THE BUZZ: House of Cards
Families are faced with the prospect of homelessness after an affordable housing fiasco.
JACKSON HOLE, WY – Connie Jones has no problem being the “face” of the housing crisis. She wants to make sure her landlords read this story and never forget her. Jones and her family—husband Cory and their autistic son Riley, 8—were told their place is on the market, currently listed and expected to sell soon. They hadn’t been there long enough to pay the second month’s rent when they got the news.
Before you stop reading because you think you’ve heard it all before, wait. Yes, the tragic tales, one after another, begin to numb residents to the real suffering. The Jones family has received a bad deal like so many others. But here’s the kicker: The landlord is not a greedy, absentee owner looking to gouge lowly tenants. The Joneses landlord is Teton County, specifically, the Housing Authority.
Pattern of nonperformance
When the Jones family moves, it will be their seventh new place in as many years since they arrived here from California. All along they’ve put up with the usual: black mold, savage rent hikes, no yard to play in, and cattle call open houses for rentals that attract 20 to 30 applicants outbidding each other before they even see the bedroom closets.
“My husband and I are at the end of our freaking ropes. The amount of stress is unbearable. I’m completely devastated. I’m inconsolable some days,” Connie Jones said. “It’s been one rough damn day after rough day, and I’m the one who has to go home and look into my kid’s eyes while I tear down his posters from the wall every year.”
The Jones family rents at 3405 N. Cheney Lane off Teton Village Road. They scored the rental after three tries at housing offered by the Authority and diligent classifieds watching. In April of this year Jones was told she won the lottery for the Mantey property (Cheney Lane).
“You should have seen the celebration we had when we moved in,” Jones said. “Riley is outside now every day where he can be free. It’s heaven.”
But winning was losing for Jones. The events that would lead to her ousting were set in motion 15 years ago when the County began a long legacy of botched housing efforts. The latest project in question for the County is The Grove, a project that included a $2M spreadsheet error and an $8M increase in cost estimates for Phases 2 and 3. Commissioners were so frustrated by the venture they pulled the plug on the Authority for Phase 3, handing the project to Habitat for Humanity against the agency’s protests, and eventually dissolved the Authority altogether.
Housing hang-ups began long before that for county officials. The Authority made its first attempt at collecting revenue through SPET (special purpose excise tax) in 2001. Prop 8 asked for $9.3 million from voters for funds that would include the “acquisition, planning, and improvement of properties … to be utilized for affordable housing.” Half of that money ended up in 5-2-5 Hall and The Grove—a development that is now scheduled for completion in 2021. Another $1.2M (and an additional $750k in 2006) went toward purchasing a five-acre parcel next to the Aspens Market (Rains property) that has sat vacant ever since.
The Housing Authority’s former director Christine Walker heralded the Mantey and Rains purchases at the time as great investments in the organization’s land banking program. Plans to build dense affordable housing projects on both never got off the ground, even though the agency’s website still reads: “All of these properties will eventually be used for affordable housing.” In fact, none of them will be.
When county commissioners attempted to upzone the Cheney Lane parcels, neighbors objected and one next-door property owner, lawyer Peter Moyer, sued.
“It’s been 10 years and what have they done there?” Moyer asked. “The Housing Authority got nearly $10 million in 2001 for their land banking program and another $5 million in 2006, which barely passed by 31 votes. The intent was to not have specific projects but to bank the money. Then they paid $1.7 million for a commercial lease on [260 W. Broadway where the HA’s offices are located] and did $200,000 in office renovation—empire building while no affordables were being constructed. They overpaid on the [Rains] property. It was appraised at $950,000 but the Authority shelled out $1.95 million for it.”
But according Lisa Potzernitz of the Joint Affordable Housing Department, “our original outlay for renovation was $128,000; $75,000 of that has been reimbursed by the tenant in suite C and the rest is to be paid back with 8 percent interest over the next five years.”
Moyer’s suit went all the way to the state supreme court, where judges agreed that land banking was probably not a proper use of taxpayer money derived from SPET. It was enough to scare off any more talk of developing Cheney Lane.
Smokey Rhea isn’t the only commissioner a bit gun-shy after the pushback at Cheney. “We’ve already been told if we try to change things at Cheney, we are going to be sued. I don’t think we will ever get high density in the Cheney Lane. We saw what happened on Teton Village Road [at Bar J], before it even hit the BCC. When some choose to go the legal route, and that’s absolutely their right, it slows us down. It’s damned if you do and damned if you don’t,” she said.
Commissioner Paul Vogelheim still believes Cheney Lane is an appropriate place for greater density but he’s no longer ready to die on that hill. He’s now eyeing places like Hog Island, around the new elementary school.
“This was public money invested and a decision made without commissioners,” Vogelheim declared, though the BCC, led by then-chair Sen. Leland Christensen, did give the OK to purchase the Mantey property. “At this point we are trying to get out of a bad situation but we don’t need to do a fire sale.”
A land swap, Vogelheim says, could be another option for the Cheney parcels—one of which is a three-acre plot with three units on it where Jones rents. The other 2.1-acre parcel is vacant.
Commissioner Mark Newcomb remembers the battle on the West Bank while he was on the planning commission. “There was a major battle there. We ended up walking it back from NC-transitional to NC-stable [zoning],” he said. “I can only guess Christine Walker thought density should be there and was going to be allowed to be there. But at this point we need to look at our options going forward. We can’t go back in time. There is no ‘woulda, shoulda.’”
Newcomb believes a better use of Cheney Lane is selling it. It is currently listed with Brett McPeak for what the County paid for it a decade ago—$2.1 million. Newcomb believes it will likely fetch $2 million. “Are we getting the best return on our investment with three units on two parcels?” Newcomb questioned.
Perhaps only the government could lose money on a real estate deal in Jackson Hole. But it’s not all their fault. Lisa daCosta, who is running for Teton County commissioner, has a background in financing. In addition to serving on the planning commission, she has served as the business advisor for the Wyoming Small Business Development Center, handling multi-million dollar budgets in the process. daCosta does this in the real world where one mistake gets you fired; two and you’re sued.
“I think the understanding at Cheney was it would be upzoned to density. In 2002, there was blue sky upzone potential that affected the value and now you are selling ‘as is, where is,’” she said. She added that she was in favor of selling both the Cheney property and the Broadway offices of the Housing Authority.
Natalia Duncan Macker also supports parting with Cheney. The commissioner up for reelection lamented the sale price but is eager to see something positive rise from the ashes.
“That asset could be leveraged to produce more than it is. The most it could have on it is four units,” Macker said. “As to the question of selling it as a loss, we don’t control the real estate market. That’s not how the world works. We are where we are, and finger pointing about who did what and where is not useful. I believe in the creative powers in our community. We can rise up and we can go forward.”
As for the Rains property, it would be a hard sell and harder to develop.
Newcomb says the Rains property on 390 next to the Aspens is a tougher argument to make. “I could see a real battle against density there and the potential collateral damage it could cause. Aspens Market, for one, is just waiting in the wings,” he said, referring to any precedent-setting Pandora’s box that could be opened by density upzoning.
“If that gets upzoned to dense housing, how could the county say no to Bar J?” daCosta added.
At times, county leaders have seemed paralyzed to move on housing.
“We’re in a tight place. We have to make hard decisions,” Newcomb admitted. “When are we going to see the right project in the right place?”
Shoveling it on
While county officials contemplated cutting bait on a few properties that weren’t doing much to solve the valley’s affordable housing woes, a godsend arrived in the form of the Community Housing Trust. Already partnered with the Town on a project at Redmond and Hall that would build 28 affordable rentals, Anne Cresswell offered to come to the rescue of a community deep in the throws of agony over housing the homeless.
Cresswell hailed her project as perfect for a public-private partnership. The land at Redmond and Hall (bought by the town in 2013 for $1.65M) her organization was leasing there from the Town could be combined with adjacent parcels the Trust had later purchased in order to provide a significant “shovel-ready” project. The only problem was Cresswell was short a few shovels.
The development has a $12.5M price tag. After Cresswell secured commitments from private philanthropists, she tried to squeeze $2.1M from the town. She then put the pinch on county electeds. They said they’d like to help but they were broke.
“When the Trust came to us, we didn’t have the money. We had that tied up in The Grove,” Rhea said.
Vogelheim agreed. “The County has already allocated our money. They originally offered us a deed-restricted unit for consideration. Now they need two million more and we don’t have consideration for it. We can’t just give you two million without consideration. This is starting to look like deja vous at The Grove. We are spending $2.8 million on affordable housing this fiscal year—just on salary and overhead—and we still have to finish The Grove.”
When the County pulled lint out of its pockets, Cresswell suggested they sell off some of their stagnant land holdings and give her the cash, up front. Town officials balked at the idea but the BCC was 3-2 in favor (Macker, Newcomb, Rhea) of at least committing a million bucks toward the Trust’s project from the hopeful sale of the Authority’s office space on Broadway.
“They did agree to provide proceeds of Broadway to the Trust but did not guarantee it. It’s a generous offer but it does not help this project right now,” Cresswell said. “If Broadway even sells, and that’s a big if. The prospects are probably much better at Cheney Lane.”
The bind the County is in with the Broadway sale is they don’t own the land, only the building. And that’s leased from Bill and Gwen Hansen for a mind-boggling $12,000 a month,” daCosta said. “I think the county commissioners were right to tell the Trust no money now for a transaction that hasn’t happened yet. That’s not prudent. I wouldn’t want to get sideways on a commitment like that.”
Bait and switch
While government moved at a hem-hawing pace, Cresswell muddied the waters with a surprising announcement weeks ago: the project would have to change in scope from rentals to an ownership model in order for the Trust to close a $4 million gap and make their development pencil.
The changeup didn’t sit well with some. For Newcomb, it was a deal-breaker.
“I initially had good feelings about the Trust project, but I was very surprised when I heard it was being converted from rental to ownership. The community’s greatest need is rentals,” Newcomb said. “I’m not sure how closely Anne follows direction from her board. They were begging us to spend money now but they haven’t given us a clear picture of the finances. Now it looks like they can’t start this summer. If the Trust had a bona fide project ready to go this summer it would have made sense to deploy $2 million toward it, in my mind.”
Macker was also hot on the idea of getting housing on the ground by next summer. Now, she’s thinking that might happen quicker with the new Joint Housing Authority director, April Norton.
“I’m in favor of selling [Cheney and Broadway] and pledging those proceeds toward Redmond and Hall. That wasn’t necessarily enough for [the Trust]. Well, I can’t print money,” Macker said. “Now that we have April we are marching forward on establishing parameters of what a partnering of government and the private sector might look like.”
Moyer was most critical of the Trust and elected leaders involvement with a private nonprofit. “If they had their new joint housing program up and running it should be them developing Cheney or getting the money from it. The Trust is jerking them around,” Moyer alleged. “Besides, state statute says you cannot give public money to private entities.”
Newcomb agrees his board needs to be careful about partnering with private developers, even ones like the Trust with a proven track record of putting housing on the ground. “The Trust being a private nonprofit, you have to be more specific about where money is going. Clarity has to be worked out,” he said. “But we need to explore these public-private partnerships, or else the only way for private developers like S.R. Mills to make their money is to go balls to the wall with density.”
Cresswell says struggles with raising capital forced her hand. “We looked at building in phases. Unfortunately that would add millions to the cost,” she said. “Significantly more money is required to get affordable rental housing on the ground. It’s just a riskier investment. We can borrow more than twice as much for ownership units as rentals. This has not swayed our belief in rental housing, it just means it is taking longer to raise the funds needed to get rental homes on the ground.”
As County endeavors to put housing on the ground have been met with opposition and disappointment, casualties like Jones are examples of unintended consequences. Jones says she has had little to no communication with her landlords about her future housing situation.
Although it was before her time, Norton explained that the Joneses were notified the land could be sold when they signed their lease. Norton says she is doing everything she can to explore solutions for the Joneses and their neighbors. But while the Joneses will be able to live out the one-year lease they signed in the spring, they are not confident it will be enough lead time to find a new home as the valley’s housing emergency deepens.
“No matter who I ask, it’s been ‘I don’t know.’ There were no calls, emails, or a sign on the door. The only way I found out that I might be getting evicted was through the newspapers and showing up at a meeting,” Jones said.
The joint June 6 meeting Jones is referring to is when town and county officials voted to sell Cheney Lane assets. Housing Department officials also learned the news at the meeting.
“I did meet with Natalia [Duncan Macker] and April [Norton] recently. They were very apologetic. They are very nice women and I know they have their work cut out for them. It’s an enormous task. They both sympathized and Natalia said she would help us find another place. Look, I don’t care how your heart breaks, please just don’t forget us.”
And the Trust’s Redmond-Hall project? It’s sunk for now. At a town meeting Monday, councilors voted 4-1 (only Jim Stanford in opposition) to withhold the requested $2.1 million Cresswell needs to get started. An oversight committee recommended the project go back out to bid in January and then government leaders will look at it again next spring.
“I don’t think there will be any dirt flying this summer,” a disappointed Cresswell said. PJH