Housing, especially affordable housing, is a national problem. In tourism-based cities like Page, residential properties become short-term vacation rentals, making it difficult or impossible for workers to find suitable homes. This affects all local businesses, schools and essential public services. Cities in Arizona have a tougher road ahead of them because state laws tie their hands. When former Governor Doug Ducey signed SB1350 May 13, 2016, cities could no longer prohibit or regulate the spread of vacation rentals. That’s only part of the problem.

There are indirect consequences too. Developers attempting to purchase city land may claim that their new townhomes, condos or single-family homes will help solve Page’s housing shortage, but that’s a promise the state laws won’t let them keep. This limits a city’s options. 

The most obvious solution is apartment buildings. To make a profit and offset rising construction costs, developers look to multistory buildings, which are unpopular in smaller cities.

A November 2022 housing report by Arizona State University (ASU) Morrison Institute for Public Policy described the barriers to housing development. First on the list is zoning and development standards. According to the report, “Developers expressed that zoning is also a significant barrier to housing development because most land is not zoned for multifamily use. This often leaves multifamily housing developers having to rezone the land for multifamily use.” Some developers report zoning could take up to two years. A lot can change in two years – increased construction costs, supply availability and changing markets, or loss of funding.

The same time ASU released its report, Page completed its 2040 General Plan. It took a year of consulting, planning and gathering input from the community. Page City Council adopted the plan on Dec. 14, 2022, following what was expected to be the final public hearing on the matter. When Page Mayor Bill Diak asked the nearly empty chamber if any citizens would like to speak, the room was silent. Diak moved on to the next agenda item. 

On pages 2-4 of published general plan is a future land-use map with zoning boundaries. Multifamily Residential areas are marked in orange, including Vista Avenue vacant lots overlooking the Lake Powell National Golf Course. The contested parcels are referred to as Frost Park by some local residents. 

While Page is on top of the zoning, the second obstacle on the ASU report comes into play: community pushback. According to the report, “Developers receive community pushback on housing projects of all types, but those building multifamily and affordable housing are particularly impacted. Pushback typically arises during a rezoning or variance process, and concerns are over a variety of factors, such as decreased housing values, increased density, crime, traffic, and who is living in the housing. These concerns are often referred to as a Not in My Backyard (NIMBY) mentality, and developers have found it to be a key barrier in Arizona.”

An unnamed developer quoted by the ASU Report said, “I don’t think I can overestimate the impact it has on our business. Like I said, we can make the math work here in the valley. It’s finding sites and communities that will support it and not be swayed by NIMBYism. And we can meet till we’re blue in the face with folks. We can have neighborhood meeting after neighborhood meeting. We can inform, we can show examples or renderings of what the physical product’s going to look like. But at the end of the day, there’s certain groups of folks that just don’t want it in their backyard.”

As reported by AZ Central, Tom Simplot, director of the Arizona Housing Department said, “NIMBYism is not new in Arizona but we can’t expect elected officials to fight for increased density and apartment zoning, if the development community doesn’t galvanize a neighborhood about a project early on.”

Some cities and towns are more difficult for developers to work with than others. A couple bad experiences with NIMBY groups could deter developers from returning. Page, because of its isolation, also increases the costs and risks of building projects. Contractors aren’t lining up to bid on city construction projects. Often, a sole bidder gets the contract. 

It takes strong political will to move forward with multifamily housing. A relatively small number of protestors could feel like a tsunami to council members. In a small town where it’s common to run into constituents at the grocery store or at an event, the pull of cronyism is always a concern to those who don’t feel represented, those who can’t find or afford suitable housing, those working multiple jobs to make ends meet. There’s a silent majority in Page, and they’re too busy working, taking care of their families, too tired to speak out in council meetings or don’t feel their voices will make difference.

It’s no coincidence Arizona zoning in general favors single-family homes over apartments. According to reporting by AZCentral, about 878,000 acres of vacant land in Arizona is zoned or set aside for single-family homes, while only 17,000 acres is zoned or entitled for apartments.

Affordable housing should cost 30% or less of household income. If a household income is $30,000, their rent or mortgage payment should be $750 or less. Many of the elderly live on fixed incomes of $16,000 or less. 

“Anyone paying more than 40 to 50% of their income is severely cost-burdened,” Said Cindy Stotler, deputy director of the Arizona Department of Housing. “Any one big unexpected bill, such as a car repair, can cause someone to lose their home.”

The League of Arizona Cities and Towns lists some of the limitations Arizona imposes on cities that other states don’t. Here’s what the City of Page can’t do:

Require developers to have affordable units. 

Control rent increases. 

Limit corporate purchases of residential housing units.

Prohibit landlords from refusing to accept housing vouchers.

Cap or limit the use of housing as a short-term rental.

Explicitly redirect the tax revenue generated by an affordable housing development back to the developer to offset the costs of building affordable housing.

Prohibit developers from buying and sitting on undeveloped property.

Some Arizona cities are finding ways around Ducey’s problematic SB1350 law, but it’s costly. In August 2022, Sedona City Council voted to allocate $240,000 to persuade property owners to rent to local workers rather than vacationers. Sedona’s housing manager Shannon Boone studied how different tourist towns handled the problem. Boone told AZ Family that Big Sky, Montana “was able to create 30 housing units in three months, which is rapid when you consider how long it takes to construct housing.”

The City of Tucson made a change in its zoning code in 2021, allowing accessory dwelling units or backyard homes in residential zones.

The ASU report offered another workaround to state restrictions.

“Despite this, Arizona cities can adopt voluntary inclusionary zoning, which can significantly help developers save costs on projects with important incentives such as height bonuses, reduced or eliminated parking minimums, fee reductions, and expedited permitting,” the report said.

July 5, 2023, Lake Powell Chronicle reported on other alternatives Arizona cities are using to provide housing for teachers, police and firefighters. 

Page City Council approved zoning modifications to convert a 3,200 sq. ft. commercial building into a four-unit multifamily apartment complex for Page Unified School District teachers and staff.

Chino Valley Unified School District is building tiny homes. Teachers can rent a 400 sq. ft. house for $600 per month.

Prescott Unified School District is building six two-bedroom, one bath homes for four teachers, a police officer and a firefighter.

Sedona-Oak Creek Unified School District is converting a school building into apartments to help recruit teachers. 

It could take years, if ever, for the state to return power to cities, counties and towns. In the meantime, cities must get creative.