ISSUE# 42: Who's Housing Crisis?
Ketchum is using the narrative of a a housing crisis to replace low-profit locals with high-profit tourists while depressing tourism industry wages
We have a housing crisis! It must be true because everyone says so.
But a housing crisis for who? For locals? For essential workers? For employers? For retirees?
We had a housing crisis for locals when the Bradshaw administration first came in almost seven years ago. Those neighbors are now gone, forever, thanks to the City’s inaction. This locals housing crisis was caused by the passive acquiescence of our elected officials as almost every long-term rental in Ketchum went to Airbnb.
That transition is largely complete, and according to the City Administrator, it is irreversible. So now the City is moving on to the next phase of the plan to squeeze out the last vestiges of our remaining middle class. Here’s a text I recently received:
Perry I can't tell you where I got your number but I'm a local employee. The city of ketchum is forcing me out of my home. Because I do not meet the standards for their indentured servitude program. I like to tell my story but I need help. Let me know if you would be willing to help me.
I’d rather help this person keep their housing than tell their story.
For Whom Are We Solving the Housing Crisis?
If we aren’t helping locals with our program, who is benefitting?
The City’s primary effort in housing is the Bluebird program. This has been architected by Mayor Bradshaw. He started it over ten years ago when he ran KCDC and pioneered Northwood Place, 36 units of low-income housing next to the fire station.
As Mayor, he championed Bluebird. He proactively sent that RFP to just one developer, for-profit GMD, whom he worked with on Northwood Place. Based on GMD’s requirements, he led two changes to the zoning code to make this project profitable for them. Now, we are stuck with permanent changes to our zoning code that practically guarantees more massive four-story, lot-line-to-lot-line low-income housing projects in the commercial core of Ketchum.
When GMD asked the City to pay them $1mm in cash, the Troika agreed. When GMD upped that ask to $4mm in cash, the Troika agreed. At their direction, ALL of Ketchum’s in-lieu-of funds went to Bluebird.
Under their leadership, the City has built its housing department bureaucracy to bring us more Bluebirds. I count four city staff members who are full-time on housing, plus significant time from at least three others, plus a major consultant contract for the misleadingly named “Lease to Locals” program.
The next Bluebird is slated for the south parking lot at the YMCA; after that, one will go up on the site of the Lift Tower Lodge. After that, they plan the mother of all Bluebirds, twice the size of the one they just built, almost at the foot of River Run.
This program will build hundreds of income-capped units, most of which are located on some of the most valuable land in Idaho (walking distance to ski lifts).
Don’t we need all these units? Won’t this program go a long way to solving the housing crisis?
The answers are no, and no
This approach to housing is designed to generate low-quality housing for low-income tourism industry workers so that their employers can keep their labor costs low.
Worse, it doesn’t even always achieve that goal. Since it can’t require a tenant to work, similar housing in other mountain communities has become highly desirable for… retirees. Does Ketchum need more retirees?
The Squeeze-Out Math
The current program advances the replacement of locals, who apparently aren’t very valuable to Ketchum’s economy, with higher-value tourists and new arrivals willing to work for less than Ketchum’s prevailing wages in exchange for taxpayer-subsidized housing.
Here is a live example of how our Council prioritizes people who don’t live here over people who do live here.
First of all, why does BCHA need to advertise apartments? Don’t they have a waiting list? The waiting list was their rationale for lobbying the City Council for Bluebirds. If they have to advertise to fill their units, what does that say about their waitlist? Are they building housing where people on the list don’t want to live? Or are they creating their own demand?
Let’s do the math on how destructive the income caps are.
Take two starting BCSD teachers who live together. Each makes $53k for a total of $106k. A 2 BR market rate in Ketchum is about $3k/mo for a crap apartment. They pay just under 30% of their pretax income in rent. They risk being evicted at the end of their lease when their landlord decides to make more money in the short-term rental market.
Yet a two person household can make no more than $73k and pay just under $1500 for a brand new apartment in the center of Ketchum. They will pay only 25% of their pre-tax income.
This creates perverse incentives.
On an aftertax basis the teacher couple is financially better off if one of them quits their job and works part time just enough to stay under the income cap. The non-teacher not only pays no income tax, they qualify for the EITC.
They get a brand new apartment care of the taxpayer that they can’t be evicted from.
Is this what we think is good for Ketchum? If my analysis is incorrect, please prove me wrong.
We Make Decisions Based on Narrative Not Analysis
The City is making these decisions that cost its taxpayers tens of millions of dollars with inaccurate data and flawed analysis. Worst of all, they aren’t even consulting with the people whose problems they purport to solve.
The City says Bluebird will house BCSD staff. Why house BCSD staff in Ketchum when the majority of jobs are in Hailey and south? Isn’t the Bluebird rationale that people won’t need cars because they will walk to work? Or is that just a story they tell us?
Ketchum has never surveyed employers about their workforce housing needs or employees about their housing needs. Doesn’t that seem like something… obvious?
Instead, the City rationalizes its program with consultants hired AFTER big decisions have been made1 and with studies that are replete with numbers that are literally made up.2
There Is A Better Way
What should the City be doing? They should act responsibly with our limited resources to maximize the outcome that will benefit Ketchum residents most. Focus first on locals, next on essential workers, and let the tourism industry take care of itself.
They should track our workforce challenges with data so we can optimize the allocation of our scarce land, money and community character. Instead of wasting money on consultants that produce the study to justify a narrative, they could spend that money on
Annual survey of employers
Annual survey of employees
Geolocation data on commuting trends
They aren’t doing any of that. They have no plan to do any of that. They are full speed ahead on destroying what remains of our community by spending massive amounts of our resources to house the the wrong people in the wrong way in the wrong buildings at the wrong places.
They just paid someone to tell them to put Bluebirds at the Y and Lift Tower Lodge. That plan had been in place for quite some time as is obvious from the Housing Director’s updates to the Council.
The “Nexus” study is an embarrassment to the profession of statistics.
As always Perry, thank you for your brilliant analysis.
By identifying the cascade of failures you so clearly identify as a "housing crisis" the corrupt local establishment is better able to sell public subsidy (corporate welfare) of resort employers. This while most available rentals have been converted to STRs to the benefit of tourism at the expense of available housing for the workforce. If it is a "crisis" they are better able to disguise and attempt to distance themselves from the corruption and incompetence attached to the aggressive execution of their malignant growth agenda.
It will be interesting to see what happens if it does not snow this winter, though some have said "El Nina" promises an abundance of precipitation. The question is will it be frozen or liquid. A ski resort on mountain with a base elevation of 6K feet and a peak elevation of 9K is inevitabley doomed in the age of irrevesible climate change. They always project 2050 and the end of the century for such dramatic changes. I predict the end of this decade, as scientists without an agenda suggest an accelerated climate change process, a "snowball effect" so to speak, but on Baldy without the snow.
I'm outta here for a while, in a better place not caring much about what happens around here anymore and also avoiding the intensifying election hysteria.
Again Perry, we need the smart ones like you volunteering to hold a mirror up to the moneyed-interest insanity which the corrupt local establishment attempts unsuccessfully to medicate with relentless virtue-signaling and green-washing because legitmate planning for growth, accountability, and transparency are too difficult. The local establishment is identical to one of the the presidential candidates and his VP, they just make $h!t up, and everyone goes along because it is apparently too much work for them to inform their opinions, and as you relentlessly expose, the facts just don't matter!