Understanding Denver’s EHA Affordable Housing Linkage Fee

What It Is, How It’s Calculated, and Why It Catches Many Homeowners and Builders by Surprise

Denver’s Expanding Housing Affordability (EHA) ordinance introduced a one-time Affordable Housing Linkage Fee designed to fund the creation and preservation of affordable housing across the city. The fee applies when new livable square footage is added through new construction, additions, or certain conversions — and it’s one of the most commonly overlooked costs during the permitting process.

What the Fee Is

The Affordable Housing Linkage Fee is a development-related charge collected by the City and County of Denver to support affordable housing initiatives. The city applies it to projects that create new usable floor area, whether residential or commercial.

Funds collected from the fee go directly into Denver’s Affordable Housing Fund, which finances housing for low- and moderate-income residents.

You’ll typically encounter this fee during the building-permit phase, after plan review but before the permit is issued.

How the Fee Is Calculated

The total fee is based on the amount of Gross Floor Area (GFA) added to a property and a per-square-foot rate set by the city.

Formula:

GFA (sq ft) × Fee Rate ($ / sq ft)

The fee rate varies depending on:

• Type of project: Residential vs. commercial

• Zoning district: Low-, medium-, or high-intensity areas

• Date of submittal: Rates adjust annually on July 1

For example, if a small residential project adds 1,000 sq ft of new livable space and the applicable rate is $8 per sq ft, the linkage fee would be about $8,000.

Why It Catches Builders and Homeowners Off Guard

Many property owners are surprised by this fee because:

• It’s not included in standard plan-review or inspection fees.

• The cost appears right before permit issuance, making it hard to anticipate.

• The definitions of what counts as “new usable space” can be confusing, especially for remodels or crawlspace-to-basement conversions.

• Fee rates change each July, and submittal timing affects the total amount due.

Without proper planning, this can easily add thousands of dollars to a project’s budget.

Important Exception: ADUs Are Exempt

A key clarification for homeowners — Accessory Dwelling Units (ADUs) are exempt from Denver’s Affordable Housing Linkage Fee.

According to Denver’s official guidance, ADUs are specifically listed among the exceptions to the linkage fee.

This means:

• Building a new detached or attached ADU will not trigger the Affordable Housing Linkage Fee.

• Plans and permits must clearly label the structure as an Accessory Dwelling Unit (ADU) so the exemption is correctly applied by reviewers.

• Other city fees (like sewer tap or water SDC fees) may still apply, but the linkage fee itself does not.

If you’re unsure whether your project qualifies, confirm early in the design or pre-submittal stage.

How to Plan Ahead

Whether your project qualifies for the ADU exemption or not, here are a few best practices to avoid last-minute surprises:

1. Confirm early – Ask your contractor or architect if your project adds new usable floor area that could trigger the fee.

2. Estimate conservatively – If not exempt, budget around $8–$10 per sq ft of new space.

3. Track submission dates – Fees update each July 1, so timing matters.

4. Document clearly – Label ADU projects properly to ensure the exemption applies.

5. Include in estimates – Add a line item for “Potential City Housing Linkage Fee” or “EHA Fee (if applicable)” to maintain transparency.

The Bigger Picture

While the linkage fee adds a layer of complexity to Denver’s permitting process, it plays a vital role in the city’s broader effort to expand affordable housing options. By understanding how it works — and when it doesn’t apply — homeowners and contractors can plan smarter, stay compliant, and keep projects on budget.

Ready to Start Your Project in Denver?

If you’re planning a remodel, addition, or crawlspace-to-basement conversion, it’s important to work with a contractor who understands Denver’s building-permit process, fees, and evolving EHA regulations.

At Stonebrook Construction Group, we specialize in crawlspace conversions, additions, and custom homes throughout the Denver area. Our team handles every detail — from design coordination and engineering to permitting and inspections — so you can build with confidence and avoid unexpected costs.

Let’s build your vision the right way, from the ground up.

📞 Call (720) 505-9748 or visit stonebrookconstructiongroup.com to schedule your free consultation today.