NEDERLAND — In the midst of the Town of Nederland’s efforts to provide affordable housing for new residents, its workforce, and for aging adults, Town staff and the Planning Commission have been working on the municipal code. One important question continues to be raised: What does “affordable” mean? 

Currently in Nederland, housing earns the definition of affordable if a household with an annual income between 30% and 60% of Boulder County’s Area Median Income (AMI) can afford it. AMI is the calculation based on regional income rates used to determine the fiscal parameters for affordable housing programs.

But, as the Planning Commission discussed in length March 25, this calculation does not necessarily equate to true affordability for those hoping to live, work, and age-in-place in the mountains. 

“If you’re in housing that is supposed to be affordable and it’s at 60% of the AMI, that means that you have to make nearly $75,000 a year to qualify for affordable housing,” Planning Commission Chair Jim Reis said after doing the math. “We are actually higher as a community than all of Boulder County—it surprised me.” 

Town Manager Jonathan Cain reported data from the U.S. Census Bureau’s American Community Survey five-year estimate—for 2020 to 2024—showing the median household income in Nederland is approximately $122,000. 

Commissioner Mike Dye joined Reis in crunching the numbers. From a rental perspective, 30% equates to $915 monthly rent, Dye noted, and 60% AMI equates to $1,830. 

“So that means that a one-bedroom apartment can theoretically be rented out for $1,830 and qualify for affordable housing,” Dye said. 

As the Town works to meet its commitments to Proposition 123—the program that provides municipalities with access to tiered funding from the Department of Local Affairs (DOLA) for affordable housing projects—Commissioners have been working on adopting Fast-Track Review processes for affordable housing applications.

The Commission continues to work on drafting code amendments for the Board of Trustees (BOT) to review and give a final vote on later this year. This work brings Nederland closer to its baseline goal for Proposition 123 of establishing 13 affordable housing units by December 31 of this year. 

While discussing Proposition 123, the 2022 Housing Needs Assessment, and recent ordinances pertaining to Planned Unit Development applications, the subject of what “affordable” means in Nederland kept being raised—though, according to Cain, the Commission might not necessarily be the right group to address it. 

“The policies and decisions, such as how we set AMI and what AMI is, those are decisions of the BOT,” Cain reiterated to Commissioners, “but I think that your role as an expert body in making recommendations is a really critical thing here.” 

But, Cain said, it's an important conversation to have.

“That’s teachers and firefighters in our community who don’t have housing,” Cain said, referring to that 30% to 60% AMI metric. “A lot of my staff, including myself, right now can’t afford to live here.” 

Commissioner Dye continued to provide additional context, stating his own research via apartments.com, where he found a listing for a two bedroom apartment at Nederland’s Tungsten Village for $3,200 a month.  

Cain detailed the “complicated balancing act” that Tungsten Village operates under, as they use a salary-based calculation for rentals while also utilizing a state law that allows them to “income-average.” However, the explanation did not quell Commissioners’ concerns about the state of affordable housing in Nederland. 

“How do we come up with something that’s actually reasonable?” Dye asked. “Something that regular people living in this community would consider affordable?” 

Though he reiterated that the policy matter of changing Nederland’s AMI calculation for affordable housing was a BOT decision, Cain listed the many angles being examined by Town staff in order to tackle the various aspects involved in the discussion. Cain stated that this was much deeper than just breaking down AMI into percentages. 

From inclusionary housing ordinances and Accessory Dwelling Unit (ADU) policies, to Boulder County Housing Authority grants and aging-in-place programs offered by the Northwest Colorado Council of Governments, the Town of Nederland is continuing to analyze opportunities for developing affordable, workforce, and senior housing, as well as affordable commercial real estate.    

Ordinance 888, establishing Fast-Track Review processes for affordable housing applications, is set to hit the BOT’s agenda soon. Additionally, the Town is pursuing a major multi-million dollar grant opportunity, which could provide the Town the resources to develop “pre-fab” ADU designs, an ADU Financial Assistance Program, and ADU education and technical assistance. 

“What we’re doing is intervening into the market because the market isn’t able to provide that service,” Cain said about the Town’s efforts to improve affordability. “When we do that we want to think carefully about what those interventions are.” 

Cain concluded by stating that the best strategy to address the Town of Nederland’s looming affordability crisis is to provide a range of options, and not to ignore the need for housing diversity. 

“What happens in a community that’s housing-constrained is that folks end up staying in housing that they might otherwise not, so as you build a supply that’s adequate across that continuum of housing—which does include higher-end and lower-income housing—you end up balancing out the whole community, and that’s the goal.”