Boulder commercial community benefit regs sent back to drawing board

BOULDER — Property affordability in Boulder is not only an issue for residents, but also for business owners.

Recognizing this reality, city leaders tasked planning staff with drafting a set of rules to help incentivize the creation of below-market-rate commercial spaces.

The concept, known as phase two of the community benefit ordinance, would allow builders to exceed certain height — up to 55 feet — and density restrictions should they set aside at least 5% of square footage at 50% of the market rate rent or 7% if rents are 75% of what the market demands. (Phase one of the community benefit regulations refers to incentives for affordable housing rather than commercial space. Staff has been in the process of crafting these rules since 2018.)

“Like permanently affordable housing, the space would be deed restricted to have a reduced rent rate,” Boulder planning director Jacob Lindsey said in an email. “Further, in lieu fee contributions could be accepted for the space if specific criteria were met where below market rate space may not make sense on a site. These requirements would apply to a project that is more than 50% non-residential above the ground floor.”

While members of the City Council and the Boulder business community applauded the idea behind the ordinance, which was introduced on first reading this week, many found the proposal overly complicated. 

“The approach they were taking we found to be too obtuse,” Boulder Chamber president John Tayer told BizWest.

Tayer wondered what would happen when a group outgrows the criteria it met to be eligible for below-market space. Would the business have to uproot and find a new home?

“You don’t want to penalize companies for being successful.”

Members of the council apologized to city staff this week for what could be perceived as a lack of guidance. 

“We asked for a complicated ordinance,” Councilwoman Rachel Friend said. “… Some of you may want to throw things at the end of this call.”

Staff was tasked this week with going back to the drawing board to draft a simpler ordinance that spells out exactly what cash-in-lieu fees can be used for and where in the city developers could be eligible to apply for a height variance. That new language is expected to be introduced at the July 13 City Council meeting. 

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BOULDER — Property affordability in Boulder is not only an issue for residents, but also for business owners.

Recognizing this reality, city leaders tasked planning staff with drafting a set of rules to help incentivize the creation of below-market-rate commercial spaces.

The concept, known as phase two of the community benefit ordinance, would allow builders to exceed certain height — up to 55 feet — and density restrictions should they set aside at least 5% of square footage at 50% of the market rate rent or 7% if rents are 75% of what the market demands. (Phase one of the community benefit regulations refers to incentives for affordable housing rather than commercial space. Staff has been in the process of crafting these rules since 2018.)

“Like permanently affordable housing, the space would be deed restricted to have a reduced rent rate,” Boulder planning director Jacob Lindsey said in an email. “Further, in lieu fee contributions could be accepted for the space if specific criteria were met where below market rate space may not make sense on a site. These requirements would apply to a project that is more than 50% non-residential above the ground floor.”

While members of the City Council and the Boulder business community applauded the idea behind the ordinance, which was introduced on first reading this week, many found the proposal overly complicated. 

“The approach they were taking we found to be too obtuse,” Boulder Chamber president John Tayer told BizWest.

Tayer wondered what would happen when a group outgrows the criteria it…