Revisionsing of the Afforadable Housing Program Should Be a Priority Now

For Immediate Release Contact: Tim Semrau Tuesday, March 13, 2007 925-2027 [email protected]

Tim Semrau Proposes Bold and Innovative Change in Aspen’s Affordable Housing Program

Mayoral Candidate calls for owners to benefit from strong real estate market.

Aspen, CO…After years of discussions with housing officials, Aspen Mayoral candidate Tim Semrau is proposing a sweeping change in the city’s Affordable Housing program. Revising the Affordable Housing Program should become a government priority, says Semrau. He is calling for new deed restrictions that involve increasing the sales cap percentage and as well as the amount that owners can recoup for capital improvements. The money to keep the program affordable for future tenants would come from the city’s existing housing fund surplus.

Semrau notes that the city’s Affordable Housing program was originally conceived to provide “starter” housing for workers in Aspen to get a foot in the door of the community, but now it has evolved into lifelong housing for most working people who want to spend their lives here. There are few opportunities today for those people to move into free market housing or even larger deed restricted housing due to the high cost of free market housing and the lack of land to build much more affordable housing.

“This paradise we call Aspen has been created by all the people living here, and those living in deed restricted housing should be able to share in the benefits of the American home ownership dream,” says Semrau. In the past four years, the free market has appreciated by 14%/year or 56%. “That appreciation has put millions of dollars into the affordable housing fund. I believe that the people who created the desirability for that appreciation should have some of its benefits,” says Semrau.

Semrau Announces Affordable Housing Reform Page Two Semrau is proposing a plan that would utilize some of that burgeoning fund without increasing the costs for future home owners.

The plan calls for the City of Aspen to offer new deed restrictions to owners of all affordable units which reflect the following changes; 1) An increase to a 5% appreciation cap should be implemented starting 1/1/08, replacing the existing variety of lesser rates. Each existing owner would have the option to agree to the new standardized deed restriction for it to take affect. 2) The capital improvement cap would increase from 10% to 20% of the value of each unit. 3) The city would ensure future affordability at the time of sale by retaining the right to “buy down” or reduce the purchase price to subsequent deed restricted owners through a payment at closing.

The city housing development fund is scheduled to have a surplus of $35 million in 2008 and a surplus of over $100 million in 2014. This explosion in funding is a direct result of the desirability of being in Aspen. There are about 900 city deed restricted units averaging about $150,000 in cost (Tim Semrau estimate). The additional 2% in appreciation can be 100% bought down at any point in the future by allocating $2.7 million per year to a buy-down fund ($150,000 x 2% x 900 units = $2,700,000). Following this formula would still leave $83 million in 2014 housing development funds available for city housing development projects.

Those who have helped create the Aspen dream should also get some benefits from their contribution,” says Semrau.