Expanding Housing Affordability Ordinance and Affordable Housing Fee

The Expanding Housing Affordability ordinance will create more affordable housing options for our workforce as well as increase funding for Denver’s Affordable Housing Fund. There are three core elements: 

1. Requiring new residential development of 10 units or more to designate 8% to 12% of the units as affordable, regardless of whether the home is for rent or for sale. In higher-cost areas of the city, such as downtown, developers will need to provide 2% to 3% more affordable units. This will provide much-needed new workforce housing options in Denver. 
   • To align with state law, which requires alternatives to this requirement, the policy includes an option to pay a fee-in-lieu of the affordable units. This fee ranges from $250,000 to $478,000 depending on the unit type and market area.
   • The policy also allows for negotiated and community-driven housing agreements in certain situations.
2. Gradually increasing the “linkage fee,” which is a fee on new development used to build affordable housing for people with lower incomes. It is not assessed on development that provides affordable housing. The increase will provide much-needed funding for new homes and will bring Denver more in line with other cities nationally.
3. Offering zoning and financial incentives, such as flexible parking requirements, height incentives, and permit fee reductions, to help offset the cost of building affordable units and increase the overall supply of housing.

Updated July 2022

• The affordable housing fee is assessed alongside standard permit fees, all of which are due in full before building permits will be issued. 
• The Expanding Housing Affordability ordinance updated the linkage fee schedule, which will increase over the course of four years. The fee schedule can be viewed below. Annually, linkage fees are adjusted for inflation in an amount equal to the percentage change from the previous year in the national Consumer Price Index for All Urban Consumers (CPI-U).
• Exceptions to the linkage fee exist for certain developments. Please see the exceptions list.
• For mixed-use buildings containing 10 or more dwelling units, the non-residential portion of the building must pay the linkage fee unless it is a ground-floor commercial, sale or service use that is eligible for an exception per the incentives or is eligible for another exception.

Current Fee Schedule

Fee changes are published here and in the building permit fee policy(PDF, 162KB).

To encourage commercial employment grown in downtown and urban areas near transit while providing additional funding for affordable housing, the Denver Zoning Code provides incentives for commercial projects in certain circumstances.

Applicability: Projects with zone lots ½ mile of a rail transit station platform, using the general or shopfront building form and are located in an C-RX, C-MX or C-MS zone district or is within a D-C, D-TD, D-GT, or D-AS zone districts AND are a non-residential structure (meaning that the primary residential uses are less than 50% or less of the gross floor area, excluding parking) may pay 2 times the linkage fee for the entirety of the project and may develop to the maximum height with incentives set forth in the applicable building form table or section within Article 8(PDF, 25MB) for the downtown districts.

Example of a Commercial Development Accessing Incentives

A commercial project in the D-GT zone district has a base floor area ratio (FAR) of 8.0. If the applicants want to build from 8.1 to the maximum of 15.0 FAR, they must pay two times the applicable linkage fee at the time of building permit. If they applied for a building permit in December of 2023 and opted to build to 12 FAR, they would pay a fee of $10.84psf (fee of $5.42X 2) for the entire development (excluding parking).

The following exceptions to the linkage fee may be submitted, and they can be found in the Denver Revised Municipal Code Sec. 27-154. The required documentation at time of site development plan (SDP) is provided below. Exceptions must be approved prior to SDP approval.

1. Project with a pre-existing contractual agreement to provide affordable housing
   • Required documentation at time of SDP: A copy of the recorded affordable housing plan, contractual commitment, development agreement, or covenant, to be reviewed by CPD and HOST staff.
2. Projects with an existing affordable housing obligation as a part of zoning (e.g., FRCH 59 waivers)
   • Required documentation at time of SDP: The zoning ordinance number of the ordinance that contains the applicable zoning obligation, including any waivers and conditions or PUD, to be reviewed by CPD and HOST staff.
3. Affordable housing project funded through federal, state or local financial resources
   • Required documentation at time of SDP: Evidence that the proposed development has applied for and/or been awarded federal, state, or local financial resources and/or a summary of the legally enforceable instrument(s) that would serve to ensure long-term affordability and the anticipated timing of when it would become enforceable, to be reviewed by HOST staff.
4. Dwelling units built by any charitable, religious, or other nonprofit entity and deed-restricted to ensure affordability
   • Required documentation at time of SDP: Evidence of the tax-exempt status of the organization, a copy of the organization’s mission statement, and a description of the project, to be reviewed by HOST staff.
5. Projects built by a nonprofit entity to provide housing for low-income or persons experiencing homelessness.
   • Required documentation at time of SDP: Evidence of the tax-exempt status of the organization, a copy of the organization’s mission statement, and a description of the project, to be reviewed by HOST staff.
6. Projects built by federal, state or local government used for government or educational purposes
   • Required documentation at time of SDP: A description of how the project will be used for a governmental or educational purpose, and proof of property ownership via a deed or lease that documents ownership and/or use, to be reviewed by CPD staff and the City Attorney’s Office, if necessary
7. Structure that is being reconstructed due to involuntary demolition or involuntary destruction
   • Required documentation at time of SDP: Evidence of involuntary demolition or destruction such as an insurance report, report from Denver Fire, report from Denver Police, or similar, to be reviewed by CPD staff.
8. Addition of 400 sf or less to a single-unit or duplex building
   • Required documentation at time of building permit: Plans for the addition that include square footage information and dimensions, and evidence that the existing structure is a single- or two-unit dwelling, to be reviewed by CPD staff.
9. Accessory Dwelling Unit
   • Required documentation at time of building permit: Plans demonstrating that the proposed structure is an ADU, and evidence that the existing structure on the lot is a primary structure, to be reviewed by CPD.
10. Structure containing educational uses
    • Required documentation at time of SDP: Evidence that the structure is being operated by the governing board of the educational institution, and a description of the program, to be reviewed by CPD.
11. Any gross floor area of a structure containing residential development that is subject to Mandatory Affordable Housing
    • Required documentation at time of SDP: Documentation as specified by DRMC Sec. 27-229 and Section 3.IV of the Rules & Regulations, to be reviewed by CPD and HOST staff.
12. Project with a concept site plan or amended site plan submitted by June 30, 2022, and an assigned record number from the city and a final SDP approved by April 18, 2025. 

     

The Expanding Housing Affordability ordinance requires the payment of a linkage fee for all new development except new residential development of 10 or more units that is subject to the mandatory affordable housing requirement. The Executive Director of the Department of Housing Stability may reduce or waive the amount of the linkage fees that would otherwise be imposed. Any applicant requesting a reduction or waiver must demonstrate that the required fee exceeds the amount needed to mitigate the actual demand for affordable housing created by the development.

Request a reduction or waiver (coming soon)

Denver's housing costs, both for-rent and for-sale, have risen dramatically since 2010. Even with robust construction, Denver's supply of housing is unable to keep pace with demand. The community asked the city to address the struggle faced by 1/3 of Denver households that are housing cost-burdened (paying more than one-third of their monthly income on housing) by establishing a dedicated fund.

The housing fund is used to create and preserve housing for households across a wide income spectrum. The fund will support permanent housing and supportive services for at-risk residents, low- and moderate-income workforce rental housing, and moderate-income for-sale housing. 

• Read the City Council ordinance establishing the affordable housing fund

Visit Denver's Affordable Housing Fund page for more information.

Fee Schedule Prior to July 1, 2022

Some development projects may be exempt from linkage fee amount increases under the Expanding Housing Affordability ordinance. These projects are still required to pay linkage fee amounts stipulated by the 2017 ordinance that are subject to inflation-adjusted increases. To find out if your project is exempt from the updated fee schedule, view the project effective dates.

Every project logging in for a building permit must document information required for compliance with Denver’s affordable housing fee.

The affordable housing fee is assessed based on new gross floor area only (not including parking) and must be paid before receiving a building permit for the following:

• Any new square footage, except additions of 400 gross square feet or less to existing single-family or duplex buildings, and

• Converting a space where the fee did not apply into a space where the fee would apply. For example, the square footage of a garage is exempt from the fee since parking is not included in the calculation of “gross floor area.” However, if the garage is converted into living space, for example, it is considered an addition to the gross floor area of the structure, and the fee would apply (unless the addition of new space is 400 square feet or less to an existing single-family or duplex building).

The fee does not apply to zoning or trade-specific permits (mechanical, electrical, etc.). 

If your project is in an existing building and is not adding any new square footage, or if you already know your project will qualify for one of the allowed exceptions from the fee, you must still submit the affordable housing fee application at log-in before receiving a fee waiver. 

This table lists each exception allowed under the 2017 ordinance as well as what supporting materials are required to verify an individual exception. Any additional information listed in the table below must be received and verified by CPD prior to building permit issuance in order for the fee to be reduced or waived. Exceptions must be approved prior to SDP approval.

As an alternative to the linkage fee, an applicant for a building permit has the option of including affordable housing units either on, or within a quarter-mile radius of, the subject property, according to a set formula.

The forms below may only be used for projects subject to prior linkage fees.

Application Forms:

• Affordable Housing Fee Application(PDF, 207KB)
• Incentives Supplement Form(PDF, 169KB) (38th & Blake Incentive Overlay District only)
• Reference Guide for Calculating Gross Floor Area (GFA)(PDF, 441KB)
• Housing Linkage Fee - Request for Reduction or Waiver(PDF, 223KB)

Administrative Rules and Regulations:

• Permanent Funds Ordinance(PDF, 15MB)
• Incentives Ordinance(PDF, 717KB)

Denver's housing costs, both for-rent and for-sale, have risen dramatically since 2010. Even with robust construction, Denver's supply of housing is unable to keep pace with demand. The community asked the city to address the struggle faced by 1/3 of Denver households that are housing cost-burdened (paying more than one-third of their monthly income on housing) by establishing a dedicated fund.

The housing fund is used to create and preserve housing for households across a wide income spectrum. The fund will support permanent housing and supportive services for at-risk residents, low- and moderate-income workforce rental housing, and moderate-income for-sale housing. 

• Read the City Council ordinance establishing the affordable housing fund

Visit Denver's Affordable Housing Fund page for more information.

For projects providing the baseline level of affordable units to rent or to buy, the available incentives include: 

• Parking Reduction: The following alternative parking ratios may be used for all dwelling units [not only the Income Restricted Unit (IRUs)], per the DZC Article 10.4.5.2.B Alternative Minimum Parking Ratios Allowed:
  • 0.75 spaces per unit in the Suburban (S) and Industrial (I) contexts.
  • 0.5 spaces per unit in the Urban Edge (E), Urban (U), and General Urban (G) contexts.
  • 0.25 spaces per unit in the Urban Center (C) context. 
    Note: The Denver Zoning Code also includes an alternative minimum parking ratio of 0.1 for dwelling units serving households up to 60% AMI (see DZC 10.4.5.2.B for more details). The DZC also includes a Ground-Floor Retail Uses in Mixed Use Projects exemption for mixed-use commercial districts (with exceptions) up to 3,500 or 10,000 sf use depending. See DZC 10.4.4.1.B for more details. When relevant, these alternative minimum paring ratios can be combined. 
• Permit Fee Reduction: A building permit (the DRMC defines this as the commercial or residential construction permit only) fee reduction of $6,500 per Income Restricted Unit (IRU) in typical market areas, or $10,000 per IRU in high market areas with the total permit fee reduction not to exceed 50% of the total commercial or residential construction building permit fee.
• Commercial, sales, service and repair street level exemption to the linkage fee: Mixed-Use developments with any Commercial, Sales, Service and Repair uses on the street level are exempt from paying the linkage fee on the street level portion of the building containing these uses.  

A new 5-story multi-family rental development with 85 total units and 5,500 sf of street level retail is proposed on a parcel zoned G-MX-5 in a typical market. To be eligible for the base incentives, the applicant must comply with the base on-site compliance options. This applicant can either restrict 7 of the units as affordable to households earning up to 60% of Area Median Income (AMI) or 10 of the units as affordable to households earning an average of 70% AMI.  

If the applicant chooses to build 7 units at 60% AMI, the incentives would apply as follows:  

For projects providing the enhanced level of affordable units to rent or to buy, the available incentives include all of the base incentives PLUS: 

A new 7-story rental multi-family residential development with 125 total units and 5,500sf of street level retail is proposed on a parcel zoned C-MX-5 in a typical market. The site is located within ¼ mile of a transit station and is neither adjacent to nor within 175-feet of a protected district.