Amid housing ‘crisis,’ activists push for bold action | Blaine County

“The housing crisis is still with us,” said Gilarowski, a sub-manager at the Limelight Hotel in Ketchum. “It has been with us for years. And the time to solve it is now.”

The rally last May was a catalyst for some elected officials, nonprofit organizations and developers to take action, he noted, but the affordable-housing shortage is still acute. Some Wood River Valley residents live in their cars, he said, and many have moved away, unable to secure a place to live.

Gilarowski—who lives in the Northwood Place affordable-housing development in Ketchum—told a crowd of several-dozen people in Town Square that he believes the private market will not solve the problem, which has worsened in recent years as low supplies of rental units foster exorbitant lease payments and many second-home owners opt to maintain units as short-term vacation rentals.

Should local workers and residents be forced to leave town to make room for Airbnb units, Gilarowski asked. No, he concluded, because communities are made from people, not buildings.

“The time to act is now, before our community disappears,” he said.

Blanca Romero Green, a program manager for the nonprofit Hunger Coalition and a Blaine County School District board member, told the crowd that the School District is having difficulty attracting and maintaining staff, in large part because of a lack of affordable housing. The district had 46 open positions at the end of last week, she said.

In addition, Romero Green said, some 20 working-class families who live in the McHanville neighborhood south of Ketchum are facing relocation. Residents of the J&J Trailer Park and Blue Haven properties must move out by May 31, the property owner has ordered, to allow development of a new, higher-density workforce-housing project. Some will likely have to leave the area, she said.

Community activist Herbert Romero said he knows of Wood River Valley families who are forced to sleep in their cars or live in other non-traditional living arrangements, such as multiple families living in a single house. The community must look after its working residents, he said, including those being asked to leave McHanville.

“They have earned a right to be here,” he said.

Ketchum City Councilman Michael David—who has been unable to secure stable housing for some three years—spoke to the crowd as a self-described “homeless person.” Blaine County Clerk Stephen McDougall Graham said he and his family were forced to move three times in 18 months, unable to find a suitable rental unit for less than $2,500 a month.

“We have a five-alarm fire,” he said.

While the affordable-housing shortage in the Wood River Valley has roots that go back decades, it was deemed a “crisis” in recent years by numerous elected officials and analysts, as conditions reached the point of giving rise to Occupy Town Square and other grassroots movements. In part because of the COVID-19 pandemic, what was already a major problem was exacerbated by soaring real estate prices and an influx of new residents. Rents doubled or tripled, residents reported, some vacant units were filled by newcomers and long-term-rental properties were sold or converted to short-term rentals. Inventories dipped, some people left to settle elsewhere and worker shortages ensued.

A major goal of the rally Sunday was to garner support for an initiative by the city of Ketchum to raise local sales taxes to fund a variety of programs to develop new affordable housing, preserve the affordable units that exist and bring some existing market-rate or under-used units into the affordable pool. Ketchum has developed a detailed plan that aims to meet the city’s estimated need of 660 to 980 affordable units over the next 10 years. Some funding sources exist but the projects—which will inevitably range from hundreds of thousands to millions of dollars—are generally not yet funded.

One major source of funding could come from changes to the city’s local-option taxes—changes Ketchum citizens are asked to vote on in the May 17 elections. If voters approve the proposal, it could add some $2.8 million to annual LOT income—a projection based on revenues from the last fiscal year—that would be used exclusively for affordable-housing initiatives.

Currently, eligible uses for Ketchum LOT funds include transportation, recreation, capital improvements, emergency services, promoting the city to visitors, property-tax relief, and costs related to collecting and enforcing the taxes. Housing projects are not an approved use.

The city collects a 3% LOT on room sales (including both hotel rooms and short-term rentals), a 3% LOT on by-the-drink liquor sales, and a 2% LOT on general retail sales and building materials (but excluding groceries). The city is authorized by the state to collect the taxes through a law that allows small resort cities to tax specific sales categories to offset in their budgets the financial impacts of hosting high numbers of visitors. The city has estimated that visitors pay about 72% of the local-option taxes in Ketchum.

The percentages include a 1% LOT in the same sales sectors collected through a voter-approved initiative to support commercial air service in the Wood River Valley. Those tax funds are set aside and transferred monthly to the Sun Valley Air Service Board, which allocates the funding to subsidize and market commercial flights into Friedman Memorial Airport in Hailey.

The May 17 ballot proposes changing the city’s LOT law to allow the city to use LOT funds on affordable-housing initiatives and to fund the initiatives through percentage-point tax increases of .75% on retail sales, 2% on lodging, 2% on by-the-drink liquor and 1% on building materials.

Per state law, changing the city’s LOT law will need approval of at least 60% of Ketchum voters.

If approved, the amendment to the law would raise the city’s LOT percentages to 2.75% on retail sales, 3% on building materials, and 5% on lodging and liquor. When added to the state sales tax of 6% (and other lodging taxes), Ketchum would have an 8.75% tax on retail sales, 9% tax on building materials, 11% tax on by-the-drink liquor and 13% tax on lodging and short-term rentals.

The current approval of the city’s general LOT lasts until the end of 2027. The so-called “1% for Air” tax is approved until the end of 2023. Voters must renew the taxes for them to continue to be collected beyond those dates.

Gilarowski strongly encouraged Ketchum residents to vote in favor of the changes to the LOT and to encourage others to do the same. It is worth paying an extra 20 cents on a $10 cocktail or an extra 75 cents on a $100 retail purchase, he said, to help keep people housed and the community vibrant.

Bold action is needed, Gilarowski said. Services could be limited at the community pool he takes his family to because there is a shortage of lifeguards, he said, while condominiums in Ketchum are selling for $4.5 million—a price of entry only an elite few can afford.

“We are slowly selling out our community for $4.5 million condos,” he said.

However, Gilarowski suggested, real estate prices would likely go down if the area continues to lose teachers, service workers and volunteers, negatively changing the character of the community.

Bartender and graphic designer Matt Gorby, a 27-year resident, said he would rather pay a little extra on an evening out “knowing that my waiter doesn’t have to drive [50 miles] to Shoshone at 10:30 at night.”

“If [the LOT] doesn’t pass,” he said, “I don’t know what’s going to happen.”

Spencer Cordovano, a Ketchum filmmaker and property manager who serves on the city’s Planning and Zoning Commission, said the goal of having tourists pay the majority of the proposed new taxes is appropriate but locals also need to contribute a share to solve the problem.

“We all need to pay into our community,” he said.

Ketchum City Councilwoman Amanda Breen said she is worried that her 10-year-old son and his colleagues face an uncertain future in the city unless leaders take “really bold” action.

“Workers of Ketchum, unite,” she said.

Mayor Neil Bradshaw praised organizers of the Occupy Town Square movement for bringing public attention to the housing crisis and garnering support for the 51-unit Bluebird Village affordable-housing project on East Avenue, one block away from the gathering. The city approved the Bluebird Village project last year and construction is scheduled to begin later this spring.

“Let’s say yes for housing,” Bradshaw said.

In Part 2 of the series: An examination of what caused the Blaine County housing crisis, how serious it is and what the impacts have been.