnership Development: January – April 2026 Individualized communications to advance partnerships with area employers. Meanwhile, it will be important for area employers to see the City’s commitment and progress toward development of the project. Within the 6 months allowed under the MDA with Gorman, Council need only decide on the positioning of the employer partner priority with respect to any other priorities desired along with some basic program parameters or terms. Also within 6 months, Council should consider a cap on the total number of units for the employer partner program. 5 Page 5 of 5 Once the above fundamental elements are established, with Lumberyard occupancy tentatively planned to begin in mid-2028, ongoing efforts to document specific employer agreements can continue through 2027. Draft Ballot Language Staff have collaborated internally and with external counsel to review past ballot initiative language and applicable state law. A draft proposed resolution is attached as Exhibit A and contains the suggested ballot language shown below. The language has been carefully honed to be concise to a practical level for voters, although it should be noted that there are some elements which both internal and external counsel agree must remain intact. Staff is prepared to discuss with Council during the work session. CITY OF ASPEN – DEBT FOR LUMBERYARD AFFORDABLE HOUSING PROJECT SHALL CITY OF ASPEN DEBT BE INCREASED BY AN AMOUNT NOT TO EXCEED $70,000,000, WITH A TOTAL REPAYMENT COST NOT TO EXCEED $152,550,000, FOR THE PURPOSE OF FINANCING THE LUMBERYARD AFFORDABLE HOUSING DEVELOPMENT; SUCH DEBT TO BE ISSUED IN THE FORM OF MUNICIPAL REVENUE BONDS OR OTHER MULTIPLE FISCAL YEAR FINANCIAL OBLIGATION, WITH SUCH TERMS, AND BEARING INTEREST AT A RATE HEREAFTER APPROVED BY COUNCIL, PAYABLE FROM THE CITY’S AFFORDABLE HOUSING FUND OR ANY OTHER AVAILABLE REVENUE OF THE CITY, WITHOUT ANY INCREASE IN TAXES, AND TO COLLECT, RETAIN, AND SPEND ALL REVENUE AND INTEREST FROM THESE BONDS AS A VOTER-APPROVED CHANGE TO THE CITY’S REVENUE LIMITS UNDER COLORADO LAW, ALLOWING THE CITY TO USE THESE FUNDS TO PAY FOR THE PROJECT OR ANY REFUNDING THEREOF. FINANCIAL/BUDGET IMPACTS: tbd ENVIRONMENTAL IMPACTS: n/a RECOMMENDATIONS: Council is encouraged to discuss options and provide direction to staff – either to begin pursuing a majority-supported course of action or to request additional information for further discussion at a follow-up work session. CITY MANAGER COMMENTS: ATTACHMENTS: Exhibit A – Draft Ballot Initiative Resolution Exhibit B – Presentation Slides 6 1 RESOLUTION NO. [___] (Series of 2025) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ASPEN, COLORADO, SUBMITTING TO THE ELECTORATE OF THE CITY OF ASPEN AT THE NOVEMBER 4, 2025, COORDINATED ELECTION A CERTAIN QUESTION AUTHORIZING THE ISSUANCE OF DEBT FOR THE PURPOSES DESCRIBED IN THE BALLOT QUESTION. WHEREAS, the City Council desires to place before the electorate of the City of Aspen certain ballot questions; and, WHEREAS, the City Council is authorized pursuant to Section 5.7 of the Aspen City Charter to, on its own motion, submit questions to a vote of the electorate; and, WHEREAS, the members of the City Council of the City (the “Council”) have been duly elected and qualified; and, WHEREAS, Article X, Section 20 of the Colorado Constitution (“TABOR”) requires voter approval for any new tax, the creation of any debt and for spending certain moneys above limits established by TABOR; and, WHEREAS, TABOR requires the City to submit ballot issues (as defined in TABOR) to the City’s electors on limited election days before action can be taken on such ballot issues; and, WHEREAS, November 4, 2025, is one of the dates at which ballot issues may be submitted to the eligible electors of the City pursuant to TABOR; and, WHEREAS, the Council hereby determines that it is necessary to submit to the electors of the City, at the coordinated election to be held on November 4, 2025 (the “Election”), the question of authorizing and issuing debt to finance the construction of the Lumberyard affordable housing project (the “ballot question”); and, WHEREAS, pursuant to Section 2.1 of the City Charter, all elections of the City are governed by the Colorado Municipal Election Code unless otherwise provided by ordinance; and, WHEREAS, Section 31-10-102, C.R.S., contained within the Municipal Election Code, permits any municipality to elect by resolution to utilize the requirements and procedures of the Uniform Election Code which will thereby permit the City to participate in the coordinated election being conducted by Pitkin County (the “County”) on November 4, 2025; and, 7 2 WHEREAS, affordable housing, community infrastructure, and a clean and resilient environment are essential to maintaining a world-class, competitive, economically sustainable tourist economy; and, WHEREAS, the Aspen Area Community Plan includes policies directing the City of Aspen to address affordable housing in the community; and, WHEREAS, a functional residential housing sector is essential to sheltering Aspen’s populations, supporting a stable economy, maintaining the health, peace and safety of the City of Aspen for its residents and visitors; and, WHEREAS, a tourist-based economy such as the City’s requires a sufficient number of employees to provide the services required to serve such an economy. Without adequate workforce housing, a tourist-based economy cannot thrive; and, WHEREAS, to allow for a sufficient number of employees to be hired to provide the services necessary to sustain a tourist-based economy there must be an adequate supply of workforce housing; and, WHEREAS, the Council has approved the design and received the necessary land use entitlements to construct the Lumberyard affordable housing development (“the Project”), a large-scale multi-phase affordable housing complex, to be built on City owned property; and WHEREAS, the Council finds it necessary and in the public’s interest to finance a portion of the costs of the Project through the issuance of municipal revenue bonds or other multiple fiscal year financial obligations; and WHEREAS, the Council finds that the issuance of debt for purposes of implementation of the Project is beneficial to the community because it ensures timely delivery of much needed affordable housing as compared to long-term construction phasing that may occur if the City cannot utilize debt as a funding source; and, WHEREAS, the Council hereby determines that the use of a responsible level of debt to facilitate implementation of the Project will best serve the community by minimizing long term financial exposure resulting from the cost escalation risks associated with long-term construction phasing; and, 8 3 WHEREAS, the Council now determines it is necessary to submit to the electors of the City, at the Election which will be held as a coordinated election with the County on November 4, 2025, the election question set forth herein ; and WHEREAS, it is necessary to set forth certain procedures concerning the conduct of the Election; and, WHEREAS, the Council finds that the adoption of this Resolution is necessary for the preservation of the public health, safety and welfare. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ASPEN, COLORADO, THAT: Section 1. All action heretofore taken (not inconsistent with the provisions of this resolution) by the City and the officers thereof, directed towards the Election and the objects and purposes herein stated, is hereby ratified, approved and confirmed. Section 2. Unless otherwise defined herein, all terms used herein shall have the meanings defined in the Uniform Election Code of 1992, Title 1, Articles 1 through 13, C.R.S., as amended (the “Uniform Election Code”). Section 3. Pursuant to TABOR and the Uniform Election Code, and all laws amendatory thereof and supplemental thereto, the City hereby determines that a special Election shall be held within the City on November 4, 2025, and that there shall be submitted to the eligible electors of the City the election question set forth herein. Because the Election will be held as part of the coordinated election, the County Clerk and Recorder (the “Clerk”) shall conduct the election on behalf of the City and officers of the City are hereby authorized to enter into one or more intergovernmental agreements with the County for the conduct of the Election pursuant to Section 1-7-116, C.R.S. Any such intergovernmental agreement heretofore entered into in connection with the Election is hereby ratified, approved and confirmed. 9 4 Section 4. The Council hereby authorizes and directs the officers of the City to certify on or before September 5, 2025, the following election question in substantially the form hereinafter set forth to the Clerk, which such question shall be submitted to the eligible electors of the City at the Election: CITY OF ASPEN – DEBT FOR LUMBERYARD AFFORDABLE HOUSING PROJECT SHALL CITY OF ASPEN DEBT BE INCREASED BY AN AMOUNT NOT TO EXCEED $70,000,000, WITH A TOTAL REPAYMENT COST NOT TO EXCEED $152,550,000, FOR THE PURPOSE OF FINANCING THE LUMBERYARD AFFORDABLE HOUSING DEVELOPMENT; SUCH DEBT TO BE ISSUED IN THE FORM OF MUNICIPAL REVENUE BONDS OR OTHER MULTIPLE FISCAL YEAR FINANCIAL OBLIGATION, WITH SUCH TERMS, AND BEARING INTEREST AT A RATE HEREAFTER APPROVED BY COUNCIL, PAYABLE FROM THE CITY’S AFFORDABLE HOUSING FUND OR ANY OTHER AVAILABLE REVENUE OF THE CITY, WITHOUT ANY INCREASE IN TAXES, AND TO COLLECT, RETAIN, AND SPEND ALL REVENUE AND INTEREST FROM THESE BONDS AS A VOTER-APPROVED CHANGE TO THE CITY’S REVENUE LIMITS UNDER COLORADO LAW, ALLOWING THE CITY TO USE THESE FUNDS TO PAY FOR THE PROJECT OR ANY REFUNDING THEREOF. Section 5. Pursuant to the intergovernmental agreement entered by the City to participate in the Pitkin County coordinated election, the City Clerk of the City of Aspen (the “City Clerk”) has been appointed as the designated election official of the City for purposes of performing acts required or permitted by law in connection with the Election. Section 6. If a majority of the votes cast on the question authorize the issuance of bonds as described in the bond question set forth above, the City intends to issue such bonds in the approximate aggregate principal amount of $70,000,000 to pay the costs of the Project, including the reimbursement of certain costs incurred by the City prior to the execution and delivery of such bonds, upon terms acceptable to the City, as authorized in a resolution to be hereafter adopted and to take all further action which is necessary or desirable in connection therewith. The officers, employees and agents of the City shall take all action necessary or reasonably required to carry out, give effect to and consummate the transactions contemplated 10 5 hereby and shall take all action necessary or desirable to finance the Project and to otherwise carry out the transactions contemplated by the resolution. The City shall not use reimbursed moneys for purposes prohibited by Treasury Regulation §1.150-2(h). This resolution is intended to be a declaration of “official intent” to reimburse expenditures within the meaning of Treasury Regulation §1.150-2 Section 7. Pursuant to Section 1-11-203.5, C.R.S., any election contest arising out of a ballot issue or ballot question election concerning the order of the ballot or the form or content of the ballot title shall be commenced by petition filed with the proper court within five days after the title of the ballot issue or ballot question is set. Section 8. The officers of the City are hereby authorized and directed to take all action necessary and appropriate to effectuate the provisions of this resolution. Section 9. If any section, paragraph, clause or provision of this resolution shall for any reason be held to be invalid or unenforceable, the invalidity or unenforceability of such section, paragraph, clause or provision shall in no manner affect any remaining provisions of this resolution. Section 10. All resolutions or parts of resolutions inconsistent herewith are hereby repealed to the extent only of such inconsistency. This repealer shall not be construed to revive any resolution or part of any resolution heretofore repealed. Section 11. The effective date of this resolution shall be immediately upon adoption. INTRODUCED, READ AND ADOPTED by the City Council of the City of Aspen on the [___]th day of August 2025. ___________________________ 11 6 Rachael Richards, Mayor I, Nicole Henning, duly appointed and acting City Clerk do certify that the foregoing is a true and accurate copy of that resolution adopted by the City Council of the City of Aspen, Colorado, at a meeting held on the day hereinabove stated. _______________________________ Nicole Henning, City Clerk 12 Aspen Lumberyard Affordable Housing Lottery Priories and Ballot Language July 21, 202513 Agenda 2 of 11 •Work Location Priority •Work Type Priority •Employer Partnerships •Ballot Language 14 Work Location Priority 3 of 11 • Urban growth boundary • Aspen City limits • Equal priority • Other options Other factors: • Initial lease-up • Future lease turnover 15 Work Type Priority 4 of 11 • Life safety / emergency response • Essential services • Operational necessity • Community resilience • Recruitment & retention • Economic or social impact Other factors: • Initial lease-up • Future lease turnover 16 Employer Partnerships 5 of 11 •Program parameters •Priority yes/no •Priority hierarchy •Cap on quantity 17 Draft Ballot Language 6 of 11 18 •August 12 ballot language resolution •Follow-up work session tbd Next Steps 7 of 11 19