Craig City Council met on Tuesday to review the city’s housing action plan in its final stages of completion, provide feedback and propose changes before the plan is adopted.

The Craig Housing Action Plan is the result of a multi-step process to gather input on housing needs and priorities in Craig and Moffat counties.

The plan was developed with the help of external consultants and a steering committee made up of local elected officials, business leaders, nonprofit service providers, developers and city employees.

Using information gathered from a housing needs assessment in 2021, the steering committee held four additional workshops to develop the action plan, including an action plan strategy workshop, a housing for employers, a workshop on the housing concept and a meeting on the spatial planning strategy.

Consultants Willa Williford of Williford LLC and Mary Coddington and Augustina Remedios of Capelli Consulting presented the final draft of the Housing Action Plan to Craig City Council on Tuesday. The action plan aims to address the specific and immediate housing needs of Craig’s workforce over the next five years.

The main problems identified in the plan are the limited supply of available housing and the lack of affordable housing for local workers. The plan says housing constraints are having a greater effect on the local economy as employers struggle to recruit and retain workers.

There is also demand from Steamboat Springs, where the local workforce has begun to look to Craig for affordable housing opportunities.

“If we don’t meet this demand for housing in the valley, it will continue to get worse and in the future the problem will be worse,” Williford said.

There are approximately 2,000 Craig residents who commute to Steamboat daily for work. This number may increase with upcoming changes to the local coal industry.

Once adopted and implemented, the plan aims to support the development of 90% of identified housing needs in the community. Accordingly, the plan calls for 75 new residences in Craig with a mix of 32-45 homes for sale and 23-36 rental units.

The consultants analyzed several city-owned parcels that could be suitable for residential development. A city-owned property near the Woodbury subdivision was explored further and used to create a concept plan of what a potential development might look like.

The action plan would use five different strategies to achieve development goals and make a new housing development more beneficial to the community.

The priority of the subdivision is to create new and quality constructions. The new units would include one-bedroom and two-bedroom units, rentals under $735 per month, and smaller homes that will serve as starter or downsizing homes.

On average, there have only been around five new building permits per year in recent years, which means that the local housing market is not keeping up with demand.

Given that there is a gap between total construction costs and recommended rental and sale prices for essential workers, the plan suggests that community investment will be needed to accelerate the housing market.

Williford explained that overall the plan focuses on increasing the number of units in Craig, so it is not focused on developing traditional low-income housing. A top priority is to develop a diversity of affordable price ranges for different income levels.

The action plan defines affordable housing as when the household does not spend more than 30% of its income on housing costs. For example, units could be considered affordable housing in the 60-80% range of regional median income (AMI), or $39,720-$52,960 for a three-person household.

“One of the things in our recommendations is to really try to create movement within your housing market,” Williford said.

Units are designed as starter houses and downsizing houses because that is what the target market needs the most. The theory is that many houses are under-occupied by older people or single members of the community who can live alone in a larger house but are unable to sell because there are no smaller units available. .

Council Member Tom Kleinschnitz mentioned that several local hotels have been taken off the market for short-term accommodation, but this is only a short-term solution. Having more one- and two-bedroom units available on the market would also allow for transition from short-term to long-term housing.

Council member Sean Hovorka expressed concern that the timing of the completion of the action plan falls on the same timeline of significant changes in the employment industry with the closure of power plants in coal and electric, which could flood the market with 75 new units just as industrial workers could sell their homes to work in other fields.

Changes to the local workforce were a major talking point during the workshop sessions, but the consultants said they don’t expect demand to slow down.

Williford also said the proposed units would not hit the market all at once, as development would take place over the next five years.

“We also said in the needs assessment, ‘Let’s take this slowly and keep reassessing,'” Williford said.

The steering committee is still exploring potential partnership opportunities with the Yampa Valley Housing Authority to deliver on some of the housing goals detailed in the action plan.

Another opportunity, the consultants say, would be to consider expanding the Moffat County Housing Authority, which currently has a limited focus on housing for the elderly.

Williford said housing authorities across Colorado are geared to meet community needs that aren’t met naturally by local housing markets.

The action plan provides flexibility in how housing goals will be achieved. Board members will review the plan and strategies before the plan is presented for adoption in May.