A bill that will set up a small agency tasked with developing a statewide housing plan is now working its way through the New Mexico State Legislature as that body nears the end of its winter session. As proposed by Senator Michael Padilla, Senate Bill 71 would see the creation of an Office of Housing that would be a part of the Department of Finance and Administration, taking on a holistic approach to a myriad of housing issues across the state. According to an analysis of the bill put together by the Legislative Finance Committee, the Office of Housing would study “housing issues and work with governments and private developers to plan projects and acquire funding to address housing needs.” The office would also coordinate its efforts with “regional housing authorities, local governments, tribal governments, and private housing stakeholders,” as well as any number of state agencies, to make up an annual state housing plan. While lawmakers have lauded the intent of the bill, some have wondered if in its work, the proposed Office of Housing will end up duplicating the work of the existing New Mexico Mortgage Finance Authority. Despite those reservations, the measure has won the support of Governor Michelle Lujan Grisham, along with the Northern New Mexico Builders Association, Santa Fe Home Builders Association, and Greater Albuquerque Chamber of Commerce. According to an estimate produced by the Office of the State Auditor, the proposed Office of Housing would require around $375,000 annually to support a four-person staff. The measure is currently under review in the Senate Finance Committee. By Garry Boulard
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Across the Board, Metro Areas Record Significant Home Price Increases, Says Industry Survey2/12/2024 An overwhelming majority of the country’s metro areas saw an increase in sales prices as 2023 came to an end, reflecting an increasingly strong seller’s market. According to the National Association of Realtors, a big 189 out of 221 metro areas nationally saw home price increases, representing 85% of those markets. Even more, roughly 15% of those 221 markets saw double-digit home price increases. “Homeowners have benefited from housing wealth accumulation,” Lawrence Yun, chief economist with NAR, said in a statement breaking down the most recent trend lines. The average single family home price as of the end of December was up to just a little under $392,000. That figure represents a 3.5% increase over the same period of time in late 2022. The price increases were seen everywhere, with the Northeast showing the greatest growth at 7.3%, followed by the Midwest at 4.7%, and the West, with a 4.2% gain. While overall volume was up in the South, the year-over-year fourth quarter price increase came in at 3.2% Whether the higher prices will continue into the first quarter, and indeed for the rest of the year, may well be determined by availability, said Yun, who noted that "increased homebuilding, along with lower mortgage rates, will not only improve housing affordability, but also help bring more homes onto the market in 2024." Monthly mortgage rates are also expected to play a role in the affordability question. The average payment on a starter home valued at $332,900 actually dropped from $2,146 in the late summer and early fall of last year to $2,120 between October and December. By Garry Boulard A more than 70-year-old structure that is a part of the historic Loretto Heights College campus in Denver may soon see a substantial upgrading. Located at 3040 South Loretto Way, the two-story Machebeuf Hall was opened in 1951 and, because it is an example of mid-20th century Modernist design, is valued by preservationists and architectural historians. According to city records, the 39,000-square-foot structure is distinguished for its textured cast stone blocks and large window and door glass panels. The interior of the building features a split-level lobby with terrazzo floors and metal rail staircase. The Denver nonprofit group Commun, which focuses on providing a variety of food access, mental health, and job training programs, has announced its intention to renovate Machebeuf Hall's interior as part of a larger plan to turn the building into a community center. The renovation will see the creation of retail space in the building, as well as offices, childcare facilities, and a food hall, among other features. Commun purchased the building late last year with the help of a $3 million grant secured via the Denver's Office of Economic Development & Opportunity. By Garry Boulard A bill to designed increase the chances that approved capital outlay funding actually results in a completed project is under review in the New Mexico State Legislature. For years members of that body, as well as public policy advocates, have derided a system that sees funded projects go unfinished, saying that in such situations the funding is thus wasted. Now new legislation has been proposed by three lawmakers designed to tighten up the process. House Bill 232, sponsored by Representatives Gail Armstrong, Meredith Dixon, and Dayan Hochman-Vigil, would task the New Mexico Department of Finance and Administration with setting up a planning division that will assist local and tribal governments with their capital outlay challenges. According to an analysis of the bill conducted by the Legislative Finance Committee, various obstacles often appear to prevent the completion of any given capital outlay project. Those projects, says the analysis, include "piecemeal funding, lack of financial, technical, and administrative capacity at the state and local level, and insufficient planning prior to funding." The focus of the proposed planning division would be on "building and implementing a new capital project management and tracking system and establishing its funding navigation and coordination duties." The bill has now been approved by the House Appropriations & Finance Committee, with one week to go before the New Mexico State Legislature is scheduled to conclude its 2024 session. By Garry Boulard Home insurance rates are continuing to increase, and in some cases greatly so, according to an industry survey indicating that some of the most substantial hikes have been seen in the West. Looking at the overall rate trendlines from 2021 to last year, the Topeka, Kansas-based insurance broker Policygenius puts four Western states in the top five for cost increases, with New Mexico leading the way with a 47% jump. In real dollar terms, that means that the state's annual costs have risen from an average of around $855 to just under $1,300. The other three states in the top five: Colorado, where rates jumping from just under $1,400 to just over $2,000 are making up a 46% increase; and Idaho, also with a 46% increase, and costs rising from $552 to just over $800. The final Western state at the top of the list: Texas, with costs rising from $1,471 to $2,141, also comprising a 46% increase. Leading the list, and not for the first time, is Florida with a massive 68% increase and dollar cost going from $1,127 to just under $1,900. According to the publication Money, explanation for the rise in Florida is simple: the Sunshine State experiences an average of three hurricanes a year. But the rising insurance costs in the West are due mostly to the advent of wildfires. "Wildfire risk isn't just making it more expensive to get insurance in affected states," notes the publication. "It's also making it harder for some people to find coverage at all as insurers are reportedly reducing exposure in certain areas." Other states in the West were similarly hard hit, but not as much as the top five. Arizona has seen a jump of 26%; Nevada, 16%; and Utah, 29%. Overall, according to the Policygenius Home Insurance Pricing Report, insurance costs have gone up nationally by 21%, with states in the Northeast experiencing the smallest jumps. Vermont, for example, saw a 7% increase. A report released late last year by the Congressional Research Service also noted another facet of the homeowners’ insurance challenge: areas where insurers may be pulling out altogether, "leaving people unable to find insurance at all except for state-created insurers of last resort." Such entities, the report continued, "may offer coverage that is more expensive or less complete than private coverage." By Garry Boulard Plans are now underway for the building of twenty tiny homes that will be geared for teachers on property owned by a growing school district in Colorado Springs. The unusual project is part of a move by the Harrison School District 2 to secure teacher housing in a city where the average monthly rent for a one-bedroom apartment is now nearing the $1,800 mark. The 352-square-foot structures will go up on the site of the Mountain Vista Community School, at 2550 Dorset Drive on the southeast side of the city. District officials estimate that it will cost around $6 million to build the structures. A timeline for the construction of the units has not yet been announced. The Harrison School District initiative follows a pattern laid down by other Colorado school districts tackling the housing affordability challenge: both the Aspen School District and the Summit School District near the central part of the state have built student housing in recent years. Harrison School District officials have also been supportive of a new project seeing the building of what in Colorado Springs is called the Bentley Commons, a complex of 192 affordable housing units. The Bentley Commons effort will see the building of six structures on a site already occupied by two existing apartment buildings, with rents for residents making 60% or less of Area Median Income. By Garry Boulard The City of El Paso has put in place an ambitious program designed to increase affordable housing projects in neighborhoods across the city. What is officially called the 2024 Low Income Housing Tax Credit is designed to help address the funding challenges that come with building any housing project. According to a City posting, “scarce funding hampers El Paso’s affordable housing projects, impeding efforts to meet growing demand across income levels.” The initiative is seen as all the more timely given that the City currently has a gap of some 15,000 low-income housing units, a gap that some experts have said is only expected to grow during the next decade. In the City posting, the challenges for such projects are clearly spelled out, with an emphasis on the problems with land use restrictions: “Strict land use regulations limit areas for affordable housing, complicating new developments and perpetuating socio-economic disparities.” Projects targeting housing for resident earning 30% of Area Median Income are additionally confronted with a funding gap, “requiring extra subsidies and posting financial challenges without substantial support.” By design, the Low Income Housing Tax Credits have the potential of subsidizing up to 70% of the low income unit costs in any given project. Four developers have thus far applied for the tax credits to be applied to projects in varied sections of the city, with two planned for the west side and two more on the far east side. In response, members of the El Paso City Council have approved Letters of No Obligation, allowing those projects to advance without any one project having an advantage over another. By Garry Boulard How small businesses are officially defined by the Small Business Administration can have a dramatic impact on their rate of success, according to testimony heard before the House Committee on Small Business. In commenting on that testimony, Missouri Republican Representative Mark Alford noted that “since 2010, the number of small businesses winning federal contracts has dropped by 50%.” Calling that a “stark decline,” Alford went on to remark that the federal government’s “sizing standards,” which he said are out of date, are a major factor in that decrease. Committee members have been particularly critical of SBA’s operating definitions owing to the negative impact they have on small businesses being competitive in the federal procurement marketplace. In remarks during the hearing, Jay Lambke, president of a business called Government Acquisitions, Incorporated, which is based in Cincinnati, said that while his company has had decades-long success in providing information technology services for the federal government, it has been hampered by the SBA categorizations. Not only are the definitions of what constitutes a small business becoming increasingly restrictive, said Lampke, but the wait times involved in getting an answer on a contract bid are longer. Lambke added that such challenges “create the need for more government contracting professionals on staff, which include lawyers, technical writers, and subject matter experts.” “Not only does this add significant expense for business,” said Lambke, “but it also adds to the number of employees.” Texas Republican Representative Roger Williams, who is the chairman of the House Committee on Small Business, noted that size standards were generally established in the 1950s and designed to “protect small businesses by ensuring that only small firms received SBA assistance, in addition to determining eligibility for federal contracts.” But in recent years, continued Williams, small businesses have begun to see their chances for securing federal contracts decline. “Many agencies use a receipt-based standard, and if it is too low, it may prevent the business from fully participating because they can lose their size status due to a high revenue-generating contract.” “This,” added Williams, “is nothing more than punishment for a business succeeding, which is antithetical to the American dream.” In a public posting, the SBA has noted that the agency’s size standards are “reviewed every five years.” The agency added: “SBA takes comments from the public into consideration before finalizing proposed rules on size standards." The agency adds that SBA welcomes suggestions on "alternative methodologies, factors, datasets, effects on competition, and approaches that make sense in the current economic environment.” By Garry Boulard A project in central Colorado that has been under consideration for the last 5 years will soon be the subject of new public input. Officials in El Paso County have long wanted to construct what would be a third nature center, building upon the success of two existing nature centers in the Bear Creek and Fountain Creek regional parks. Those two centers have proven wildly popular with locals and visitors, receiving nearly 30,000 people a year. The third nature center has been slated for the 400-acre Fox Run Regional Park, which is located at 2110 Stella Drive in Colorado Springs. The project is expected to cost up to $10 million to complete and will see the building of a combined visitors and education center, with interactive exhibits exploring the natural wonders and resources of a wooded swath of the county. The Colorado Springs-based TDG Architecture has signed on as project designer for the center, which will include a classroom area, plaza, and observation tower. The two scheduled public input meetings for the project will be held on February 16 and March 14. County officials have said that they hope to see work on the center begin in 2025. By Garry Boulard After a search of many months, the Arizona Coyotes have announced plans to buy some 200 acres of land in northeast Phoenix for the construction of a new hockey arena. The move comes more than half a year after voters in Tempe defeated a proposal to build a new home for the Coyotes. That $2.1 billion project would have seen the construction of both an arena as well as a larger 46-acre entertainment district. Opposition to that project among Tempe voters centered on the granting of city tax incentives to get the project built. In the wake of that defeat, the Coyote's ownership declared that it was determined to remain in the Grand Canyon state and would seek another site for the project. That site may well now be in Arizona's largest city, with a bid by the team to purchase property owned by the Arizona State Land Department. In making that bid, the Coyotes will end up competing against any other parties interested in buying the property in an auction that will be conducted by the State Land Department. The State Land Department Board of Appeals is scheduled to meet on February 8 and may take up the matter of the Coyotes' interest in the property. The matter of the Coyotes finding a new home has been an ongoing saga, especially for hockey fans. The team, which has played in Mullett Arena in Tempe for the last two years, entered into discussions in the summer of 2021 with officials in Tempe to build in that city. By Garry Boulard |
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