Colorado's Growth Challenges Gain Altitude As Mountain Towns Look Toward Busier, More Expensive Future

Colorado’s mountain towns, home to a winter sports industry that for 10 years helped the state attract hundreds of thousands of new residents, are now confronting challenges born of their own success — populations have swelled beyond comfort putting immense pressure on infrastructure, city budgets and housing.

These challenges are most apparent in the declining affordability of housing in these towns for the workers who staff not just resorts and restaurants, but places like grocery stores and even pharmacies.

“Everybody knows that it comes down to housing,” said Tamara Pogue, a Summit County commissioner. “That is the underlying problem. We have got to find a way to house the people who live in Summit County, first and foremost, before we have the capacity to be a vacation spot.”

Next up on the list of concerns is congestion.

“We are seeing the effects of our success really starting to affect locals and visitors alike with regard to the amount of traffic and gridlock and those sorts of things,” said Jim Curnutte, Summit County planning director.

In Summit County, which contains Breckenridge, Keystone and Copper Mountain, among other popular mountain towns, the permanent population of roughly 30,000 can more than double on any given night with tourists bringing the nightly count to as many as 75,000, Pogue said.

And those tourists aren’t staying in hotels. In spite of serving as a top destination in a state where tourism is among the main economic drivers, mountain towns don’t have a large supply of traditional hotel rooms relative to the number of overnight guests.

Visitors stayed in rented condos near the slopes for years before short-term rentals popularized the idea of crashing in someone else’s house. But with the advent of platforms like Airbnb and VRBO, which make it easier than ever to rent out a home part time, more property owners than ever have embraced the short-term rental strategy.

And, while affordability for the permanent residents of these towns has been a concern for years, it was exacerbated, like so many other things, by the pandemic. 

As remote work spread, Pogue said, more people who owned secondary properties in mountain towns began using these homes as primary or permanent residences, cutting down on the supply of spaces available for visitors.

The Mountain Migration Report, a study compiled by the Northwest Colorado Council of Governments in 2021, shows that part-time residents intend to extend their time in their mountain properties by 30% compared to 2019. At the same time, wealthy newcomers are buying properties in the area for the first time, further cutting into supply.

“Much of Summit’s workforce has lived in our surrounding counties — Grand, Lake, Clear Creek — but homeowners have moved into those counties, which drives up the prices,” Pogue said.

But as the problem spreads, solutions remain elusive.

Like much of metro Denver, resort towns have grappled for years to find ways to increase their stock of affordable housing. Resorts themselves, understanding that their workers need somewhere to live, have tried to chip in by constructing housing, but these projects are typically a drop in the bucket compared to demand. 

Usually these projects are met with encouragement and support by local governments, but in one recent case, a proposed project by Vail Resorts bumped up against conservation concerns, highlighting another of the unique challenges faced by the towns: Their proximity to nature.

Vail Resorts proposed an affordable housing development on a parcel of land it owns within the town of Vail, planning to house 165 of its employees on five acres. But Vail’s town council voted against the development, citing a desire to preserve the habitat of a herd of bighorn sheep that often graze in the area. Then, the town went a step further and voted to condemn the land.

Vail Resorts alleges that the town’s actual priority is preventing affordable housing from going up near a luxury development just down the road. At the same time, some Vail residents showed up to the town meetings to deliver defenses on behalf of the wildlife, which has already been repeatedly pushed back as the towns and resorts have grown over the decades.

To the northeast, the town of Winter Park is the target of a few different development efforts. Alterra Mountain Co., which owns Winter Park resort, is set to break ground this summer on an affordable housing development for 300 of its employees, scheduled for completion next year.

But the company has much bigger aspirations for the town of fewer than 1,000 permanent residents. Last year, Alterra announced plans to invest $207M in capital improvements at its Steamboat Ski Resort in northwest Colorado. It wants to grow Winter Park to the third-largest ski resort in Colorado.

A 2022 Master Development Plan released by the company would add 358 skiable acres to the resort, plus seven new lifts to service the territory. In addition, Alterra would add a gondola from the town of Winter Park to the mountain that could carry as many as 3,600 passengers per hour. This plan, though, is for the resort only and does not outline potential plans for housing in the town itself.

For many people outside the state, ski resorts are synonymous with Colorado.

What began as a way for miners to make their way through frigid mountain terrain and transitioned into an industry supported mostly by local families and a faithful group of ski bums are now mentioned by just about every company executive, site selector and economic development professional when they’re asked about what makes Colorado attractive.

Perhaps the best example in recent years is the relocation of VF Corp., owner of outdoor brands like The North Face, to Denver after 20 years in North Carolina. In interviews following the 2018 announcement that it would become the Mile High City’s newest publicly traded company, VF Corp. CEO Steve Rendle cited the state’s “outdoor lifestyle” as a key factor in its decision. 

The sentiment has been echoed by dozens of executives and thousands of new Coloradans as the state’s population has exploded in the last decade.

Then there is the impact of tourism on the state’s economy. The industry suffered a big blow in 2020 due to the pandemic, but repeatedly set records in the years leading up to it. In 2019, Colorado travelers spent $24.2B, according to the Colorado Tourism Office. Ski trippers were the biggest spenders, parting with more than $1,200 per person on average.

The Front Range has unquestionably expanded at a rapid clip that municipalities have at times struggled to deal with. But in mountain towns, the strain is more easily felt, the result of small permanent populations, fewer services and geographic constraints.

“The community feels too busy,” Pogue said. When our gas stations run out of gas, or I can’t get a banana at the store, it’s a sign of a much bigger problem. We certainly appreciate the acknowledgment of the impact tourism has on the state’s economy. We know as a mountain community that we’re making significant contributions to the state. But how do we make sure we have the infrastructure we need to support that economic prosperity?”

Like so many other problems, the issues come down to funding. Summit County, for its part, applies for every grant it can find to pour federal and state money into its infrastructure needs, Pogue said. They’ve also tried to get creative, recently executing a master lease on an old hotel and transforming it into workforce housing.

Beyond more money, potential solutions lie in renewing ideas and discussions around zoning and planning, as well as density, she said. 

However, density is a tough one for mountain communities for obvious reasons. People living there do so largely because they like the small-town feel, the wide-open spaces and, of course, the views of Colorado’s snow-capped peaks. Attempts to increase density will have to be made with respect to those ideals, Pogue said.

The county also recently established a dedicated housing department, Curnutte said. 

“We used to attempt to do all of our housing efforts in the planning department, but it got to a critical mass where we created our own housing department,” Curnutte told Bisnow. “It started a couple of years ago with one person and now it’s up to four. Four people working full time trying to make inroads to improve our affordable housing situation.”

Voters in Summit County also approved a pair of new taxes that fund housing programs, and the county launched an incentive program for short-term rental owners, offering them up to $20K to convert to long-term leasing, depending on the length of the lease, Curnutte said.

Summit County this summer will embark on a new master-plan process, beginning with conversations with residents, and Pogue hopes that new, wiser land use decisions can be reached.

“Where I see us in the next five years is really having to find more balance on some of these issues,” she said. “We want tourists to be able to enjoy Summit County, but that’s not the trajectory we’re on unless we find a way to meet the infrastructure needs better than we currently have.”