Proposed Initiative Would Limit Residential Growth on Front Range

Proposed Initiative Would Limit Residential Growth on Front Range

Feb 11, 2020

Client Alert

Brownstein Client Alert, February 11, 2020

An unprecedented number of citizen-initiated ballot measures are making their way through Colorado’s process in advance of the Nov. 3, 2020, election. To date, 257 ballot measures have been submitted for the 2019-2020 election cycle. By contrast, only 185 total measures were filed during the 2017-2018 cycle.

One measure of particular interest is Proposed Initiative 2019-2020 #122, which seeks to limit residential housing growth by enacting a 1% annual cap on the number of housing permits issued in 11 Front Range counties. The measure would allow housing permits for senior housing and affordable housing to exceed the 1% cap by 0.15% each, meaning under no circumstance would annual residential housing growth be allowed to exceed 1.3% annually.

The measure allows voters in local jurisdictions to amend or repeal the cap starting in 2023, but unless amended or repealed keeps the cap in place indefinitely. The measure also allows local governments to enact even stricter growth limits, and overrides municipal home rule authority by allowing countywide growth limits to apply uniformly across the county.

Last, the measure enacts a special set of rules for growth initiatives, specifying the number of signatures needed to put citizen-initiated growth measures on the ballot and a unique challenge process.

Proposed Initiative #122’s growth restriction mirrors the 1% residential growth restriction passed in 1995 by voters in Golden, a municipality near the unincorporated part of Jefferson County where one of the initiative’s proponents, Daniel Hayes, lives. Boulder has a similar residential growth restriction, which was first passed in 1976. While these local restrictions have succeeded in limiting residential growth in Boulder and Golden, they have also contributed to increased housing costs.

For example, the average home price in Boulder moved above $1 million  in 2016 and the community struggles with congestion because many people who work in Boulder commute in from surrounding communities not subject to the restriction where housing is more affordable. Just last year, Lakewood voters likewise voted to cap residential growth to 1% per year. Now, for the first time, voters across Colorado may be asked to decide whether to impose a growth restriction region-wide.

For his part, proponent Daniel Hayes has said he will spend up to $400,000 to get Proposed Initiative #122 on the ballot in November. He has also said his motivation is to drive people away from Colorado, particularly undocumented immigrants. This is his second attempt. He succeeded in receiving title approval for two similar proposed initiatives during the 2017-2018 election cycle, but did not attempt to collect signatures on either of those measures. This go-around, he has contracted with two signature collection companies and signature gathering is underway. Proposed Initiative #122’s other proponent, Charlotte Robinson, is an environmental lawyer and is also concerned about the population boom as well as traffic congestion.

In terms of economic impact, the statutorily required initial fiscal impact statement prepared by Colorado Legislative Council staff indicates the fiscal impact Proposed Initiative #122 would have on local governments, and on the state as a whole, would depend on growth patterns and market forces. On the one hand, local governments in growth-restricted counties would receive less revenue from building permit fees, property taxes on new construction, and use taxes for building materials. To the extent growth is redistributed, local governments in non-growth- restricted counties would receive more revenue from those sources.

Statewide, Proposed Initiative #122 would impact the distribution of construction employment, retail trade, and population within the state. The state fiscal impact analysis does not address other effects the measure could have, such as traffic redistribution, and it does not address indirect or induced impacts.

Other than generally discouraging growth and investment by the real estate and development community, it is difficult to predict the precise impact that Proposed Initiative #122 could have. In Lakewood, where a similar growth restriction was approved by the voters in June 2019, the Lakewood City Council only recently passed a resolution implementing the measure, more than six months later, because the language of the local initiative left several questions unanswered. Similarly, if passed, Initiative #122 will likely be followed by a period of uncertainty while the affected local governments determine how to implement its provisions in their communities.

To qualify for the ballot, Hays and Robinson must collect 124,632 valid signatures before June 5, 2020. If they succeed, the following language will appear on the Nov. 3, 2020, ballot:

Shall there be a change to the Colorado Revised Statutes concerning limitations on the growth of privately owned residential housing, and, in connection therewith, permitting the electors of every city, town, city and county, or county to limit privately owned residential housing growth by initiative and referendum; permitting county voters by initiative and referendum to limit privately owned residential housing growth uniformly within the county, including all or parts of local governments within the county; for the cities and counties of Broomfield and Denver and for the counties of Adams, Arapahoe, Boulder, Douglas, Elbert, El Paso, Jefferson, Larimer, and Weld: (1) limiting privately owned residential housing growth countywide to one percent annually for the years 2021 and 2022 and for subsequent years unless amended or repealed by initiative and referendum starting in 2023; and (2) requiring said counties and cities and counties to allot permits to build new privately owned residential housing units to ensure that the annual growth rate in the total number of such units does not exceed one percent in the years 2021 and 2022; permitting an additional fifteen hundredths of one percent additional growth each for affordable and senior privately owned residential housing growth in said counties and cities and counties when such housing is either affordable housing or senior housing; and establishing procedural requirements for initiatives and referenda concerning proposals for local governments to regulate the growth of privately owned residential housing?

Keep an eye on Proposed Initiative #122 and all the other citizen-imitated ballot measures that are in the pipeline for the 2020 election by visiting Brownstein’s Colorado Ballot Initiative Tracker.

 

This document is intended to provide you with general information regarding Proposed Initiative #122 in Colorado's 2020 election. The contents of this document are not intended to provide specific legal advice. If you have any questions about the contents of this document or if you need legal advice as to an issue, please contact the attorneys listed or your regular Brownstein Hyatt Farber Schreck, LLP attorney. This communication may be considered advertising in some jurisdictions.

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Caitlin Quander Shareholder T 303.223.1233 cquander@bhfs.com
Charles J. Smith Shareholder T 303.223.1289 cjsmith@bhfs.com
Carolynne C. White Shareholder T 303.223.1197 cwhite@bhfs.com