THE BUZZ 3: Livin’ on a Prayer

By on March 21, 2017

Some electeds say proposed amendment tied to new apartment project would help developers but could hurt people who need housing most.

An artist rendering of the 90-unit proposed apartment complex for 550 W. Broadway.

JACKSON HOLE, WY – Town chambers filled to the brim Monday night with people in support of restaurateur Joe Rice’s proposed 90-unit apartment complex on 550 W. Broadway. But for town council to approve the Sagebrush LLC project it would first have to relax development requirements pertaining to affordable housing, both for Rice’s complex and all future projects like it.

The project, many argue, is an immediate and substantial remedy to the community’s lack of workforce housing. But Rice’s project, specifically, was not the item in question, said Councilman Jim Stanford and Mayor Pete Muldoon. Instead, councilors were asked to vote on a text amendment to Land Development Regulations (LDRs) that would exempt all new apartment complexes like Rice’s from Affordable Housing Standards.

As it is now, LDRs mandate that at least 25 percent of units in a new housing development be “affordable,” or priced below market value. Under the proposed amendment, all new rental apartment units would be exempt from such standards. In other words, all of the units could be rented at market value.

“[Rice’s project] is precisely the kind of project we should be looking at and exploring,” Muldoon said in a closing statement. “But we’re not here to approve this project. I absolutely trust his promises, but that’s not why we’re here.”

Christine Walker, director of Navigate JH and a housing consultant to Rice, agreed that the issue at hand was bigger than one individual project, but she says that is precisely why the council should consider the text amendment. “We were looking at the path through the entitlement process, and wanted to identify barriers in the process and to educate the town as to what those barriers were to build apartment buildings,” she said.

By presenting those barriers in a town-wide text amendment rather than asking for a single-product exemption, Walker hopes to incentivize more private-sector developers to build rental apartment complexes and make a dent in the housing process.

Multi-family rental units, or apartment complexes, Walker says, are inherently affordable. The sheer density of the buildings makes them more appealing to working-class renters. “There are a lot of other options for second-home owners, and not a lot of demand to want to rent in a very dense building,” she said. Increasing the supply of rental units available also lowers market rent across the board, she noted.

But Muldoon says that exempting apartment complexes in one sweeping, town-wide text amendment is too risky. He says the council was being “asked to trade guaranteed housing for a hope and a prayer.” The council’s goal, he said, is not just to build units, but to “build units for those who need them most.”

Even if he trusts Rice and his project, Muldoon says there is not enough empirical evidence to suggest that apartments are inherently workforce-friendly. Deed restrictions, he said, exist to protect the valley’s most vulnerable populations from losing their homes to unregulated greed. Without them, there is nothing stopping private developers from renting the units to just about anyone, like a part-time resident who owns property in other places instead of a member of the local workforce. “They could just make a decision to rent it to rich people,” Muldoon said, “and there’s no recourse. We’ll just watch it happen.”

Town and county planner Alex Norton said that the affordable housing restriction could be exchanged for an employment restriction, which would mandate that at least 35 percent of the building’s occupants work 30 hours or more a week in town.

But that exemption, Muldoon says, would not be income-based, so residents with high incomes and good credit could push out a low-income worker and essentially defeat the building’s purpose of housing Jackson’s workforce. “There are no restrictions on any of that,” Muldoon said. “The only thing that’s been proven to work here [to protect tenants] are deed restrictions.”

Walker argued that deed restrictions scare developers away from committing to projects that would ultimately provide rental units for more of the workforce. There’s a difference, she said, in multi-family ownership products, like condominiums, and multi-family rental products, like apartment complexes. There’s more money to be made in the former, she said, but that’s not what the community needs. “There’s a strong market here for for-sale products,” Walker said. Deregulating rental apartment units, she said, provides “real incentive for developers to build rental projects instead of developer projects.”

The notion that existing regulations prohibit developers from building units is simply not true, according to Stanford. He pointed to Greg Prugh’s 12-unit apartment complex that now houses hospital employees. That complex was built with a 20 percent deed restriction, he said. “The only reason we have the housing we do today,” Stanford said, “is because people have foresight.” Deed restrictions, he says, are that foresight.

Still, Rice and Walker assert that the text amendment must be part of the solution to the housing crises. Recent affordable housing efforts like Redmond/Hall are “desperately needed,” Walker said, “but they are few and they are expensive.” With this project, “you have two private citizens willing to offer, at zero cost to the community, 90 rental units that provide new, safe, and reasonable apartments for local workers.”

“Vote to make a change to regulations,” Walker said, “and get much-needed help from the private sector to get much-needed housing to employees.”

“How many people in this town have come to you and presented a 90-unit building that is 100 percent privately funded?” Rice asked the town council. “Probably zero. Because financing’s tough. The return on investment is small, and most people won’t do it. In this situation, it’s not about the money.”

But Rice’s project is still just one project in a much larger conversation. “We’re not idiots,” Muldoon said of the council. “If somebody was really trying to give us 90 units of affordable housing and all we had to do was say yes, there’s no chance we would say no. But asking to eliminate deed restrictions on all future projects? It’s a real stretch to me.”

Only four town councilors were present at the meeting—Don Frank was out of town. Councilor Hailey Morton-Levinson was the only councilor present in full support of the amendment. “Apartments are part of the solution, I want to see them built,” she said. “I agree with the text amendment. I understand that it applies town-wide, and I encourage us to pass it.”

Councilman Bob Lenz said he was interested in the project and wants to see it proposed on a PUD (Planned Unit Development) proposal, but “the text amendment is more than I can handle as far as universality.”

In the end, Walker requested a continuance for further discussion until the full council could vote. The council voted unanimously to continue the discussion at its next meeting on April 3 provided all council members are in attendance. PJH

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