DENVER | Main Development Thread #7

[TakeFive]

Originally Posted by bunt_q

Denver collects taxes that would normally be collected separately by a city and a county, so it is true that Denver has more categories of tax flowing its way than, say, Littleton. It helps with formula funding too, for example, motor fuel taxes, where Denver gets a city and county share. Denver also has more obligations. Denver is doing the things that Arapahoe County does; Littleton is not.

Thanks; that's a Big Help. I can recall reading about a tax (I think it was the fuel tax) and wondering if Denver got both a city and county portion. Now I know.

As a reminder, fuel (and aviation) taxes are reserved for the state. Cities can not impose their own fuel tax.

Oddly, I've never really known or thought about what differences there might be, between city or county with respect to Denver.

Most of the differences between city and county (in Denver's case) are merely academic. At the state or even federal level usually for demographic purposes, counties are often used.

For example:

Denver is the central city of a conurbation region in the U.S. state of Colorado. The conurbation includes one continuous region consisting of the six central counties of Adams, Arapahoe, Broomfield, Denver, Douglas, and Jefferson. The Denver region is part of the Front Range Urban Corridor.

A City can not divorce itself from a county except by becoming its own City and County. From what I gather Denver has been its own City and County since November 7th, 1861.

The only functional difference I've found is Denver has both a municipal court and a county court - the 2nd Judicial District. I'd assume this was done primarily to meet state requirements. The Denver Municipal Court handles more petty or minor things as is typical of a municipal court.

Denver, officially the City and County of Denver, has only one governmental organization: "The People of the City and County of Denver" It has but one budget and all normal taxes like sales & use taxes, property taxes, various licenses and fees all funnel into the City and County budget. It's one and the same.

[gopokes21]

Originally Posted by bunt_q

Denver collects taxes that would normally be collected separately by a city and a county, so it is true that Denver has more categories of tax flowing its way than, say, Littleton. It helps with formula funding too, for example, motor fuel taxes, where Denver gets a city and county share. Denver also has more obligations. Denver is doing the things that Arapahoe County does; Littleton is not.

Not sure where the discussion on state support comes from. The state has never supported stuff like we are talking about in any meaningful way, and never will. I will remind everybody, we just voted a statewide income tax decrease.

You keep talking about a billion here, a billion there, Dallas, OKC... a billion buys you zero subway. Where is the example where a jurisdiction closer to the size of Denver has ponied up multiple billions? Closest I can think of is Honolulu, and that has gone super well...

Seattle.



3.15 miles for $1.9 billion, of which half came from FTA. Doable. Highly worth it - when you consider the urban walkable neighborhoods opened up to mass transit that otherwise couldn't be served at grade. Interestingly, all (or should I hedge and say most of?) the Cap Hills are pretty similar.

You should all stop trying to make this as hard as possible and instead expend that creativity and effort to imagine the possible. I shouldn't have to explain how the time value of money works with debt and how you have to leverage multiple funding sources for any big project. But I guess it's more fun to choke on the thought of one funding source and the world's worst public financing plan.

Meanwhile I guarantee you a billion here and a billion there will be put toward something that isn't even on the radar today.

[TakeFive]

Originally Posted by bunt_q

Not sure where the discussion on state support comes from. The state has never supported stuff like we are talking about in any meaningful way, and never will. I will remind everybody, we just voted a statewide income tax decrease.

Taxation, government finance and budgets are hard to decipher, hard to wrap your brain around. gopokes21 is not the first to have misperceptions; this has come up before.

Given Colorado/Denver residents come from many different states it's easy to bring your perceptions with you. Natives understandably don't understand how other states work.

The biggest confusion I've found in perceptions is the collection of sales taxes which is always a Big Item. Many states, like Texas or Arizona collect over twice as much sales tax as Colorado and then pass out candy to various "political subdivision." Because Colorado only collects (less than) half the sales tax rate of many states means they don't have the candy to pass out to "political subdivision" ie cities and counties.

Who Knew in such Pandemic Times

Fearing the worst in lost revenue, California instead reaped an historic tax haul, so much that they can't spend it all (by law) and will need to sock away a lot of it into their Rainy Day Fund.

Arizona also had an unexpected surplus although more modest. But looking ahead Governor Ducey is proposing a $1.2 billion income tax cut for individual earners and small businesses to be phased in over three years as part of an ongoing effort to become more competitive for jobs with the State of Texas.

I see where the State of Colorado projected "For the current 2020-21 fiscal year, revenue is expected to be anywhere from $542 million to $1.5 billion higher than prior forecasts were predicting."

Originally Posted by gopokes21

Seattle.



3.15 miles for $1.9 billion, of which half came from FTA. Doable. Highly worth it - when you consider the urban walkable neighborhoods opened up to mass transit that otherwise couldn't be served at grade. Interestingly, all (or should I hedge and say most of?) the Cap Hills are pretty similar.

That's a fair example except No they are not comparable.

Phoenix light rail has good ridership b/c it goes between downtown Phoenix and Tempe. Tempe is home to 55,000 ASU students and there's also an ASU extension of several studies in downtown Phoenix. The University of Washington has over 46,000 students. When that (tunnel) extension was opened ridership virtually doubled b/c of the University but to an extent the Cap Hill area. That will not even be close to reality in Denver.

Additionally you'd hardly be taking any "cars off streets" as you'd merely substitute bus riders for subway/light rail riders. "My" suburb to city light/commuter rail takes more cars off the street than this would.

[Agent Orange]

Originally Posted by twister244

Zoning doesn't dictate the price of the home, the market does. Right now, there isn't enough housing going up to accommodate growth. The fact these narrow slot homes are indeed selling like hot cakes means people are ok with more density city-wide, which is what exactly the city needs to accommodate ASAP if it wishes to not become another Boulder/San Francisco.

I don't think we're in disagreement. I'm saying the city should have allowed less wealthy households to bid for the land that these slots homes have been built on. The market for housing in Denver is strong, but if you liberalize zoning, parking, easement rules etc, you can allow more supply to emerge, and crucially different types of supply. Same as what Dirt was saying, I think.

Though I don't see any signs that Denver isn't already on the cusp of being the next Boulder/SF when it takes half a decade to simply decide to let garage ADUs be built one tiny neighborhood at a time. ADUs aren't enough to make a dent in this housing shortage (and they don't seem to be an efficient way to provide reasonably priced housing either), and yet even that minor reform is still pretty contentious. We'll see what the next municipal election brings.

[twister244]

Originally Posted by Agent Orange

I don't think we're in disagreement. I'm saying the city should have allowed less wealthy households to bid for the land that these slots homes have been built on. The market for housing in Denver is strong, but if you liberalize zoning, parking, easement rules etc, you can allow more supply to emerge, and crucially different types of supply. Same as what Dirt was saying, I think.

Though I don't see any signs that Denver isn't already on the cusp of being the next Boulder/SF when it takes half a decade to simply decide to let garage ADUs be built one tiny neighborhood at a time. ADUs aren't enough to make a dent in this housing shortage (and they don't seem to be an efficient way to provide reasonably priced housing either), and yet even that minor reform is still pretty contentious. We'll see what the next municipal election brings.

I think it's already too late. This article that came out today is just depressing to read.....

https://www.westword.com/news/denver-average-home-prices-up-100000-in-a-year-11892826

$100k in one year. Let that sink in for a moment.

Denver should do what Minneapolis did a couple years ago, but we all know that won't happen.

[gopokes21]

Originally Posted by TakeFive

Additionally you'd hardly be taking any "cars off streets" as you'd merely substitute bus riders for subway/light rail riders. "My" suburb to city light/commuter rail takes more cars off the street than this would.

There is literally no response for someone who thinks subway and local bus generate the same ridership in a dense urban core.

[TakeFive]

Originally Posted by twister244

I think it's already too late. This article that came out today is just depressing to read.....

https://www.westword.com/news/denver-average-home-prices-up-100000-in-a-year-11892826

$100k in one year. Let that sink in for a moment.

Denver should do what Minneapolis did a couple years ago, but we all know that won't happen.

I cracked up when I read that Westword article. Says the house is a 3,360-square-foot home. Then I looked at that photo and nearly spit up all over my keyboard.

For starters that's a view of the narrow side of the house. It's listed by some (Zillow, Trulia) as having 1680 Sq Ft while others use the higher figure which includes the full basemen (unfinished).

It's a duplex; it's a corner lot w/ 7,920 Sq Ft.; zoning is E-SU-G which isn't that useful admittedly. Not saying it's not high priced but it is two units.

Few Points:

All that helicopter money is enhancing the acceleration of values.

I see where Biden/Dems are promoting a $1.9 Trillion stimulus package. So they took a poll and it's very popular. Guy/gal calls up and says the government wants to send you free money; are you in favor or apposed. Low and behold most people like the idea. A M A Z I N G

While still relatively low, interest rates are ticking up. That will start to dampen buyers enthusiasm.

CNN recently had a good piece on migration patterns, mostly away from the NE and West Coast and where people are going.

It's a demographic problem of people moving out of some areas into other areas. Even in Phoenix where a lot of new SF homes, condos and apartments are being built, they can't keep up with the demand from those moving in. Supposedly, Denver is ramping up building homes near the airport but it's slow getting going as developments are newly entitled, needing infrastructure, etc... it takes time.

Move to the Rust Belt for affordable housing.

[TakeFive]

Originally Posted by twister244

Denver should do what Minneapolis did a couple years ago, but we all know that won't happen.

Last I read the zoning change in Minneapolis has had virtually no impact.

Look at it this way:

Even in Phoenix (except in ghetto neighborhoods) the bottom of the SF home market is close to $300,000. The top of the market is $27 million but $15 million is average high end.

I'd assume in Denver the low end of the market is at least $400,000? Top of the market looks to be $14 million but $11 million is closer to average high end. So an average of $600,000 which falls between $400,000 and $11 million doesn't sound that crazy, does it?

[twister244]

Originally Posted by TakeFive

Last I read the zoning change in Minneapolis has had virtually no impact.

Look at it this way:

Even in Phoenix (except in ghetto neighborhoods) the bottom of the SF home market is close to $300,000. The top of the market is $27 million but $15 million is average high end.

I'd assume in Denver the low end of the market is at least $400,000? Top of the market looks to be $14 million but $11 million is closer to average high end. So an average of $600,000 which falls between $400,000 and $11 million doesn't sound that crazy, does it?

It does look crazy when you look at other cities with similar qualities of life, or better urban fabric. Go onto Redfin and put a price cap of $450k and see how many listings you get in Denver. Now... Go to Chicago (or some other nice midwest city) and put that same price cap. Are you going to still tell me Denver hasn't crossed a crazy threshold? Just in individual neighborhoods in Chicago, there are more listings under $450k than there are in all of Denver. Chicago is an outlier, for sure, but it's highlighting a dirty secret people might not realize yet. At some point, the cities that everyone perceives to be hip and affordable are quickly going to become the very thing they are fleeing - over-hyped and overpriced. I am probably biased in my posting here since my job can be done remotely long term, and I have tons of family in Chicago, but there is some truth here.

And of course zoning doesn't have an immediate impact. But it does ensure for proper development in the years following. The problem is Denver didn't see this level of growth coming, which is one thing. However, they aren't taking the necessary steps to address it moving forward. Instead we have this growing underbelly NIMBY sentiment that is pitting "natives" against transplants, while the city is becoming unaffordable for middle class folks.

[TakeFive]

Source

Originally Posted by twister244

It does look crazy when you look at other cities with similar qualities of life, or better urban fabric. Go onto Redfin and put a price cap of $450k and see how many listings you get in Denver. Now... Go to Chicago (or some other nice midwest city) and put that same price cap. Are you going to still tell me Denver hasn't crossed a crazy threshold? Just in individual neighborhoods in Chicago, there are more listings under $450k than there are in all of Denver. Chicago is an outlier, for sure, but it's highlighting a dirty secret people might not realize yet. At some point, the cities that everyone perceives to be hip and affordable are quickly going to become the very thing they are fleeing - over-hyped and overpriced. I am probably biased in my posting here since my job can be done remotely long term, and I have tons of family in Chicago, but there is some truth here.

I apologize since you have family in Chicago and downtown Chicago is very nice as are many parts of Chicago, I'm sure.

But I'm also aware that most municipal bonds and state bonds are rated one notch above junk. Both the city and the state are experiencing net out-migration. Doesn't necessarily mean one shouldn't live there though.

If I were to move to the upper mid-west, especially if I had a family I'd choose Columbus OH. Their bonds are rated Triple A (like Denver) and Ohio bonds are rated Aa1 - same as Colorado's.

Honestly, I understand Denver housing prices are rather high but compared to other desirable cities "west of the Mississippi"? I'd assume SLC and Boise are still lower and ofc all the desert cities and Texas.

I don't see any benefit in re-litigating Denver Zoning. I'm more flexible than NIMBY's but less flexible that YIMBY's. But it is what is and I still believe that zoning for fourplexes would accomplish little to nothing.

[Robert.hampton]

Originally Posted by twister244

It does look crazy when you look at other cities with similar qualities of life, or better urban fabric. Go onto Redfin and put a price cap of $450k and see how many listings you get in Denver. Now... Go to Chicago (or some other nice midwest city) and put that same price cap. Are you going to still tell me Denver hasn't crossed a crazy threshold?

I tend to agree but when I compare Denver to other peer-ish mountain west cities Denver’s prices actually don’t seem outlandishly out of touch. I can also work from anywhere but want to stay in an urban area close to the mountains. But when I start looking I can’t find much that provides significantly better value than Denver. When I look at Bozeman, Salt Lake City, Boise, or Bend I don’t see much more house for your money. Hell even Reno seems to be in the same neighborhood for real estate prices.

[SirLucasTheGreat]

Seems like things might be heating up around the 38th and Blake Station

Apartment developer pays $24M for site of planned 483-unit RiNo complex

https://businessden.com/2021/02/04/multi...r%23newsletter%23newsletter%23newsletter

[twister244]

Originally Posted by TakeFive

Source

I apologize since you have family in Chicago and downtown Chicago is very nice as are many parts of Chicago, I'm sure.

But I'm also aware that most municipal bonds and state bonds are rated one notch above junk. Both the city and the state are experiencing net out-migration. Doesn't necessarily mean one shouldn't live there though.

If I were to move to the upper mid-west, especially if I had a family I'd choose Columbus OH. Their bonds are rated Triple A (like Denver) and Ohio bonds are rated Aa1 - same as Colorado's.

Honestly, I understand Denver housing prices are rather high but compared to other desirable cities "west of the Mississippi"? I'd assume SLC and Boise are still lower and ofc all the desert cities and Texas.

I don't see any benefit in re-litigating Denver Zoning. I'm more flexible than NIMBY's but less flexible that YIMBY's. But it is what is and I still believe that zoning for fourplexes would accomplish little to nothing.

My point in posting about Chicago wasn't to advocate that Chicago is in better shape as a city compared to Denver....

And yes, Chicago is an outlier and there are other cities that are more comparable to Denver. But... I feel like Denver stands out right now amongst peer cities (maybe Austin being the exception) in how badly our supply/demand imbalance is. If you look at that article I posted, we keep breaking records of low housing inventory. This means we are heading into selling season with record low inventory, continued low mortgage rates of <3%, and an economy that's going to start opening back up. Anyone hoping to get a SFH or townhome for under $500k is about to see their hopes completely evaporate, if they haven't already.

And yes, you can go out to the burbs and find lower prices, but things are also going up there as well.

[The Dirt]

No point in debating TakeFive while he has his Boomer rose colored glasses on. Everything is fine because I got mine. #boomer4lyfe

[EngiNerd]

Originally Posted by twister244

I think it's already too late. This article that came out today is just depressing to read.....

https://www.westword.com/news/denver-average-home-prices-up-100000-in-a-year-11892826

$100k in one year. Let that sink in for a moment.

Denver should do what Minneapolis did a couple years ago, but we all know that won't happen.

That's pretty much the whole story in one image....supply has dropped off a cliff, but demand I would bet is still similar to what it has been in the last several year.

[EngiNerd]

Originally Posted by twister244

My point in posting about Chicago wasn't to advocate that Chicago is in better shape as a city compared to Denver....

And yes, Chicago is an outlier and there are other cities that are more comparable to Denver. But... I feel like Denver stands out right now amongst peer cities (maybe Austin being the exception) in how badly our supply/demand imbalance is. If you look at that article I posted, we keep breaking records of low housing inventory. This means we are heading into selling season with record low inventory, continued low mortgage rates of <3%, and an economy that's going to start opening back up. Anyone hoping to get a SFH or townhome for under $500k is about to see their hopes completely evaporate, if they haven't already.

And yes, you can go out to the burbs and find lower prices, but things are also going up there as well.

You also have to consider property taxes in Illinois when looking at total cost of homeownership in Chicago, it is much higher than in CO....their property tax rate is roughly 4x that of Denver. So while it may appear more affordable on the face value of housing prices alone, the monthly mortgage costs will likely be very similar.

Edit: here's a good map showing relative property taxes...master planned community development tax districts can skew this obviously, but they likely could in most states as well.

https://learn.roofstock.com/blog/cities-with-highest-property-taxes

[twister244]

Yep, totally get the tax situation. A couple years ago, yeah, with taxes the COI of owning was comparable, but with Denver rising as fast as it has, the tables are beginning to turn compared to several cities.

[TakeFive]

Originally Posted by EngiNerd

Edit: here's a good map showing relative property taxes...master planned community development tax districts can skew this obviously, but they likely could in most states as well.

Any thoughts on how the repeal of the Gallagher amendment will impact property taxes going forward?

Originally Posted by The Dirt

No point in debating TakeFive while he has his Boomer rose colored glasses on. Everything is fine because I got mine. #boomer4lyfe

Let me paint a picture; perhaps it will help.

Ball Corp is a long time metro area company with its headquarters in Broomfield. In recent years Ball Corp has significantly restructured their operations:

Can giant Ball Corp. to build a new plant in Goodyear (AZ)

Ball Corp. said it will build a new beverage packaging plant in Goodyear while shuttering three beverage packaging plants elsewhere in the U.S. Goodyear is steadily becoming an industrial powerhouse in the Valley...

https://azbigmedia.com/business/economic...n-build-stateoftheart-facility-goodyear/

“We’re excited to begin construction on our new beverage packaging manufacturing facility in Goodyear,” said Carlos Medeiros, president, Ball Beverage Packaging North & Central America. “The Phoenix area’s skilled technical workforce and business-friendly environment are ideal for this expansion of our U.S. operations, which will allow us to better serve growing customer demand for specialty beverage cans in the southwest.”

The Demand side of the Demand/Supply curve
When you have more people trying to buy a limited supply of widgets, it tends to push prices higher. Just as important is how much money those people have in their pockets.

Ball Corp provides good-paying jobs but there's a big difference between what their factory workers make and what the guys/gals make at their headquarters.

Goodyear is a newer, growing area in West Phoenix. Just checked and you can buy a home starting at ~$300,000 (including new construction). Goodyear also has some nice areas where homes cost up to $1 million. Next door to Goodyear is Tolleson an older area with a more diverse housing stock that starts at ~$225,000.

Denver/metro has done an impressive job of recruiting (tech) companies who pay a handsome amount to their employees. Is this a good or bad thing? Is it because I'm a boomer?

Why would Ball Corp locate their manufacturing facility in west Phoenix? Here's what Chris Camacho has to say.

“Greater Phoenix is a hub for manufacturing facilities; more than 2,700 Arizona-based companies make this state one of the nation’s largest supply chain contributors for advanced manufacturing,” said Greater Phoenix Economic Council President & CEO, Chris Camacho.

The Goodyear site selected for the new facility made for an attractive selection due to the infrastructure in place, such as fully developed power, water and gas lines, and its proximity to the Loop 303 and Interstate 10 providing quicker distribution to filler facilities...

People who make less have fewer $'s in their pocket to spend on housing yet markets will adjust. Having 'cheap' land, access to utility infrastructure is obviously important. Phoenix/metro is business friendly to more pedestrian companies as much as hi-brow companies and is also developer friendly. Makes a HUGE difference.

Would you care to explain why/how my being a boomer has anything to do with the type of business and industry and earning level that Denver has/recruits as apposed to the same in Phoenix? You think my being a boomer is why it's less expensive to build in Phoenix and more costly in Denver, why people in Denver have more $'s in their pocket than those in Phoenix?

[TakeFive]

Originally Posted by twister244

Yep, totally get the tax situation. A couple years ago, yeah, with taxes the COI of owning was comparable, but with Denver rising as fast as it has, the tables are beginning to turn compared to several cities.

Good point.

Btw, it wasn't my intent to insult your preferences; just making observations. We all come from some place where we spent our formative years. These places will always hold special memories. I grew up in a small manure town an hour's drive southwest of the Dubuque IA. I can recall being impressed by my cousin's place which was in Sioux City IA; used to ski on the Missouri River. Of course for me that was 50 years ago.

https://www.marketwatch.com/story/this-i...-in-california-11612452891?mod=home-page

Home prices skyrocketed over the past year, but the economy has yet to catch up

And four states were rated as having undervalued housing markets: Connecticut, Illinois, Michigan and New Jersey.

Compiled by Fitch Ratings, they obviously looked at earnings (per capita) in evaluating housing costs. Denver wasn't listed but Las Vegas (which appreciated the most last year) and Dallas–Fort Worth were at the top for being overvalued.

Other states whose housing markets were found to be overvalued in excess of 10% included Arizona, Texas, Kansas, North Dakota and Washington, among others.

Denver one of worst cities for construction job loss, association says
Posted: Feb 2, 2021 by: Dan Daru - KDVR

DENVER (KDVR) — The sights and sounds of construction echo in the concrete canyons in lower downtown Denver. To the casual observer, one would think this is good. But according to the Washington, DC-based Association of General Contractors of America, you would be dead wrong.

A new report by the AGC, a 100-year-old trade association, tells the Problem Solvers that Denver is one of the worst cities in the nation for construction job losses. In the Denver metro area, 6,900 jobs were lost. That put Denver in the top five worst cities for lost work.

“Sadly, Denver, Aurora, Lakewood — the metro area — had one of the biggest losses of construction employment of any metro area in the country,” said Simonson.

This suggests that Denver was seen (last year) as being near equilibrium by developers. There was, at least in the central city, a lot of projects under construction; many that were in the 'finishing' phase and fewer projects coming out of the ground.

[wong21fr]

Originally Posted by TakeFive

Why would Ball Corp locate their manufacturing facility in west Phoenix? H

Because you're next to CA, but you're not in CA. AZ is CA's Mexico: cheap labor, lower cost of living, a lighter regulatory load, and well within easy transportation distance.