This post follows up on a post from August about a citizen initiative to limit residential growth in Lakewood, Colorado.

In Lakewood, Colorado’s fifth largest city, citizens associated with Lakewood Neighborhood Partnership submitted a petition for a “strategic growth” initiative last July. The initiative aims to limit the growth of residential housing units to 1% annually, and would require that the Lakewood City Council approve all projects with forty or more housing units. The unelected planning commission currently has final decision authority over multifamily site plans and subdivisions in Lakewood.

The proposed ordinance is very similar to ordinances that have been in effect in Boulder since 1978 and in Golden since 1995. The initiative contains a system of “allocation pools” to distribute housing unit permits to individual projects, and “banking plans” to accommodate projects with multi‑year build outs. At the beginning of every year, the city will estimate the number of dwelling units which exist on December 31 of the prior calendar year by dividing Lakewood’s population by average household size. Finally, divide that figure by 100 (1% growth), and that’s the “allocation” of permittable housing units for the year.

For example, the U.S. Census estimates Lakewood’s population (as of July 2015) to be 152,381 with average household size of 2.30 persons. If the initiative were in effect in 2016, the allocation would have been 663 housing units (152,381 ÷ 2.30 ÷ 100). Looking at Census figures for population growth, Lakewood gained 2,012 people in 2016, which would have required approximately 875 housing units. That’s a shortage of almost 25%. In 2017, the city actually issued building permits for a total of 924 residential units.

The Common Sense Policy Roundtable, a business‑sponsored think tank, released a report in October 2017 that warned the Lakewood initiative would result in the “displacement” of as many as 4,100 households over the next ten years.

Under the proposed ordinance, developers of projects with multi-year build outs would need to submit a “banking plan” that outlines how many units their project will contain, and over how many years those units will be rolled out. The planning commission must approve banking plans for projects of more than 40 units. However, the planning commission’s approval does not bind city council, which retains authority to approve any commitment of future allocations, and the approval of a banking plan does not create a vested property right to develop banked units.

Proponents submitted their petition to the City Clerk in July expecting that voters would decide on their initiative in the 2017 election. The clerk verified the signatures, but Steve Dorman, a conservative activist in Lakewood, challenged the signatures on the basis that the proponents did not adequately advise signatories about the contents of the initiative. Following two days of administrative hearing in August and September, the City Clerk found in favor of the petitioners, clearing the initiative for the November ballot. Then in October, Dorman challenged the clerk’s findings in Jefferson County District Court under Colorado Rule of Civil Procedure 106(a)(4). Based on the most recent filings in Dorman v. Lakewood, the trial court is probably a few months away from reaching the merits of case, but a Rule 106 review gives the government—in this case City Clerk—the benefit of a deferential standard of review. Even if Dorman prevails, the proponents of the Lakewood strategic growth initiative could re‑circulate petitions before the deadline in August.

The Colorado Supreme Court (the “Court”) has now weighted-in on the requirements for foreign courts to create enforceable charging orders against Colorado LLCs.  In JPMorgan Chase Bank N.A. v. McClure (2017 CO 22. No. 15SC816 (Colo. 2017)), the Court ruled that to be enforceable, foreign charging orders against a Colorado LLC must be either (i) procedurally domesticated in Colorado, or (ii) issued by a court with proper jurisdiction over the LLC or the membership interest in question. Continue Reading Enforcing Foreign Charging Orders against Colorado LLCs

 

Last week the U.S. House of Representatives passed a bill that seeks to delineate what causes a commercial real estate loan to be classified as a “high volatility commercial real estate loan,” or, as it’s more commonly referred to, as a “HVCRE loan.”  Since the rule regarding HVCRE loans was promulgated, there’s been much debate and confusion around that fundamental question.  A synopsis of HVCRE loans and the implications of HVCRE classification can be found here. Continue Reading House Passes Bill to Clarify HVCRE Rule

On Thursday, the Denver Election Division released the final unofficial vote totals for the 2017 municipal election, and it appears that Initiative 300 will pass with 54% of the vote.  We discussed the Green Roof Initiative in a post on October 24, but now that the measure has passed, we need to take another look at how its requirements will affect real estate development in Denver moving forward:

  • The Ordinance only applies to buildings of 25,000 square feet or more of Gross Floor Area, a term defined in the Denver Zoning Code.
  • “Industrial buildings” have a lesser coverage requirement than other buildings.
  • “Residential buildings” less than four stories are exempt.
  • The ordinance only applies to “building permit application[s]” and “site plan[s]” submitted on or after January 1, 2018. Because neither of these terms is defined in the Zoning Code, we expect the Community Planning and Development Department to provide some guidance as to which applications and site plans qualify.  When the City passed the Affordable Housing Fee in 2016, the City did not impose the fee for projects that had Concept Plans officially logged with the City by December 29.
  • The ordinance applies to all “roof replacements” for buildings with 25,000 square feet or more of Gross Floor Area. The ordinance does not define “roof replacement,” so again we will be looking to Community Planning and Development for guidance on this provision.

We will closely follow the implementation of this ordinance and provide updated information as it becomes available.

Last week, Denver voters received their ballots for the November 7 municipal election.  In addition to considering a $937 million bond issuance and a Denver Public Schools Board election that has garnered national attention, Denver voters will decide whether to mandate the construction of “green roofs” on large buildings throughout the city.  The proposed ordinance would apply to all new construction and every “roof replacement” on buildings of 25,000 square feet or more beginning in January 2018. Continue Reading Denver Voters to Decide Fate of Green Roof Initiative in Upcoming Election