31 Dec DECEMBER REPORT – From the TAR Government Affairs Department
December Article, 2018 | December 31, 2018
This monthly government affairs/public policy report is prepared for informational purposes for the members of the Telluride Association of REALTORS® (TAR). It is a snap shot of issues important to the real estate industry at the local, state, and national levels. Any position taken on local issues is done at the direction of the TAR Board of Directors and is done with considerable debate and discussion by TAR leadership. Positions taken by CAR or NAR on issues at the state and national level will be reflected in the article when applicable.
Nick Bokone, Cornerstone Political Solutions LLC
Council Discusses Land Use/Housing at Recent Retreat
Telluride Town Council held their annual retreat on Friday, December 7th to go over plans and major discussions for 2019 and beyond. As you might expect, plenty of land use and housing issues are on the minds of our elected officials and should take up a large majority of Council’s time in the coming new year.
As is the case in a legislative retreat such as this one, no specific ordinances or amendments were on the table. Instead, members of council had the opportunity to talk in generalities about their wishes for items to come before the body next year. Among those topics:
- Residential down zoning through the Planned Urban Development Process to plan for affordable housing – this discussion will likely include density/zoning change discussions to allow for more affordable housing units.
- Master Plan Review – again, this will be a chance for Council to realign land use priorities through the Master Plan
- Historic and Architectural Review Commission (HARC) – how demolition and redevelopment is affected by HARC requirements for affordable housing projects
The Telluride Association of REALTORS® will continue to monitor and engage on these topics when appropriate. Land use, housing, and affordable housing solutions remain important to our members, their clients, and the economy of the entire area as a whole.
Art District Recertified, Economic Impact from the Arts is Large
As reported recently in the Daily Planet, following this summer’s visit to town by panelists from Colorado Creative Industries (CCI), the Telluride Arts District, established in 2012, was recertified for another five years. The arts district’s certification status is re-evaluated every five years based on the success of the district to reach goals set in the Telluride Cultural Master Plan and by CCI.
Five years ago when the district was created, spending by arts audiences was $150.22 per person per day, compared to the national average of $24.60 for smaller communities. That includes food, lodging, clothing, gifts, transportation and other expenses. Nonresident attendees spent an average of $382.29 per person per day. All told, the study revealed that the nonprofit arts and culture area in the Town of Telluride is a $37.4 million industry — one that supports 977 full-time equivalent jobs and generates $2.6 million in local and state government revenue.
Federal News: Proposed Increase to Residential Appraisal Threshold
On Nov, 20, 2018, the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, and the Federal Deposit Insurance Corporation (collectively “the Agencies”) released a proposed rule that would increase the current threshold for residential real estate transactions requiring an appraisal to $400,000. The current threshold is $250,000.
In lieu of an appraisal, an evaluation would be required that is consistent with safe and sound banking practices. This rule would only affect Federally Related Transactions overseen by the Agencies. Residential real estate transactions covered by the Fair Housing Administration, the U.S. Department of Veterans Affairs, the U.S. Department of Agriculture, Fannie Mae, and Freddie Mac would still be subject to those entities’ appraisal requirements.
NAR Meets with Chairman Hensarling on Housing Finance Reform
Recently, NAR legislative staff met with House Financial Services Committee Chairman Jeb Hensarling (R-TX) to discuss his recent housing finance reform discussion draft called the “Bipartisan Housing Finance Reform Act of 2018,” which is cosponsored by Rep. John Delaney (D-MD).
The proposal directs Ginnie Mae to guarantee mortgage-backed securities (MBS) that are backed by loans with various credit enhancements. In addition to borrowers having more skin in the game, additional credit enhancements must come from Federal Housing Finance Agency (FHFA)-approved private credit enhancers (PCEs). Once appropriate credit enhancements have been made, Ginnie Mae-approved issuers will then be allowed to issue government-backed securities through its platform.
NAR supports many components of the legislation such as an explicit government guarantee, flexibility given to regulators to set standards in the new mortgage finance system, and the use of a Common Securitization Platform (CSP) as the issuance platform for mortgage-backed securities. These provisions will help build a new housing finance system structure that will be more transparent, while providing a countercyclical mechanism to help ensure mortgage credit is available during periods of economic distress.
While these components are a good foundation for a future housing finance market, NAR provided suggestions to the Chairman that would improve the proposal. Among other things, NAR suggested to include language that would require Ginnie Mae to have a dual mandate to safeguard the secondary mortgage market, but also to ensure for a deep, liquid, affordable, and national mortgage market. Finally, NAR committed to continue to work with the Chairman to create a mortgage market that provides access to affordable mortgage credit for all creditworthy Americans, while ensuring taxpayers are properly protected.