Here’s a clear explanation of what I am confident will occur if/when Aspen City Council enacts Ordinance 13, their answer to fixing residential development by way of demolition allotments.
1. More intensive renovations — If people are unable to secure a demolition allotment, they will be incentivized to do projects that fall below the 40% demolition threshold. These projects will become highly intensive and impactful — more so than scrape-and-replace projects. This will cause more impact on the community than the limited projects, thereby defeating the purpose.
2. Sacrificing revenue and real estate transfer tax (RETT) — The city will be self-limiting the amount of revenue it generates as a result of fees and exactions on development projects. It will also likely eventually impact the amount of RETT collected by limiting the high-value inventory that has been most in demand recently and has generated so much of the RETT in the last few years. This will impact the primary source of funding of our affordable-housing program — the very thing you are claiming we need more of.
3. Creating speculative demand for demolitions — By limiting the number of demolition allotments, homeowners are going to speculatively apply for them and see what happens. If they get one, their property will suddenly be worth more and will likely be sold to a developer to build a new home. You are actually going to incentivize people to apply for these, sell their properties, which will eventually be demolished, when they might not otherwise have been considering doing so.
4. Increased costs/values of housing — The rising tide will float all ships, and all free-market housing will increase in value once you limit the supply of the product most in demand.
5. Loss of jobs and economic opportunities for Roaring Fork Valley residents — Reduced construction activity will result in lost opportunity, just as it seems that we’re entering a national recession. Engineers, architects, construction workers, city employees, etc., will all experience less work opportunity.
The Aspen Times I June 20, 2022