Aspen’s Half-A-Billion Dollar Housing Scam

March 21st, 2008 at 05:59am Michael Conniff 2

For the most part, people in Aspen have no idea when pols behind closed doors are making calls they will pay for through the nose for a long, long time.

This is one of those times, as city officials huddle for the first time to float a plan that would float a bond to pay for affordable housing.

The cost: $200 million with an ultimate cost that will easily approach and even surpass $500 million.

Even in Aspen, that’s half a billion dollars. I first broke the story in Aspen Post but even then it seemed far-fetched. Now it seems even worse than I thought: a story of anti-democratic politicians who have never actually run a real business but don’t hesitate to spend hundreds of millions of taxpayer dollars they don’t even have.

Sit still for a moment while I give you the skinny, and keep in mind that everything is driven by the political constituency of those who live in affordable housing, some 60 percent of voters in Aspen, according to what I’ve heard. That constituency is at the heart of the power wielded by Mayor Mick Ireland and his voting majority of City Councilors Jack Johnson and J.D. DeVilbiss. When The Mick and the councilors pump money into affordable housing, they are kowtowing to the very constituency that put them into office.

That’s the context. Now keep in mind the fact that Mick Ireland, when he was running for office, had no idea how much money was in the affordable housing fund when I asked him on my radio show “Con Games.” Turned out the number was $12 million, but now I realize why The Mick didn’t know or even care: because it didn’t matter. No matter how much money was flowing to the RETT fund Mick and his co-conspirators were going to spend much, much more once in office.

And that’s exactly what’s happened. Paying far in excess of market rates, the City Council has squandered close to $40 million in a year when the Real Estate Transfer Tax (RETT) money that funds Aspen affordable housing is dipping because of the economy. As I’ve blogged before, the Aspen affordable housing fund is broke. The City doesn’t even have the money to finish the second phase of the Burlingame housing project.

Here’s the kicker. Heretofore, the RETT affordable housing fund has been a pay-as-you-go mechanism, with money into the coffers flowing out to pay for projects as they occur. The $200 million bond, if approved by voters, turns that upside down, committing the City to using RETT money to pay interest and principal for housing that the city could not otherwise afford.

In other words, the money for affordable housing would be used to pay off the whopping debt incurred by The Mick and his minions.

The irony here among many ironies is that The Mick and his pals were easily elected to office on a platform that was anti-development. With the $200 million—and a looming commitment to new City space at the Zupancis-Galena (Z-G) property—the City of Aspen will far and away become the biggest developer in a town freshly engorged by cranes and construction trucks.

My belief is that if The Mick manages to get the $200 million bond on the ballot it will pass easily because voters will perceive it as money that goes to the good cause of affordable housing. What they are not likely to understand is that the City of Aspen will be paying off the bond for a long time.

Half a billion dollars. Think about it and ask yourself why the pols who control Aspen’s future have any shame left.

Entry Filed under: Aspen, Colorado, Con Games, The West, Affordable Housing, United Post, Aspen City Council