SUBJECT:
Title
ADU Legislation Staff Report
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DEPARTMENT: Planning & Development
Department
PRESENTER(S): Sarah Nurmela, Planning & Development Director
First Name Last Name, Title
POLICY ISSUES:
Staff provides the Town Council with overviews of legislation that may have an impact on Town regulations, policy, or governance. This memo provides an overview of HB24-1152 Accessory Dwelling Units, a bill that is currently proposed in the House legislative session. This bill will impact land use and regulation of Accessory Dwelling Units (ADUs) within Erie.
STAFF RECOMMENDATION:
Recommendation
Receive and review Staff’s analysis.
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SUMMARY AND BACKGROUND OF SUBJECT MATTER:
The bill, HB24-1152: Accessory Dwelling Units, is intended to increase the number and ease of constructing accessory dwelling units (ADUs) throughout the region. The prime sponsors of the bill are Rep. J. Amabile, Rep. R. Weinberg, Sen. K. Mullica, and Sen. T. Exum. As noted on the full bill summary <https://leg.colorado.gov/bills/hb24-1152>, key elements of the bill include:
• Requires municipalities with a population greater than 1,000 to allow one ADU as an accessory use to a single-unit detached dwelling.
• Prohibits subject jurisdictions from enacting or enforcing certain local laws and zoning, including parking, that would restrict the construction or conversion of an ADU.
• Establishes two programs to facilitate ADUs:
- A fee reduction and grant program to supportive jurisdictions for offsetting costs incurred with developing pre-approved ADU plans, providing technical assistance to persons converting or constructing ADUs, or reducing fees and other required costs.
- Allocates $8M to the Colorado Housing and Finance Authority (CHFA) to operate and establish programs that provide affordable construction loans, buy-down of construction loan interest rates, and downpayment assistance.
• Prohibits a planned unit development (PUD) from restricting the permitting of an ADU beyond local law, or the prohibition or implementation of restrictive design standards for an ADU.
The bill is currently in the House receiving amendments. The positions on this bill are varied, with a healthy mix of support, amend, or monitor. Supporters range from cities to the AARP, AirBnB, and Conservation Colorado to Colorado Coalition for the Homeless. Those in an amend position include CML, some individual cities, and Community Association Institute. Those monitoring include a mix of real estate associations, cities, and economic development entities. Few entities have formally opposed but include the City of Brighton and Weld County over concerns of local control.
Staff Recommendation: MONITOR
Staff’s recommendation includes guidance from the following policies in the Town’s Legislative Agenda and additional context of the Town’s existing development trends, policies, and regulations.
• Ensure Funding for Affordable Housing Reflects the Regional & Local Costs of Development. The programs established by the bill would help facilitate the creation of ADUs, although would not specifically require affordable rents.
• Support Policies & Funding to Preserve Affordable Housing (Designated & Naturally Occurring) and Increase Funding, Tax Credits, & Financial Incentives that Support Local Governments in Increasing Affordable Housing Stock. ADUs allow homeowners to stay within their home while collecting additional rent or creating opportunities for multi-generational living and housing stability. The bill allocates funding to provide affordable construction loans, buy-down of construction loan interest rates, and downpayment assistance.
• Support Local Government Autonomy & Home Rule Authority. The bill requires municipalities to allow ADUs and places limits on parking and design restrictions. While this does impact local control, the requirements are consistent with the Town’s vision for ADUs.
The Town currently allows ADUs in single family zoning areas, but they may be further restricted within some of the Town’s existing PUDs and PDs. For context on ADU activity in the Town, since 2020, 11 building permits were issued, six of which have record of completion and certificate of occupancy. Additional ADUs exist within the town, built prior to 2020, but no official count yet exists. Consistent with the Town’s Housing Needs Assessment, construction of additional ADUs as an affordable housing and income option would contribute towards a more diverse housing stock in Erie. However, the ADU bill does not require income restriction. Staff does see an overall benefit to expanding options and financial resources for the creation of ADUs but must balance the bill against the broader impact on local control. Since the bill is still active, staff recommend monitoring the bill.
COUNCIL PRIORITY(S) ADDRESSED:
ü Engaged and Diverse Community
ü Prosperous Economy
ü Effective Governance
ü Environmentally Sustainable
ü Fiscally Responsible
ATTACHMENT(S):
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