In an effort to increase affordable housing, the Lone Tree City Council unanimously agreed to opt-in to Proposition 123 with the intention of working collaboratively with Douglas County partners.

Proposition 123, a ballot measure Colorado voters approved in November 2022, authorizes the state to retain money from existing state tax revenue to support affordable housing investment, according to the Colorado Affordable Housing Financing Fund. 

The 2023 funding total is estimated to be $135 million, according to a Lone Tree staff report.

During an August city council meeting, Kelly First, Lone Tree’s community development director, said the projects and activities that can be eligible to receive funding include land banking, affordable homeownership and homelessness support. 

To be eligible to access these funds, local governments have to opt-in and commit to increasing their affordable housing stock by 3% each year for a total of 9% over three years, per a city staff presentation. They also have to create a “fast-track” development process.

As reported by The Colorado Sun, some municipalities have expressed apprehension about opting in because of the annual 3% increase requirement, saying the baseline number is too high. 

The City of Lone Tree, however, is taking a regional approach to achieve this requirement by working collaboratively with the Douglas County Housing Partnership and partner jurisdictions.

The housing partnership is a multi-jurisdictional housing authority that was formed in 2003, according to its website. It has gotten financial support from Lone Tree, Castle Rock, Parker, Castle Pines and Douglas County. 

With this regional approach, Lone Tree can work with partner jurisdictions to achieve the three-year commitment using county-wide unit counts, according to the staff report. 

“This is advantageous because the ‘baseline’ from which to calculate the increase in units would be spread out over the entire county,” the report said. 

Using this regional approach, Douglas County would be expected to have a total baseline of 11,334 affordable rental and for-sale units within the county. The three-year commitment would be to increase that by roughly 1,023 units, according to the staff report. 

A screenshot of the City of Lone Tree's staff report which shows the baseline numbers of affordable rental and for-sale units within Douglas County. …

The development forecasts from the Douglas County Housing Partnership indicate that there are 799 affordable units currently in the pipeline to be constructed throughout the county. 

Given the collaborative approach and number of affordable units already in the pipeline, Kelly First, Lone Tree’s community development director, said that she feels confident that they will be able to hit the target numbers. 

The next steps will be for jurisdictions who chose to commit to certify their baselines individually and indicate they will cooperate in the development credit, according to a city staff presentation. 

“Most, if not all, of our partner jurisdictions are currently also in the process of opting into Prop 123,” First said. 

Prior to the end of the three-year period, participating jurisdictions will execute an agreement that documents the development credit distribution method and designates Douglas County Housing Partnership as the responsible tracking and reporting agency for the cooperative, per the presentation. 

“This is, you know, a very new program,” Lone Tree Mayor Jackie Millet said. “I think it’s really good we’re engaging (and) at the table, and finding what works and doesn’t work with the program.”