'State of Our Cities & Towns' report shared

STATEWIDE— This year, the Colorado Municipal League (CML) released its 10th edition of the State of Our Cities & Towns report.

The survey asked municipalities to look back at the challenges they encountered in the aftermath of the Great Recession and the successes they have had in the face of this adversity. CML also asked its members to identify the emerging issues they see on the horizon and the opportunities they have to address them.

Of the 159 Colorado municipalities responding to the survey, several were from the San Luis Valley including Alamosa, Blanca, Center, Crestone, Monte Vista, Saguache and South Fork.

Key findings from the report included:

• Most municipalities have better financial health today than just before the recession. The most common lasting impacts of the Great Recession are delayed maintenance of capital improvement projects and lagging economic growth; one-quarter of municipalities experienced no lasting impacts from the recession.

• Feelings about the local economy and municipal revenue have improved steadily since 2011. On average, municipalities thought their local economy was better than the benchmark of the previous year. 

• The greatest challenges municipalities face are unfunded street maintenance and improvement needs, lack of affordable housing, tight labor markets, unfunded water/wastewater improvement needs, increased health insurance costs, and increased demand for municipal services. 

• Major challenges have varied over the years. From 2008 to 2011, common major challenges were slow growth in tax revenues, adverse local economic conditions, declining state funding, and decreases in tax revenues. From 2012 to 2015, common major challenges included unfunded street maintenance and improvement needs, federal and state mandated expenditures, and decline in federal funding. From 2016 to 2018, common major challenges included lack of affordable housing, tight labor market, and increased demand for municipal services. On average, unfunded street maintenance and improvement needs was the most common major challenge across years.

• Most municipalities have a positive financial outlook for the next five years. Only one in 10 municipalities has a negative outlook for the next five years; these municipalities are all small or mid-sized. 

• Budget constraints and housing affordability are the two most common challenges municipalities expect to face in the next five years.

Housing a challenge

One enduring challenge stood out: Housing. Twenty-six percent of respondents answered that it was “somewhat worse” than 10 years ago, and 17 percent stated it was “much worse.” Only 3 percent said that it was “much better.” Focusing in on the past three years alone, not a single municipality responded that housing had gotten “much better,” and 56 percent selected “somewhat worse” or “much worse.”

Even these numbers, however, fail to fully encapsulate the concern felt by public officials around the state about the lack of affordable housing options in their communities. Respondents described the supply of housing as “insufficient,” “unattainable,” or “in disrepair,” while they described the need as “critical,” “significant,” and “desperate.” Overall, as one municipality reported, the picture is “bleak.”

Given the severity of the housing crisis, it is not only starter homes that some communities are struggling to provide. Municipalities mentioned the need for housing throughout the price spectrum. Multiple respondents lamented the high cost of water, shortage of skilled labor, and proliferation of short-term rentals exacerbating the issue.

Rural cities and towns have reported difficulty attracting developers willing to build in their area even as the demand is growing, and many existing homes have been neglected or abandoned.

A lack of affordable housing options has cascading effects. Ultimately, housing challenges can contribute to slower economic growth, as reported by 40 percent of respondents.

The increase in housing costs also has had a noticeable impact on the number of homeless individuals within communities around the state. While only 20 percent of respondents reported an increase in homelessness directly connected to affordable housing challenges, 37 percent reported an increase in homelessness in the past three years due to any factors, with that number skyrocketing to 95 percent in municipalities with a population greater than 25,000.  This increase has left municipalities struggling to find enough resources to provide services for homeless individuals.

In the face of these challenges, municipal leaders are taking action. Forty-two percent of respondents either currently have a housing affordability plan or plan to create one in the next three years, and 61 percent work with a local or regional housing authority. Cities and towns are fast-tracking land use applications and waiving permit fees on affordable housing projects, zoning for tiny homes, and entering into agreements with developers to place deed restrictions on certain properties.

CML also has committed to facing the housing crisis head-on as part of its commitment to serving the cities and towns of Colorado. The 2019 State of Our Cities & Towns survey provided the data to confirm that cities and towns need support on this topic. Earlier this month, CML released a magazine dedicated to affordable housing and produced a podcast on homelessness. Complete survey results and resources can be found at www.cml.org/state-of.

CML is a non-profit, non-partisan organization established in 1923 and represents the interests of 270 cities and towns. For more information on the Colorado Municipal League, please visit www.cml.org