Leaders in the town of Ketchum are looking to a well-established Colorado hill station to determine if its policies and programs can offer solutions to the severe housing shortage for the workforce in the Wood River Valley.
George Ruther, Housing Manager for the Town of Vail, accepted an invitation from Ketchum to speak to staff, the mayor and city council about his town’s success in recent years in adding to its inventory of worker housing units local. Addressing the mayor and council via videoconference, Ruther said Vail had achieved marked success on a front Ketchum might consider: making direct payments to homeowners to place deed restrictions on their units so that only people from the local workforce can live there.
Vail — as well as other hill stations such as Breckenridge, Colorado; Park City, Utah; and the ski areas of Lake Tahoe, Calif., share the same obstacles as Ketchum, Ruther said.
“We all have one thing in common, and that is the housing issues in our community,” he said.
Vail has built a municipal department dedicated to providing long-term housing for the workforce, Ruther said, and since 2017, has added 162 restricted housing units to the nearly 700 units already in its inventory. The city is on four years on a 10-year plan that plans to increase that number to 1,700 by 2027.
When Vail decided to tackle his housing shortage head-on, Ruther said, the city shifted him from director of community development to head of a new housing department. The city created the Vail Housing 2027 plan – a concise 15-page document – and subsequently adopted a set of policy statements.
A key idea, he said, was that “housing is infrastructure”. In making this statement, the city moved away from the loose, time-limited discussions of “employee housing” and “community housing,” which dispersed a vague responsibility for solving the problem and gave it focus.
Two other key elements, he said, are the notion that “finance is policy” and that building housing requires partnerships with the private sector. Resort towns “can’t get out of this problem,” Ruther said.
By committing to take responsibility and fund housing programs, Vail has started to make substantial progress, Ruther said. By following a three-pronged approach to setting goals, providing the means to pursue them and implementing the methods to achieve them, Vail is making progress towards adding more than 1,000 housing units to its inventory subject to deeds. , which is managed by the Vail Local Housing Authority.
“The means are really about the money,” Ruther said.
Vail is using taxpayer funds to support its housing programs and is considering whether it could implement a new tax specific to these programs.
One of Vail’s signature housing programs is called Vail InDeed, which launched in 2017. At the time, a study found that Vail had over 7,200 homes, but only 5,300 residents. They lived either in some of the town’s 1,750 occupied houses or in its some 700 units restricted by deed for local workers. The problem was clear, Ruther said: more than 4,750 homes were unoccupied, and when new homes were put on the open market about 90 percent of the time they were sold to homeowners who ultimately wouldn’t live there. .
The Vail InDeed program pays residential unit owners to place a deed restriction on their property that ensures it will always be occupied by someone who works in the area. The restriction of the act requires the occupant to work at least 30 hours per week in Eagle County, where Vail is located. There is no income limit, there is no family size requirement and there is no cap on the capital gain that an owner can achieve.
For the restriction of the deed and the alleged loss of value in the open market, the owner is paid 15% to 20% of the value of the property at the time. Vail has gained 162 units through the program, which are mostly condominiums or townhouses with two, three or four bedrooms in the city. This translates to homes for around 367 residents, Ruther said.
“We consider them to be real estate assets,” he said.
Vail has committed $ 2.5 million per year to the Vail InDeed program through funds allocated to capital improvement projects, Ruther said. The figure could be increased to $ 3 million per year, he said.
Restrictions on deeds ensure that the accommodation is for “another local,” Ruther said, and that local buyers “are not competing with someone on the east or west coast.” Investors or business owners can purchase the restricted properties by deed, but someone working in the community must live there. The Housing Department enforces the law to ensure compliance.
Elements of the private sector have signed on to the program, Ruther said. About two dozen established lenders provide loans to buyers. Some business owners, who generally don’t want to become builders, have bought properties for their employees, he said.
Ketchum City Administrator Jade Riley, who has met separately with Ruther and some Ketchum City staff, said Ketchum’s next step is to create a “global housing strategy.” Ketchum has limited resources, he noted, and is an “infant” compared to Vail when it comes to housing programs.
The mayor and members of the city council have shown their support in dealing with the crisis, starting with initiatives to finance housing in its annual budget. To begin with, the city plans to set aside for housing $ 614,000 it receives from the federal government as part of the COVID-19 relief funding under the CARES Act. The money would go in a separate line in the next city budget for special initiatives to be approved by city council.
“For me, the most important thing was housing, it’s infrastructure,” said Mayor Neil Bradshaw.
City Councilor Michael David said he would like to investigate whether the town of Sun Valley will join Ketchum in developing a housing program.
City Councilor Amanda Breen said the Vail InDeed program “looks amazing” but noted the city needs a comprehensive strategy – that “there isn’t a solution”.
City Councilor Courtney Hamilton, who advocated for Ruther’s presentation, said “this is a really exciting program for our community” and that she wants to see the city implement its vision.
City Councilor Jim Slanetz said restrictions on purchasing acts could be “a good tool,” but asked him to consider whether the positive impacts could be too long-term. Hamilton noted that the deed restrictions could have the immediate benefit of keeping a resident working in Ketchum, instead of selling a unit in the city to cash in and moving to another area.
Ruther encouraged city officials to set clear goals, “be bold” and “take risks.”