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

The Craig Housing Action Plan is the result of a multi-stage process to collect input about housing needs and priorities in Craig and Moffat County.

The plan was developed with the help of outside consultants and a steering committee that consisted of local elected officials, business leaders, nonprofit service providers, developers and city staff.

Using information collected during a housing needs assessment in 2021, the steering committee held four additional workshops to develop the action plan, including an action plan strategy workshop, an employer housing workshop, a housing concept workshop and a land-use strategy meeting.

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

The primary problems identified in the plan are the limited supply of available housing and a lack of affordable housing for local wage earners. The plan states that constraints on housing are having a larger effect on the local economy as employers struggle to recruit and retain workers.

After it’s been adopted and implemented, the plan aims to support development for 90% of the identified housing needs in the community. As a result, the plan calls for 75 new residences in Craig with a mixture of 32 to 45 for-sale homes and 23 to 36 rental units.

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

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

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

On average, there have only been about five new building permits per year over the past several years, which means the local housing market isn’t keeping up with demand.

Because there is a gap between total building costs and the recommended rental and sale prices for essential workers, the plan suggests a community investment will be required to bring the housing market up to speed.

Williford explained that overall the plan focuses on increasing the number of units in Craig, so it’s not focused on developing traditional low-income housing. One of the big priorities is to develop a diversity of price ranges that are affordable to different income levels.

The action plan defines affordable housing as when the household is spending no more than 30% of its income on housing costs. For example, units could be considered affordable housing within the range of 60-80% Area Median Income (AMI), which is $39,720 to $52,960 for a three-person household.

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

The units are designed as starter homes and downsizing homes because that is what’s needed most within the target market the plan aims to serve. The theory is that many homes are under-occupied by senior or single community members who may be living alone in a larger home but aren’t able to sell because there are no smaller units available.

Council Member Tom Kleinschnitz brought up that several local hotels have been taken off the market to serve as short-term housing, but it is only a short-term solution. Having more one and two-bedroom units available on the market would allow for movement from short-term to long-term housing as well.

Council member Sean Hovorka raised a concern that the timing of the action plan completion falls in the same timeline of significant job industry changes with the coal and power plants closing, which may flood the market with 75 new units just as industry workers might be selling their homes to pursue work in other areas.

The changes to the local workforce was a major discussion point during the workshop sessions, but the consultants said they don’t foresee demand slowing down.

Williford also said the proposed units wouldn’t come onto the market all at once, as the development would happen over the next five years.

“We also said in the needs assessment, ‘Let’s take this slowly and continue to reassess,’” Williford said.

Council Member Kleinschnitz said even with industry changes, there will continue to be demands from multiple factors including new people moving to Craig from outside areas. There is also demand from Steamboat Springs, where the local workforce has started to look at Craig for affordable housing opportunities.

“If we don’t address this demand for housing from up valley, it will continue to compound 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.

That number could increase with the coming changes for the local coal industry. The steering committee is still exploring opportunities to potentially partner with the Yampa Valley Housing Authority to execute some of the housing goals detailed in the action plan.

Another opportunity, according to consultants, would be to look at expanding the Moffat County Housing Authority, which currently has a limited focus on senior housing.

Williford said housing authorities across Colorado are being tailored to meet community needs that aren’t being filled naturally by the local housing markets.

There is flexibility within the action plan for how the housing goals will be carried out. Council members will review the plan and strategies before the plan is presented for adoption in May.