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The HBA Advocate Newsletter | January 3, 2023


January 3, 2023

Commerce City Council Passes Metro District Moratorium

On December 19, the Commerce City Council approved a 12-month moratorium on the use of metropolitan districts for residential development within the municipality on a 5-2 vote following the resignation of Councilmember Rick Davis and Council member Oscar Madera absent from the hearing that evening. While the HBA of Metro Denver strongly opposed the proposal and offering written and verbal testimony to that effect, the measure, as we widely expected, was approved.

Metro districts in Colorado are an important financing tool that provide a cost-effective way to fund critical infrastructure within new communities in a manner that keeps home prices attainable for aspiring homeowners.

The HBA of Metro Denver had been working diligently with the City Council, City Manager and other municipal staff to update the City's model service plan governing metro districts to alleviate some Council member's concerns and still maintain the viability of this important financing tool going forward. Unfortunately, due to the recent resignation and replacement of Council members Meghan Grimes and Rick Davis, the City Council at the direction of Mayor Ben Huseman has decided to pursue a citywide ban instead. While it appeared that the mayor had the votes necessary to impose a new moratorium, it was important that our industry continued to voice our concerns over this irresponsible proposal. The HBA's comments letter to the City Council is available here.

City of Denver Considering Wage Theft Ordinance

Last month, members of the Denver City Council introduced a wage-theft ordinance that would directly impact residential construction within the municipality. While the HBA of Metro Denver strongly opposes wage theft as a manner of principle and believes common-sense laws and regulations ought to be put in place to prevent this abuse, a number of provisions within the proposal will only hurt our industry and job growth within the City.

Our biggest concern is the ability for aggrieved parties to file claims against upstream contractors that knew about and had nothing to do with the infraction in question. While it is desirable to find ways to more quickly and easily collect on wage-theft claims, it is not appropriate, fair or just to require law-abiding companies to pay for wages not paid by another company.

While the perceived unfairness of the proposal is palpable, this will also create a number of unintended consequences that will hurt our industry at a time when a number of extenuating circumstances are already imposing exceptional challenges.  To protect themselves from potential wage theft claims by merely being "up the chain," many general contractors and first-tier specialty contractors will start to require a bond from lower tier specialty contractors to be able to work on a project. These bonds would help a general contractor and first-tier specialty contractor mitigate risk and gain reimbursement from the bonding company of the lower tier specialty contractor - in the case of a wage claim brought by the auditor. However, it will be smaller and minority-owned construction firms that will be most adversely impacted, since they are the most likely contractors to not be able to qualify for a bond or be able to afford the cost of the bond, and then will likely have less work in the future under this scenario.

While this and other concerns caught the HBA of Metro Denver's attention, we were also disappointed at the lack of engagement with the greater business community before this proposal was brought forward. The HBA of Metro Denver has recently met with the bill sponsors and appropriate staff to see if amendments can be added before a final ordinance is voted on. At the very least, the HBA of Metro Denver would like to see proper notification and right-to-cure provisions added to the bill to make sure contractors who were not participants in the violation are at least protected from additional penalties associated with the complaint.

City of Denver to Consider Fast-Tracking Electrification Requirements

Last month, the Denver City Council declined to ban natural gas connections in new homes, despite requests made by environmental advocates. While the HBA of Metro Denver supports the Council's decision, we are fully aware that Council can amend the proposed building codes at anytime and may decide to do so at a later date. The HBA of Metro Denver opposes an electrification mandate for new homes in 2023 and will make sure the industry's voices are heard.

It is important to note that, the City of Denver implemented a comprehensive process that offered an opportunity for stakeholder involvement and input that the homebuilding design and construction industry participated in, along with the environmental community. The residential-construction industry has been planning future development in good faith that the new code requirements would reflect the timelines established by the City and its code committees.

If the interest groups requesting a last-minute amendment to the code wanted to require all-electric new homes in 2023, they should have made their case through the stakeholder process that had been established. Rushing timelines and making last-minute changes to placate one interest group is not a good way to implement new policies and programs - and always ends with less than satisfactory results.

In order for the transition to all-electric homes to be successful, it needs to be done in coordination with an industry that has had proper notification and is adequately prepared. By moving the date forward by an entire year, it eliminates the staged planning and ability for builders to sort through a new supply chain and make adjustments where necessary. Builders also need time for their distributors to plan accordingly, for their contracted trades to get in alignment with the new code requirements, and for the builders themselves to sort through all the new criteria and find pathways toward equivalent cost efficiency. That just does not happen in a couple of months, and the entire industry needs the current timeline to properly plan ahead.

Housing attainability across the Front Range has only become more elusive given our recent environment of rising interest rates coupled with rampant inflation. Adding additional uncertainty through last-minute code changes into an already precarious housing market will only increase confusion, cause needless delays and unnecessarily increase the cost of housing for Denver residents.

The HBA of Metro Denver will continue to keep you updated on any new developments related to this issue.

2022 HBA Advocacy Efforts Had $130 Impact on Housing Policy

Throughout last year, The HBA of Metro Denver Advocacy team has worked tirelessly to make sure developers, builders and associate members have the most favorable business environment possible to bring new homes to market. The HBA of Metro Denver staff and our members have collectively combatted ballot questions, detrimental changes to metro districts, construction-tax proposals, inclusionary-zoning ordinances, fee increases and many other issues that directly impact our industry's ability to bring much-needed attainable housing opportunities to Colorado residents. While much of our collective efforts cannot be quantified, we have achieved the following tangible results that will help make the essential work of building homes easier and more affordable.

Quantifiable savings to our builders and industry over the past 12 months include:

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HBA of Metro Denver Issue Tracker
Questions on what is happening in a specific city or county? The HBA is regularly monitoring the council and board activities in every political subdivision in the metro Denver area. Our Issue Tracker offers a great resource to learn about the issues being deliberated with links to agendas, packets and ordinances. The HBA of Metro Denver HBA Issue Tracker is available  to all members here.


HBA is looking for Members to Participate in Advocacy, Regulatory and Technical Committees in 2023

As a volunteer-driven organization, the HBA's Jobsite Safety CommitteePermitting CommitteeRegulated Utilities Committee and Stormwater Management Committee help guide the HBA's events and activities throughout the year. Consider joining one - or more - if you want to build strong, long-lasting relationships and make a difference to your fellow HBA members, while sharpening your leadership skills. Please visit the HBA website for more information or reach out to Morgan Cullen if you are ready to participate.

Thank you to HBA's Organizational Partner:

Contact Connie Dahl for more info on becoming an HBA Sponsor!

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