ISSUE #44: Ketchum Plans to Raise Taxes/Spending for More Bluebirds and Turn Away Local Workers

You cannot make this stuff up

Oct 25, 2024

Did You Fill Out the Town Square Survey?

The City of Ketchum wants your feedback on the plan to renovate Town Square. They sent out an email with a survey. If you didn’t get it, here is a link to it. https://www.projectketchum.org/town-square/

I think it looks pretty good! But do you know what info is missing?

How much this will cost
What the incremental maintenance budget will be

This is the norm for Ketchum. They never give us the whole story. Never a cost/benefit analysis. They put out surveys like this, and then the staff goes to the Council and says: “We got community feedback, and they all want to do what we were going to do anyways.” They do this all the time.

It is dishonest.

Who Gets to Live in Bluebird? What Happened to “Locals Preference?”

At the City Council meeting on Monday, Mr. Hutchinson noted that no one knows when the building will be open for tenants, and the Council has yet to receive any updates. This property has consumed almost $20mm of Ketchum taxpayer resources—you would think there would be regular public reporting. This is even more troubling as Mr. Hutchinson is on the Board of BCHA. You would think he could get some answers.

Bluebird was approved by the Council over six years ago and is still not occupied. Look at all the housing built by ARCH and WRCHT in that time—combined they have less overhead than Ketchum’s Housing Department.1 Maybe we are going about this the wrong way?

Mr. Cordovano noted he is getting a lot of inbound, and locals are being rejected for housing in Bluebird. BCHA has rejected two locals who have lost affordable housing, one of whom is disabled.2 I quoted another situation in Issue 42.

This is not unique to Bluebird. At the last BCHA Board Meeting, staff noted that they turn away many local workers who can’t afford market-rate housing, yet do not qualify for not just Bluebird, but ANY of BCHA’s units. It begs the question—who gets taxpayer-funded housing if it’s not local workers?3

During the September BCHA board meeting, the Executive Director admitted that locals are the secondary priority. This is a violation of BCHA policy.4 As I noted in Issue #22, Bluebird was sold with many ~~lies~~ misrepresentations, local preference being one of them.

Bluebird Incents People to Go From Full-Time To Part-Time Work

Also, in that issue, I do the math that shows that a couple who want to live in Bluebird is better off on an after-tax disposable income basis if one of them quits their job. It is one of the dumbest economic incentives I have seen.

Is this on purpose? It might be. Think about it. Isn’t BCHA better off saying their tenants don’t make a decent living? The lower the incomes in Bluebird #1, the more they will use that fact to justify Bluebirds #2 and #3. They are literally going to depress incomes in Ketchum with this program to justify their existence.

BCHA lacks demand for its units

We are supposed to have a housing shortage. If that is true, why isn’t there ready demand for BCHA units?

BCHA has been advertising Bluebird and other properties it controls in the IME, on the website, and on Instagram. But don’t they have hundreds of people on their waiting list? What gives? Is the waiting list just a political tool for them?

At one recent BCHA meeting, a local landlord stated that one of his BCHA rental units has been empty for two months. 70 people on BCHA’s waitlist were evaluated for tenancy—no takers. He wanted to raise the Category limit, but the board suggested he lower the rent and eat the loss. He also informed the board that he had been in discussions with the Housing Director for eighteen months about selling a rental unit to its long-term tenant (at the tenant's request) and that the tenant meets the deed requirements.

A Current Example of The BCHA Bureaucracy Black Hole

A deed-restricted ownership 2BR unit in Elkhorn has been empty for over three months.5 Like me, the BCHA chair expressed surprise that this wasn’t purchased immediately. Fifty people on the waitlist were qualified for this unit. 38 of them didn’t respond.6 Single people, who might meet the income restriction, aren’t allowed to buy it, as it is 2BR. Two-income households make too much money to qualify. BCHA refused to let the owner rent it to a local worker while they try to sell it.7

This Blaine County teacher (aka, “essential worker”), who earned their way out of needing taxpayer-subsidized housing, is now paying for two homes. This seems counter to the objectives of community housing. The Housing Director suggested they apply to Blaine County Community Foundation for financial assistance.8 She noted there are five months of inventory under $500k for sale in Blaine County (i.e., supply is greater than demand).

Why doesn’t BCHA/Ketchum just buy the unit rather than putting this person through hell and leaving a home empty? We know they could do this, as this year they bought two condos near the Y.9

Isn’t There a Line for Housing?

To see how the process for BCHA’s housing waitlist works, I filled out the online pre-application.10 You can find the application on their home page. https://www.bcoha.org/

Give it a shot. See if it makes sense to you. Then, see if the email you get after filling out the form makes sense.

I was left scratching my head about how they allocate housing. If you can figure it out, please share it with the group.

Housing Action Plan for Year 3 Passed Unanimously

Despite the Bluebird debacle, the Council unanimously adopted the continuation of the Housing Action Plan. Here is what the Ketchum Housing Department plans for the next year:

Plow ahead with two more Bluebirds. One on the Y parking lot and one to replace the Lift Tower Lodge with something about four times the size.
Raise taxes. Raise the LOT. Raise HOA contributions to housing. Get more money out of the Ketchum budget. They want to increase their spending by 50%.
Increase the housing department bureaucracy. Hire more people into the department, plus hire a consultant.
Become less transparent. Hide from the public what the Ketchum Housing Department does for BCHA. Council Member Hamilton congratulated them for doing that!
Send more Ketchum taxpayer money outside of Ketchum by giving cash to BCHA, BCCF, and the county mediation program. They plan to send 20% of their budget (your money) outside of Ketchum.
Ketchum taxpayers will fund 100% of BCHA staff expense.11. That cost is $477,910.
More propaganda. They plan to continue to use taxpayer resources to market their plan while not supporting alternative views.12

My favorite line from the staff memo:

“Since the Housing Department is still in start-up mode and staff are overwhelmed and overworked, staff request fewer actions this fiscal year.” 13

It is probably hard for them to work on non-Ketchum activities and work for Ketchum while attending all those conferences. We should end the conflict of interest of the Ketchum Housing Department, which also serves as the staff of BCHA. That might make their jobs less confusing.

Also, how is something over two years old in “startup mode?” And maybe they could spend less time (and money) on trips to other mountain resort towns (we paid for two staffers to spend this week in Bend). The whole thing makes me think of a college project that got funding from the student council.

My second favorite line:

“Staff did not engage stakeholders or community members for this year’s update outside of informal feedback received year-round.”

In other words, it doesn’t matter what the residents want; they will do what they want to do. As they replace Ketchum's middle class with Bluebirds, they will become more “accountable” to the people they hand housing to (now 4% of Ketchum housing units—that will more than double). As we should learn from Aspen’s experience, this is a form of vote-buying.

They reported that support for their work has dropped from 38% of the community to 34%. No matter. Their budget is going up 50% next year, regardless.

The presentation was a mess of obfuscation of what the Ketchum staff has done to support housing for people who do not necessarily live or work in Ketchum, along with assertions about housing unsupported by data.

The only Council Member who pushed back on these priorities was Mr. Cordovano, who noted that most of the current people working in Ketchum don’t qualify for Bluebird as they make just a little bit too much money. It is a feature, not a bug, of the Troika’s Bluebird program.

Ketchum’s governance process

Not one of the Council Members listed building Bluebirds as their top priority. Yet they unanimously voted to adopt a Housing Action Plan that commits the vast majority of taxpayer resources to Bluebirds.

This is why I sound like a broken record: “Don’t listen to what they say; watch what they do.” Their rhetoric rarely aligns with their actions.

But Wait, There’s More!

It was a busy Council agenda on Monday. The Mayor tried to jam through a lot in the consent agenda, but Mr. Hutchinson and Mr. Cordovano pulled several items out for discussion.

For example, handing over $100,000 of taxpayer money to for-profit 5B Productions for their multi-day street party during the World Cup was indeed discussed. And then unanimously approved. 5B will be charging $5,000 for VIP Access. One would think 5B could afford to reimburse taxpayers for cleaning up their mess.

The Mayor’s agenda made no provision for public comment.

A Rare Win For Locals—Night Bus is Back!

Kudos to Council Members Hutchinson and Cordovano. They accomplished something that none of the Troika even attempted in their six years in office—they added accountability to the City’s contract with Mountain Rides—one of our largest expenditures of public funds. This is one of the first examples I can remember of where a Council Member got something for the residents and working people of Ketchum:

He got them to commit to restoring late-night service on the Valley Route seven days a week,
accommodations for bikes on the Valley Route
quarterly reporting on rider stats (incredibly, the Troika has never asked for this—or any reporting of how our money is spent)
a commitment to work towards route optimization (one of my pet peeves; glad to see it addressed)

Now, if they could get the Mayor to resign from Mountain Ride’s board of directors and replace him with someone who knows something about transportation and who will stick up for Ketchum taxpayers (the biggest City contributor to Mtn Rides).

The Ketchum Budget Only Moves In One Direction

Council Members Cordovano and Hutchinson also pushed back on the staff recommendation to spend money on a sidewalk on 5th St, which will be wasted when a neighboring property gets redeveloped.

As one would predict, Ms. Breen jumped in to support spending the money. Hamilton and Bradshaw then voted along with her to spend the money. This is one of the many examples of The Troika’s iron grip. They almost always vote as a block—they control every decision made in Ketchum.

The staff set up the Council to approve a budget amendment at the November 18th Council Meeting that will put another $1mm toward housing and $1.8mm toward capital projects. As I have said in a previous post, Ketchum’s budget is more a guideline than a commitment. If they can get more money from us, they will spend it.

How will that $1mm for housing be spent? You know the answer to that: more Bluebirds! While Council Member Cordovano wanted to restrict it to housing preservation, the Mayor spoke out against that in the name of “flexibility.”

The extra $1.8mm for capital projects? As the budget director noted, that sounds like a lot, but it will not come close to covering the deferred maintenance accumulated during the Bradshaw administration.

Meanwhile, this administration has increased the City debt load by $25mm.

KURA: The Definition of Insanity?

I logged onto the Monday KURA meeting late. The meeting was not broadcast live on KURA's website, and no video link was provided to the public.

Mr. Lipton made the same complaint he usually makes—that KURA pays for things at the request of the City but never gets to see what they paid for. In this instance, it was the consultant study for what to do with what Mr. Lipton called the Starbucks building.14

I got a good laugh over this, as it was funny on multiple levels.

First of all, he called a spade a spade. No locals call that building the Visitor Center because it is functionally a Starbucks. Loved that.
Second, he has often made this comment but doesn’t do anything about it. It makes him look like he is sticking up for KURA’s independence from the Mayor. It’s like Lukashenko trying to be independent of Putin.
Third, he acknowledged that KURA paid for something that wasn’t in its purview as a URA. It is not supposed to be paying for consultant soft costs. It is supposed to pay for the hard costs of improvements that raise the tax base in the urban renewal district.

Our KURA ignores that and does whatever the Mayor asks it to. He appoints the KURA members and uses KURA like a piggy bank to keep expenses off the City budget. It is terrible governance, but it is the norm for this administration.

Mr. Lipton confirms the definition of insanity—doing the same thing repeatedly, hoping for a different outcome. The City frequently asks for KURA to pick up its soft costs, and KURA almost always agrees. After all, two of its commissioners are City Council Members. So when Mr. Lipton complains about it, what does he expect to happen? Nothing will change unless KURA’s behavior changes. The next time the City asks KURA for help keeping an expense off the City books, KURA should say no.

But I don’t expect them to do that because I am not (yet) insane.15

The substance of this meeting was to hear from Executive Director Frick about the status of the Washington Lot development. Given the overwhelming negative feedback from the community, the P&Z has objected to what KURA approved for the site as being too boxy and with insufficient parking. This means the project needs to be redesigned.

This is a win for the community. At the very least, it will delay the project. It might even kill it. This is especially true if the delay persists into 2026, when we will have a new mayor and two new city council members who, hopefully, will be responsible stewards of Ketchum.