“We have a deepening affordable housing problem,” Moab City Economic Development Specialist Ken Davey said during the Aug. 28 meeting. “As the service workforce expands, we are seeing more housing units converted to nightly rentals. We’re losing stock just as we bring in more people.”
“I think we’re at a critical point,” planning commission chairwoman Kelly Thornton said.
Davey presented several different options the city could consider, including commercial linkage fees, inclusionary zoning, an affordable housing overlay zone or financial incentives to developers who provide affordable housing units.
According to Davey, the city could choose to assess certain fees anytime a business comes in that is going to generate low-wage jobs. The fees would then go toward affordable housing projects to help house the workers for those jobs.
Inclusionary zoning would involve having developers either provide a certain number of affordable housing units in tandem with their developments, or they could pay a fee into an affordable housing fund, Davey said.
“For example, if a developer is putting in 40 homes, they have to either build a certain number of units or pay a fee to build a percentage of affordable homes,” he said.
Davey said the city could offer certain incentives, such as bonus densities in those areas for developers willing to build affordable units. For example, if city code allowed the developer to build no more than 40 units on a parcel of land, the city could choose to offer the developer the option of building a certain number of additional units above the 40 allowed if they also built a set number of affordable units.
Davey suggested that the city could also choose to delay certain impact and connection fees for as long as affordable housing units stay within the affordable housing bracket.
“If they become unaffordable, all those fees are due immediately,” he said.
“We can’t wait too much longer to do something,” Davey added.
Thornton warned that the solution will not be an easy one.
“The problem is multi-faceted, multi-layered and complex,” she said. “I don’t think we can afford to lose any more affordable housing.”
Planning commission member Jeanette Kopell said the problem is not just a local issue.
“Rural areas are really hurting big time,” she said. “It’s not just us. It’s a national problem, and we need to do something now.”
Thornton suggested a moratorium on construction of new nightly rental units, in addition to units converting from long-term housing to nightly rentals.
“We have a big problem with illegal nightly rentals where they don’t belong,” she said. “That’s impacting affordable housing.”
According to Moab City Council member Doug McElhaney, members of Moab City staff recently coordinated with Grand County staff and members of the Housing Authority of Southeastern Utah to look at the problem of illegal nightly rentals.
McElhaney said that out of 173 homes that fall under the vacation rental by owner status, more than 30 were non-compliant in some way.
“Some of them don’t have business licenses, some aren’t paying their transient room taxes, and some of them are in the wrong zone,” he said.
“We have a very limited number of affordable rentals anyway,” he added. “If you turn them into nightly rentals, it cuts that down even further.”
Thornton suggested a moratorium that would begin in November when development is slowing down for the winter months anyway. While the moratorium would only be temporary, Thornton said it would allow the city some time to address the issue.
“Sometimes you don’t have an immediate answer,” commission member Wayne Hoskisson said. “This gives you time to come up with an answer.”
Commission member Laura Uhle wasn’t convinced that a moratorium would solve the issue. She warned that the public may see it as a negative move.
“I’m a huge proponent of doing what we can for affordable housing,” she said. “I don’t know how stopping overnight rentals is going to help us achieve this.”
However, Davey noted that the city has seen an increase in proposals to convert monthly rentals into nightly rental units.
“The problem will deepen,” he said. “A temporary moratorium on permits will give us time to come up with a real solution.”
The planning commission will spend the next several weeks drafting a proposal to the Moab City Council regarding the issue.