Home & Design August 31, 2010

A Tale of Two Cities

While Aspen’s affordable housing market expands and a real working community prospers, Sun Valley’s flounders.

Ketchum architect Derek Ryan considered himself fortunate when he moved into an affordable housing condominium in downtown Ketchum last September. The deed-restricted one-room flat is decorated with odds and ends of his bachelor life, including several guitars. The apartment is on the second floor of the Idaho Independent Bank at the corner of Main Street and Fifth Avenue, and when Ryan opens his windows on a sunny summer afternoon, his home fills with Main Street’s bustling sounds.

The apartment’s west-facing orientation couldn’t be better. “We have views of Baldy,” said the proud, first-time homeowner.

Ryan’s home is a considerable change from the nearby apartment he lived in previously. There, a lack of storage meant his living space was crammed with the “tools” of his ski bum lifestyle. The guitars shared wall space with multiple pairs of skis and pieces of seasonal outdoor gear.

Ryan didn’t mind the clutter, but he’s evidently happier with his new digs and a large downstairs storage space. “I don’t have to sleep with my skis anymore,” he quipped.

Though most of his local friends cheered Ryan’s successful purchase of a home through the Blaine County Housing Authority (BCHA), some did not. He counted two acquaintances who were “bent out of shape” when he told them of his good fortune, as if they believed his participation in the program reflected poorly on him. “Like maybe I haven’t paid my dues,” said the ten-year Ketchum resident.

Despite such social setbacks, Ryan feels a greater affinity for Ketchum now that he’s a homeowner. “It has given me an increased sense of connection to my community.”

Ryan isn’t the only recipient of verbal attacks for his participation in the affordable housing program. Rebekah Helzel, the executive director of the ARCH Community Housing Trust, has received anonymous threats from callers who would label her a “communist,” an odd charge to the ears of this former investment banker. “It’s completely bizarre,” she said.

Simple shelter, that most basic of human needs, has become a complex problem in resort communities across the West. In towns such as Sun Valley and Aspen, Colorado, housing is typically too expensive for most local residents, and rentals are in short supply.

But in Aspen, that famous redoubt for the wealthy, housing programs far more effective than Sun Valley’s were implemented decades ago. There, various laws and ordinances were passed with foresight when working people first started being displaced. Today, these laws help locals remain in their picturesque Roaring Fork Valley.

Compare this experience with ours in the Wood River Valley. Here, countless committees have been formed to study, discuss and re-study ways to keep Ketchum and Sun Valley from becoming exclusive playgrounds for the rich, famous and comfortably retired. But Sun Valley’s affordable housing program is a modest enterprise, typified through the years by fits and starts of progress.

The BCHA is at the center of the campaign. Since its 1997 founding, the group’s small inventory of deed-restricted homes and rentals has not surpassed roughly 100 units. In large part, this has been due to the few tools Idaho’s legislature has provided local communities to address the issue.

“The options we have available to us are extremely limited,” said Helzel. Even a very modest real estate transfer tax (RETT) would be a gold mine for the area, she said. The only problem is that Idaho law doesn’t allow local governments to establish RETTs, a tool that has been the bedrock of the affordable housing efforts in Aspen.

In 2008, the Blaine County Commission reluctantly voted to repeal the county’s “inclusionary housing ordinance,” its best tool for creating affordable housing, backing away from a looming showdown with the state government. The law had mandated that developers set aside 20 percent of their residential projects as affordable, deed-restricted homes.

The county made the hard decision to repeal the ordinance after a similar law in McCall, Idaho, was invalidated by Idaho 4th District Judge Thomas F. Neville, who ruled that the affordable housing requirement was unconstitutional and an illegal tax. In doing so, a measure that could have funded the construction of affordable homes for people like Derek Ryan was lost.

Today, Sun Valley and Bellevue no longer have such housing ordinances. Sometime later this year, Hailey City Attorney Ned Williamson is expected to advise elected officials on whether they should repeal their own similar ordinance.

In Ketchum, city leaders adopted a different strategy or compromise. The city tried to entice developers to include deed-restricted units in their plans by allowing them to build beyond the city’s regular height and density caps. Blaine County is following suit and developing similar incentives for residential builders. Results have been mixed, and frequent permissions to break codes on height have created an atmosphere of confusion.

Clockwise from top left Rebecca Helzel, executive director of ARCH Community Housing; John Flattery, executive director, Blaine County Chapter of Habitat for Humanity; Derek Ryan, architect and affordable housing owner. Photographs Tal Roberts


But in Idaho, where state laws are difficult to sidestep and conservative politics are dominant, incentives like these look like the only current alternative to mandating affordable housing. The strategy may also be winning over some free-market-minded developers. Nevertheless, sources for this article pointed out that opposition to any affordable housing measures in Sun Valley remains strong.

According to Helzel, the residents she knows who oppose housing laws are often the same people who could benefit from them. No matter the statistics, they cannot be convinced. “They see it as too much of a helping hand,” Helzel said.

John Flattery is a former housing authority board member and currently the executive director of the new Blaine County chapter of Habitat for Humanity. He calculated that the county’s median family income of $74,800 can afford a $220,000 home (based on the accepted practice of devoting no more than 30 percent of one’s total income to housing.) But in the Valley’s housing market, even after the downturn, a $220,000 home is a rare bargain. “There’s a huge gap between what people can afford and what people can buy,” Flattery said.

A 2006 assessment of the Valley’s affordable housing needs—a rewrite of the original 1997 study—estimated the area was more than 1,200 homes short of fully supplying the demand. Flattery once had grand ideas that the housing gap could be filled. But he has grudgingly downsized his goals; his resized ambitions are to simply tackle the issue one home at a time.

“If you do five homes (a year), every ten years you’ve got fifty,” he said. “We’ll chip away at it.”

But Flattery doesn’t like this compromise. He cited the Blaine County School District as an example of a segment of the community most impacted by the lack of housing. The school district typically experiences a 10 percent annual turnover rate among its roughly 800 employees. That means it must find and hire 80 people willing to move to an area with very few desirable and affordable homes.

“It’s damn near impossible,” Flattery said.

What’s more, Helzel said she believes that when the economy turns the corner and the strength of the housing market returns, the housing situation won’t necessarily improve. Banks are no longer showing the kind of willingness to provide loans to prospective homeowners as they once did, and this will provide fewer families the opportunities to put down roots in the Wood River Valley.

Helzel and Flattery both wonder where the new hotels that are set to be built in Ketchum in the coming years will find their workforce.

“Where are we going to get the employees to make these hotels successful?” Helzel asked. “Where do they think they’re going to come from?”

And, ultimately, where will they live?

The story of high home prices and itinerant workers is not unique to Sun Valley. Resort towns across the United States face similar hurdles, but Aspen provides a distinct contrast to the Wood River Valley’s struggles.

Both communities share pasts steeped in ski history, mining and ranching. Both share astronomic land and home prices, seasonal economies, small employee pools and high costs of living. Aspen and the Roaring Fork Valley are larger than Ketchum and the Wood River Valley, in both population and physical size. Aspen boasts four ski mountains to Ketchum’s two, and with that additional ski acreage come additional guests, traffic, glitzy boutiques and a certain loss of the coveted small-town vibe.

Ketchum has remained, for better or worse, a sleepy place. And for years, decades even, many Wood River Valley locals have confidently said, “We don’t want to be Aspen.”

Ironically, the feeling in Aspen is sometimes mutual. “Aspen looks at Sun Valley and says, ‘Thank God we’re not like them,’” said Allyn Harvey, a onetime editor of The Aspen Times, who grew up in Aspen. Harvey saw his town’s dramatic socioeconomic shifts, and the efforts to confront those changes head-on to maintain economic diversity.

As land and home prices and the influx of wealth escalated in Aspen in the 1970s, community leaders watched as skyrocketing prices loomed above their town’s working-class base.

“Rather than wait or try to convince the real world we had issues, we solved it ourselves,” said Tom McCabe, Executive Director of affordable housing for the City of Aspen and Pitkin County. By the late 1970s, both Pitkin County and the city of Aspen kicked off an affordable housing program that today ensures locals can live where they work (and play).

In Ketchum, the future for middle-class families is uncertain, despite the attempts of several committees examining and re-examining the problem. “Study and planning is a good no-growth policy,” said McCabe.

“Aspen began to take responsibility for its demographic mix in the late ’70s,” said Harvey. “They made it affordable so people could live and work in the same place. I think it was actually quite visionary what they did.”

By early 2010, Aspen boasted more than 2,800 affordable homes, including about 1,200 rentals, varying from studios to family houses. That figure grows annually. With an average of 1.75 people living in each affordable housing unit—nearly 5,000 people total—a large and vibrant community exists behind Aspen’s golden curtain.

Aspen did it with the help of RETT, which funnels 1 percent of all real estate sales into Aspen and Pitkin County’s affordable housing program. But tools like these are not available to local governments in Idaho. Nor, as it turns out, are they available elsewhere in Colorado anymore.

“With the kind of prices that Aspen commands, that RETT spun off a lot of money,” McCabe said. Colorado real estate interests successfully killed the transfer tax in the 1980s, claiming it hindered home sales, but the law was grandfathered in for Aspen. It need only be renewed by Aspen voters from time to time. The latest renewal, in 2000, passed by a 40 percent margin.

“I think RETTs are an interesting tool, and it’s too bad they are not available (elsewhere in Colorado) anymore,” Harvey said, adding that the tax could also be used to help fund and expand other community services for which the astronomical real estate market creates demand, such as police and fire, schools and daycare.

Affordable housing “creates a vitality and a variety of businesses,” Harvey said, reeling off a list of pizza joints, bars, restaurants, and music venues that rely on local workers for patronage and help. McCabe said turnover in jobs, whether with the Aspen Skiing Company, a restaurant or the fire department, would be “huge” without affordable housing; because people can live where they work, “there is a lot of community pride that would not exist otherwise.”

In Aspen and Pitkin County, when a developer arrives with a plan, affordable housing is among the first topics brought up. It’s a sort of can-do approach that looks at all options and opportunities for creating affordable housing, McCabe said. “It’s not a hard and fast formula. It’s ‘let’s find a way to make it work for everybody,’” he explained.

What the City of Aspen and Pitkin County typically strives for is to provide affordable housing for 60 percent of the workers in the city and county. In practice, this means that developers must provide enough housing to meet the needs of 60 percent of the employees generated by their developments.

Contrast that with Ketchum’s waivers of affordable housing requirements for recently approved downtown hotel projects. For local housing advocates like Helzel and Flattery, the trend is maddening.

Aspen developers have not always gone along with these ordinances peacefully. “The normal valiant opposition,” McCabe called it. “The development community is not real fond of exactions and restrictions. But here, we realize that development has impacts if you let a developer hit and run your community.”

Can the same be said of Ketchum, Sun Valley and the rest of Blaine County? Will local leaders prioritize affordable housing? Will state legislators consider exceptions to Idaho law for unique towns like Ketchum?

Derek Ryan is confident. Compared with when he first moved to the area—a time, he said, when far fewer locals and developers believed in affordable housing programs—there’s a much greater appreciation and understanding of the local housing need. Continued “patience” and a “tireless” commitment are necessary to progress, he said.

Ryan is hopeful that more of his friends and colleagues will be given the same opportunity he was. “I think the trend is going in the right direction. More people in the community understand the problem. I think we’ll get there.”



This article appears in the Issue of Sun Valley Magazine.