What factors should a local government consider in developing a baseline?
The baselines developed by localities should illustrate the amount of rental and for-sale housing that could be rented or bought by households at their selected income limits. In selecting an income limit, local governments may want to select a limit that most appropriately reflects their economic condition and housing needs.
In determining whether currently available should be adjusted, or complemented by or replaced with local data. Localities should consider the extent to which the already available data can be adjusted to account for changes such as inflation or mortgage rates, along with whether the cost of collecting and analyzing their own data is practicable and fits within the statutory requirements.
Should a baseline consider market data such as home and rental listings?
It could, but the baseline should be representative of a period of time (for example, all of 2022) and not a point in time (for example, March 10, 2023). This is because baselines are connected to affordable housing commitments and goals for annual increases in affordable housing stock overall; the amount of housing listed for rent or sale on any given day is relatively small and designing a baseline around this could result in artificially low and unambitious goals.
Should an affordable housing baseline include housing units that are not subsidized?
Yes, baselines must consider both subsidized and unsubsidized housing stock. For this purpose, housing is defined as affordable based on the households it is affordable to. Whether a unit receives, or has received, subsidy from a funder such as the U.S. Department of Housing and Urban Development has no impact on whether it is included in a baseline.
Why does a city or county have baseline reference estimates that differ, even if they are for a single jurisdiction?
Baselines may be calculated with three types of income limits, the Area Median Income of a city or county’s own county, the Area Median Income of an adjacent county, or the state median household income. The chosen income limit determines whether rental or ownership units are affordable at a given rent or value level. The higher a selected income limit is, the more housing will be considered as affordable within a jurisdiction.
Can the affordable housing funding programs created by Proposition 123 serve households that have an income above of the limits described by the Division of Housing?
No, the income limits established for participants in the programs were explicitly written in Proposition 123 and are now codified in state statute. These income limits can only be changed through an amendment by the Colorado General Assembly or by another proposition.