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Durango hotel project for transitional housing included in federal bills, but it’s less than hoped

City likely to receive $3 million for purchase of Best Western
The city of Durango is considering buying the Best Western Inn & Suites on U.S. Highway 160 in west Durango to convert and use as affordable or transitional housing. (Shane Benjamin/Durango Herald file)

Funding to purchase a hotel that could be used for transitional housing in Durango has been included in final appropriations bills for 2022. The funding bills include a total of $158 million for projects across Colorado, the state’s two U.S. senators announced this week.

Sens. John Hickenlooper and Michael Bennet secured funding for 50 projects across the state. Nonprofit organizations and local governments submitted requests earlier this year for the funding, more commonly known as earmarks, or provisions in annual appropriations bills that direct money to a specific recipient while avoiding a competitive allocation process.

“These projects will make a real difference in towns all across our state,” Hickenlooper said in a news release. “Coloradans know best what their communities need, and Congress should do its best to listen.”

The Durango Hotel Conversion Affordable Housing Project received $3 million, the third-highest amount of all 50 projects. The city government requested $9.6 million originally, with the goal of purchasing and converting a 71-unit Best Western Inn & Suites, at 21382 U.S. Highway 160, into affordable housing. The hotel could be used for a variety of purposes to support housing needs and will be supported by other funding sources, such as private investments from developers.

The city of Durango is considering buying the Best Western Inn & Suites on U.S. Highway 160 in west Durango to convert and use as affordable or transitional housing. (Shane Benjamin/Durango Herald file)

The city must now find a way to quickly raise an additional $6.4 million for the hotel purchase and redevelopment. The earnest payment, or money paid to confirm a contract, of $70,000 is refundable for up to 90 days. If the project does not seem feasible, the city will receive the $70,000 back. If the city finds the funding for the project, the earnest payment will go toward the price of the project.

But Mayor Kim Baxter, who led the request for the funding, said the 90-day period can possibly be extended and renegotiated.

Baxter acknowledged the $3 million is less than the city expected. But she said it may still be possible to pull together the money. She said the city is holding a meeting Nov. 19 to discuss where the project stands and what type of housing is being proposed at the Best Western.

City Councilor Olivier Bosmans, who opposed even exploring the possibility of purchasing the hotel, said he is “very concerned” that more taxpayer money might be used for the hotel conversion instead of putting it toward a better project.

“I’m waiting for a response from the city manager on this breakdown of the initial grant request,” Bosmans said about the likelihood that the $3 million funding won’t be enough. “That answer is still pending because apparently that $9.6 million didn’t only cover the hotel conversion, it had other elements in it, which I was not aware of nor was I informed of.”

Baxter remains optimistic. She said the $3 million will go a long way toward helping the community and filling the gaps in housing.

“It could be a permanent supportive housing, which would mean that people can stay there as long as they needed before they moved on,” Baxter said. “It could be middle-income housing or it could be remodeled to be where you could combine some of the units or maybe add some more so you could do some workforce housing.”

The funding comes amid a housing shortage in Southwest Colorado. According to a recent assessment by Housing Solutions for the Southwest and Southwest Colorado Council of Governments, between 2010 and 2019, no county in the region was able to keep up with demand for housing to accommodate employment growth and demand for seasonal and vacation housing.

The assessment surveyed 105 regional stakeholders working in fields such as housing, community development and local government about their perceptions of housing needs in the respective areas they work in. One hundred percent of respondents serving Durango identified Durango as having the most severe housing needs.

Housing prices have increased significantly over the past few years in La Plata County, a leading cause of housing insecurity. The number of homes sold for $750,000 increased by 169% between 2018 and 2021, while the number of homes sold for less than $250,000 decreased by 37%.

Rentals for affordable housing, funded by public and private investments, have long been thought of as a solution to the problem. Since 2010, almost 300 rentals funded by public investors, a majority of which are in La Plata County, have been developed or are close to being developed, according to the assessment.

However, La Plata County’s share of affordable housing provided by private investors has significantly decreased. Forty percent of nonseasonal rentals charged $1,500 and more in 2019, compared with just 13% in 2010. Six hundred rental units also converted from nonseasonal rentals to vacation rentals.

Donna Mae Baukat, executive director of Community Compassion Outreach, has advocated to put people who need housing in motels, especially during the winter when temperatures are freezing and many are sleeping outside.

“We had a couple grants last year that helped people into motels and especially if they were vulnerable to COVID,” Baukat said.

But because of the increase of motel rates, Baukat hasn’t seen it as a long-term solution anymore.

“Putting people in a motel is only a Band-Aid fix, so we’re not excited about doing that over and over again,” she said. “It just makes it almost impossible for us to afford to put somebody in, especially if you’re looking at two weeks for maybe $500 to $800 just for those 14 nights.”

Baxter said it is also a possibility that the hotel could be used as a “managed camp” for homeless people because of the areas of open space available behind the building, or it could be used as transitional housing for people coming out of homelessness.

Other projects that were funded include an integrated center for food security at Fort Lewis College, the purchase of two zero-emissions buses and charging technologies, and a study to evaluate substance-use disorder resources in Southwest Colorado.

The bills have yet to pass the House and the Senate to become law; however, they are likely to pass, according to Hickenlooper and Bennet, who said they will continue to push for them to be included in the final negotiated bill.

“As we recover from the worst public health and economic crisis in a century, this funding will help meet the needs of Colorado communities across the state,” Bennet wrote. “From expanding access to health care to building affordable housing and creating good-paying jobs, these investments will help rebuild our economy to deliver opportunity to every Coloradan.”

Kelsey Carolan is an intern for The Durango Herald and The Journal in Cortez and a senior graduating in December 2021 at American University in Washington, D.C.

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