The problem is the contractor left the work halfway done and he did not pull any permits (siding to be exact).

The biggest question is going to be if the city will allow you to get a permit for whatever you are doing.  

I've never heard of someone investing in a sober living facility... do you need certain permits for that?

So, I would just make sure you have any paperwork (if available, permits, etc) that show the extra sf is legal, but I wouldn't assist the tax assessor in raising your assessment in the future.

Find some example houses in your area that were recently built and ask/search the permitting records for the GC.

We had a bump on the road as we took out permits to close out the garage and added 6 new impact windows, which all in all took about a 1 year and a half and costs more than we initially thought.

The most difficult part about these types of flips is dealing with the city for permits and inspections.

Also, I find it helpful to ask about their permit process, if applicable, and how long it has been taking for their team to acquire approved permits.

What was the permitting and zoning process like with the City of Denver?

If they find out that you permitted them to live there under those conditions, there may also be repercussions.