Controversial Initiative Claims to Solve Colorado's Growing Pains

Colorado is one of the fastest-growing states in the U.S., and like many longtime Coloradans, Golden resident Daniel Hayes is tired of it. He's sick of the masses of people sitting in their cars during their morning commute and sliding into each other on I-70 in a mad rush to get to the mountains on a weekend, the creeping sprawl of cookie-cutter neighborhoods, the disappearing open prairies, the tons of water being sucked under tunnels in the mountains.

“It's ridiculous," he says. "It’s getting to the point where it’s like California."

So he’s trying, for the second time, to put a stop to it — or at least slow it down.

Hayes is proposing Initiative #122, which could radically alter the state's housing market to curb new development.

Hayes ran out of time to collect enough signatures for a similar petition in 2018, but he didn't lose his momentum. The initiative is going through legal proceedings, awaiting a ruling by the Colorado Supreme Court, before it can be approved for signature-gathering. The earliest it could reach voters statewide is November 2020.

The initiative, called “Limits on Local Housing Growth,” would make it easier for municipalities to impose their own limits on residential growth, and would automatically cap the number of new annual housing units (both apartments and single-family homes) in eleven Front Range counties at 1 percent of the existing housing stock for at least two years. It would guarantee that every city and county in the state could decide to limit its own residential growth by election without legislative interference or financial penalties.

Hayes is hoping that fellow Coloradans will see what he sees: a state that will be effectively altered beyond recognition if we do nothing to stop the rampant growth. "If we grow from Colorado Springs to Fort Collins, we could have a metro area three times the size of L.A. We don’t have the water for that," Hayes says. But opponents argue that it's a misguided attempt to solve real but complicated problems and could end up making them worse.

The initiative takes its inspiration from local growth limits that have been passed in Colorado and elsewhere. Hayes, who owns a few dozen rental properties himself, helped push one in his home town of Golden in 1995. Boulder has long fought growth with its open-space tax, building-height limit and residential-growth cap. Lakewood passed a 1 percent housing growth limit this summer in a special July election.

Charlotte Robinson is a longtime environmental attorney whom Hayes enlisted as a co-sponsor of the initiative after they bonded over concerns about environmental issues, traffic congestion and the population boom. “They’re just letting the builders build every inch of open space,” she says. “There are very few places that are sacred anymore.”

Though the initiative isn't officially on the ballot, it’s already caught the eye of both affordable-housing advocates and developers’ associations, who in a somewhat unusual coalition are working to oppose it. If it makes the 2020 ballot, it's likely to be up against an expensive “No on 122” campaign.

Opponents say the initiative would constrain the Front Range’s already stressed housing supply and inflate prices. “Its impact on those counties could be devastating to those in need of housing,” says Cathy Alderman, policy and communications director for the Colorado Coalition for the Homeless.

Denver's population alone grew 20 percent from 2010 to 2018, and metro Denver's population grew by 1.6 percent in the past year. Housing growth has lagged behind population growth, resulting in tight inventory.

“If you restrict growth to 1 percent of the prior year’s growth, how are we ever gonna catch up? It will just create more housing instability,” Alderman argues.

Hayes says he’s not trying to leave Coloradans homeless: “It’s obvious that unlimited growth doesn’t lower the price of housing."

The measure includes a limited exception for affordable and senior housing, each of which it allows to grow .15 percent over the 1 percent limit for general housing. The initiative defines affordable housing in an unconventional way, however — as housing units priced 30 percent lower than “the average comparable housing within the same local government." Affordable housing is usually defined by the amount of someone's paycheck that goes toward housing.

Hayes is also hoping that the old adage “If you build it, they will come,” will be true in the reverse — if we don’t build it, maybe the transplants will stay away from the state. However Teo Nicolais, a Denver real estate investor and professor at Harvard Extension School, says that's a pipe dream.

"If your hope is that [Colorado] will become so unaffordable that people will leave in disgust, then maybe you have a point," he says. Otherwise, the initiative "does not limit the number of people being born, turning eighteen or moving to the state. It limits the number of homes over which everyone in the housing market must compete."

Nicolais argues that looking at the history of this issue in Colorado, "there's no question" that housing prices will go up in an artificially constrained market. According to the Apartment Association of Metro Denver, Boulder has many of the most expensive rental markets on the Front Range. Nicolais also points to Golden, which has essentially the same character and demographics as north Lakewood; the difference between average rents in the two markets has tripled from 2006. While increased home values may be a silver mine for current homeowners, he says, it's not good news for young people scrambling to find an apartment, or lower-income families already at risk of being displaced.

Opponents argue the initiative could actually increase sprawl, traffic and environmental degradation. If home builders are limited to a certain number of units per year, Nicolais argues, there's a profit incentive to build more large, expensive single-family homes in the suburbs, which typically have bigger carbon footprints and aren't close to public transit.

Though Hayes doesn't agree with Donald Trump's assertion that the U.S. should build a wall around Colorado, he doesn't shy away from acknowledging that demographic change is part of his motivation. "I'm called a racist every time I say this, but a lot of homes are built by undocumented workers. Their kids are in our schools. If you slow housing growth, maybe they'll go somewhere else."

Both sides are well aware that the "anti-growth" rhetoric of the initiative could catch the ears of many residents who are frustrated with the status quo. “I haven’t met anybody who doesn’t want to see less development,” Robinson says. “We’re paving paradise and building a parking lot.”