In late July, the wildflowers are at their peak in Crested Butte, Colorado. Snow lingers on the north-facing shadows of the Elk Range while green aspens blanket the valley. It doesn’t get much better than summer in the alpine, and tourists and second-home owners know it. 

Downtown, streets are lined with colorful buildings housing restaurants, museums, and shops characteristic of an old coal-mining town. Since Crested Butte is a popular ski destination in the winter months, outdoor gear lines store windows. Blank stretches of green run down the mountainsides revealing slopes and motionless ski lifts. Tourists weave in and out of storefronts to grab souvenirs and gear up for outdoor adventures. 

But these idyllic appearances don’t tell the whole story. While its lively, bustling sidewalks portray a happy-go-lucky, laid-back mountain town, the residents of Crested Butte have been struggling to keep up with increasing visitor numbers. The last week of July, Butte Bagels, a breakfast joint in town, propped up a handwritten sign for tourists to read: 

“​​We write to inform you that our community is collapsing and our hearts are breaking. Every restaurant and retail business in this valley is experiencing an employee shortage due to the housing crisis,” the sobering sign read — a stark contrast to the restaurant’s cheery red and purple walls. 

“At least one of the people you interact with in this restaurant will leave here and not have a house to sleep in tonight — not because they can’t afford it, but because there are no houses left to rent,” Butte Bagels’ sign continued. “We are all reaching a breaking point and need your help, PLEASE.” 

Across the West, gateway communities to America’s most beautiful places are suffering from an extreme affordable housing crisis. Developers have prioritized luxury townhomes for second-home owners — who often only utilize those homes for a small fraction of the year — over high-density housing for locals, rendering it nearly impossible for local businesses to hold onto long-term employees. Resort towns’ increasing popularity and limited housing mean skyrocketing real estate prices, and an increase in short-term rentals has led to less room for residents and increasing rent. The pandemic only made matters worse as out-of-towners flooded these small towns to work remotely. Elected officials, business leaders, and regional experts have weighed in on potential solutions, but no clear solutions have emerged.

Jackson Hole, Wyoming, another small mountain community and a luxury ski town, is also suffering from the affordable housing crisis. A starting point for visitors to Grand Teton and Yellowstone National Parks, the town is also home to some of the most challenging ski slopes in the West at Jackson Hole Mountain Resort. 

Anna Olson, president and CEO of the Jackson Hole Chamber of Commerce, shed light on the problem of staff shortages for local businesses — particularly small businesses. “It’s never been cheap to live here, but right now it’s about the lack of inventory,” she told The Politic

Olson said that in Jackson, the pandemic contributed to a “lost inventory of workers” since many started working remotely. In the past year and a half, there was also faster and more prevalent turnover for homes in Jackson’s typical rental pool, particularly condominiums, purchased by new families or remote workers. 

With the Teton County Housing Department, the Jackson Hole Chamber of Commerce conducted a survey of chamber members about their challenges in hiring employees in May 2021. Half of the 250 businesses that responded said they are considering adjusting their operations due to the town’s staffing shortage, in part caused by a lack of affordable housing. 

Businesses said that there is at most one candidate for every three open positions. Almost all surveyed businesses — 94.5% — said that housing is “at the core of their staffing struggles.” 44% help their employees with housing through subsidization, housing stipends, or on-site housing, and 55% reported losing one to five employees due to housing problems in the previous six months.

Jackson Hole Mountain Resort, the national parks, and hotels in the town have been providing housing for their employees for decades. But with the affordable housing shortage, small businesses are having to help house their employees, which imposes an additional set of logistical and financial burdens on small businesses that don’t have more than five employees, let alone human resource departments.

On July 7 of this year, Crested Butte’s town council declared an affordable housing emergency. Town officials said that the town’s shortage of housing, specifically affordable housing, was creating a significant burden on Crested Butte’s businesses, communities, and values. 

“Since I’ve been mayor, I’ve always tried to make this the best possible town to live in,” Crested Butte Mayor Jim Schmidt told The Politic. In the summer of 1976, Schmidt grew tired of the banking industry “rat race” and headed west on his motorcycle. He stumbled upon the mountain town and hasn’t left since.

The town now known as the “Gateway to the Elk Mountains” rests on ancestral Ute land. Placer miners arrived in the area in the 1860s, and Crested Butte itself was established in 1878 for its coal mining potential. The 19th century brought a railroad, hotels, saloons, and a telephone line to Crested Butte, as well as white coal miners. Crested Butte was a mining town until 1952, when the Big Mine closed, leading to a decline in population and jobs. But the remaining residents hung on and saw the opening of a ski area on Crested Butte Mountain featuring the state’s first gondola. Today, the town is known widely for its year-round natural beauty and outdoor recreation opportunities.

After 31 years serving in Crested Butte’s local government, Schmidt has seen the town grow from a quiet skier’s paradise to a swamped tourist destination. When he arrived, “the skier-types and young hippies” had little problem finding housing. But since Crested Butte got on the map as a year-round road trip destination, “things have been getting tighter and tighter,” Schmidt said, resigned. 

In an attempt to assuage the problem, the town implemented a band-aid solution this July: allowing workers to tent camp or park their mobile homes on residentially zoned private property until October 15. But the measure was ineffective: “There was only like, one taker,” Schmidt said. Workers living in tents or RVs would rather stay in nearby national forests, a more scenic option than someone’s backyard.

The lack of housing in Crested Butte is multifaceted. First, 78%of Gunnison County is federal land belonging to national forests and the Bureau of Land Management, so it’s off-limits to development. 

That leaves relatively little private land, where developers don’t have a financial incentive to build low-end, high-density affordable housing. “[Developers] can make a lot more money selling empty lots,” which Schmidt reported are going for millions.

But second-home owners only reside in Crested Butte for a few months. The town’s most envied real estate, rustic-looking mansions on mountainsides, sit empty for the rest of the year. 

“In our tiny newspaper, you’ll see three pages of ads for ‘Help Wanted’ and then a column that lists three or four units for rent,” Schmidt said. Listings include houses for $3,500 a month and one-bedroom apartments for $1,500 a month. “There’s just not much out there,” he continued. 

Next, the advent of Airbnb and VRBO in the last decade revolutionized the short-term rental market. Suddenly, local realtors were rendered obsolete by the internet, and residents rented rooms to tourists for higher prices rather than renting to local workers. The lack of space and rising prices mean that even trailer homes are becoming unattainable.

“I understand that it just made it much more financially attractive for somebody to do short-term rentals,” Schmidt said. “You can’t buy a house for a million dollars and then rent it out to somebody at a reasonable rate.” 

As a result, few if any local police officers and snowplow drivers — who make modest salaries — can afford to live in the town of Crested Butte. Many live in nearby Gunnison, which is more affordable. “That’s pretty tough for a quick call,” said Schmidt. But even in Gunnison, he continued, the local college and hospital have had trouble holding onto professors and doctors, who turned down jobs because they couldn’t find suitable housing, even with their relatively sizable salaries. 

The property values in the town are so high that some residents plan to use their real estate as their retirement funds, Schmidt said. People who moved to Crested Butte decades ago and purchased more modestly-priced property are now sitting on houses worth millions. If or when they sell, they could buy homes “twice as big” in other, cheaper Colorado cities like Grand Junction or Montrose, and put the difference into their bank accounts.

The coronavirus pandemic further exacerbated and exposed the severity of the West’s housing crisis. Visitors seeking wide-open spaces to stave off cabin fever chose places like Crested Butte and Jackson Hole where they stayed in Airbnbs and VRBOs, environments more easily controlled for health concerns, rather than local hotels. 

“It’s just amazing how this last year with COVID slammed down the amount of affordable stuff – or any stuff — that’s out there,” said Schmidt. 

When the pandemic hit, city dwellers sought to escape crowded metropolitan areas in favor of places where they could easily do remote work, complete with incomparable landscapes and accessible amenities. Both Crested Butte and Jackson Hole fit these criteria. These white-collar workers make enough money to afford housing in these spaces; some had wanted to make the move for years while others, after settling in, decided to stay. 

Either way, these former city dwellers have contributed to rising real estate prices and limited housing. During the height of the pandemic, more people wanted to move to these places, making the properties more valuable (and expensive), which priced out local workers.

Currently, 60% of Jackson Hole’s employees live in the town, according to Olson, and the goal is to increase that fraction to 65%. Many Jackson workers have made the move to Victor, Idaho, just over the state line. Commuter opportunities there are endless, according to Olson. “There’s vast amounts of land there,” said Olson. “Nobody lived over the hill in Victor when I moved here, and now lots of people live there. It’s becoming much more of a robust community.”

To support a greater number of commuters, Jackson’s local government may have to invest in public transportation from these peripheral towns to Jackson, or local businesses may have to allow employees to work from home or have more flexible schedules. “We’ll just have to make different choices,” said Olson.

One option for local employees is to live further away from Jackson, where housing prices are cheaper. But Jonathan Thompson, a lifelong resident of the West and contributor to the American West-focused publication High Country News, has dubbed this phenomenon “the old ‘drive till you qualify’ non-policy of affordable housing.” This “non-policy” comes at the cost of time and gas expenses to local workers. 

Thompson has spent the majority of his life reporting on the unique issues facing his home region, and he argues that “driving until you qualify” can only last so long. 

Take Aspen, Colorado, for example, where people drive up to 90 miles to “qualify” for housing near the high-end ski resort town that they can afford. Towns were created because workers couldn’t afford to live in the affluent ski town, such as Basalt, which is now also too expensive for most workers. “Now, that’s where the attorneys and doctors live,” Thompson said. “They still need to find affordable housing, too.” Further west, others are driven to Silt and Grand Junction near the Colorado-Utah state line. 

“There’s this interesting dynamic where those [towns] end up creating their own communities and eventually their own economies, so those employees don’t need to drive to Aspen anymore,” Thompson explained. “They might get paid a little bit less, but they can work in a restaurant or a hotel, or they can work for the wealthy people who then end up in those towns — so then you’ve taken away from Aspen’s labor market.”

But while others might wring their hands at the lack of affordable housing and predict a doomsday wherein all businesses within a resort town will have to shut down, Olson offers a more optimistic view. “It’s just adaptation,” she said. “We’ll just have to make different choices… but you don’t just walk away from it.”

***

So, what can be done about the West’s affordable housing crisis?

This November, Crested Butte’s ballot features three different potential taxes that could help mediate the issue. The first is to raise the town’s sales tax by half a cent to go towards affordable housing development projects. The second is to raise the current 5%excise tax on all vacation rentals and short-term rentals, which went into effect in 2017 and contributes to the towns’ affordable housing fund, to 7.5%, in an attempt to limit the number of short-term rentals in town and increase revenue for affordable housing projects.

The third, and most controversial, is to levy a second-home tax on homes not occupied by year-round residents. Schmidt explained this “empty home tax” would be a flat fee of $2,500 on those who don’t live in their Crested Butte homes for at least six months out of the year. 

“I think it’s totally unfair because it’s not based on the value of the property,” Schmidt said, arguing that some longtime Crested Butte homeowners could be affected. But Crested Butte Finance Director Rob Zillioux told Crested Butte News that the policy could “thwart” the town’s trend of becoming like “other resort communities in the West like Moab, Aspen and Jackson, that went from nice communities to ‘amusement parks for the wealthy.’”

“If we build [more], we’ll just need more. If we build [more] and the service is real good at the restaurants, we’ll need more restaurants, then more people will come here, and then we’ll need more housing,” said Schmidt. “It’s a kind of unending spiral.”

Down the Interstate 70 corridor in Colorado, Vail, another luxury ski town, launched a new deed restriction program called Vail InDEED in 2017. The town will purchase deed restrictions from homeowners and developers, which will limit the occupancy of a given unit to workers in Eagle County, where Vail is located. Deed-restricted properties are exempt from real estate transfer taxes and the restriction won’t change when properties change hands. The town’s goal is to acquire an additional 1,000 deed-restricted units by 2027. 

In 2020, the Urban Land Institute recognized the program as the Robert C. Larson Housing Policy Leadership Award winner. As of September 2020, Vail InDEED has allowed the town of Vail to purchase 153 deed restrictions for a total of $10.5 million, which allowed 340 year-round and seasonal workers to attain housing. 

“This is often framed as a simple supply-and-demand problem, but it’s not,” Thompson said. There isn’t a fixed number of people in each community who need to buy homes, but rather a network of potential buyers from across the country vying for limited real estate in beautiful places. 

Thompson thinks that either the government should supply this housing by enabling local housing districts to build high-density affordable housing or by forcing developers to do it. If a developer wants to build a subdivision of 100 houses, for example, the local government could require 20 of them to be affordable units. 

Schmidt agrees: “Affordable housing is going to have to be something that people pay for, just like you pay for roads and schools and water and sewer. It’s a function of the town because the growing separation of income categories has gotten so large.”

The best solution, according to Thompson, is a real estate transfer tax — a tax on the transfer of a property’s title or deed. 

Wyoming’s House Revenue Committee attempted to pass a real estate transfer tax in May of this year, proposed by a Teton County Democrat. The tax would have allowed counties in the state to institute a 1%tax on real estate sales over $1 million. Teton County officials said the tax revenue could go towards assuaging Jackson’s housing crisis, but the measure failed

These are great places to live, Olson, Schmidt, and Thompson agree. There aren’t many towns where one can access world-class recreational activities and views that others travel thousands of miles to see. But according to Olson, “there is a responsibility to living in a place like this, and that responsibility includes being a good steward of the surrounding environment.”

Schmidt said that global warming has contributed to the increase in visitation to resort communities, particularly those located in the mountains. “When I first moved here, there were two seasons: winter and the Fourth of July,” Schmidt quipped. Then, there were only about 45 frost-free days per year. Now there are up to 90 frost-free days, with May and September experiencing less snow than in previous decades. 

A quarter-century ago, according to Schmidt, the town’s seasonal economy was almost entirely focused on the wintertime. But the flip towards summer, which has been mirrored in other Colorado towns like Aspen and Telluride, means that summer business makes up 65% of the town’s budget. The town is busier in times it hasn’t traditionally been, straining businesses and infrastructure. Schmidt reported that Crested Butte’s busiest months are July and August rather than December and March, which now see the same numbers as June and September.

“The big question has been, who are we saving this town for anyhow? And unfortunately, it seems like we’re saving the town for people with a lot of money to come in here and buy it and get people pushed out,” Schmidt said. 

But local communities aren’t giving up. Part of the “responsibility” Olson mentioned is buying into the characters of these places from a place of care and intention. That includes tipping service workers, caring for the land, and getting involved in the local policy-making process to make things better for everyone. 

It also means that wealthier residents will likely have to pony up to keep the town running. But while taxing real estate or second-home owners may bring in revenue, the onus will be on local governments to take concrete action and put that revenue to good use. 

Living in a new and beautiful area, Olson said, “can look very glamorous and shiny.”

“But these are very, very special places,” she continued. “And we need to work extra hard to make sure that we retain their beauty and do everything we can to balance the importance of community in them.”

Leave a comment

Your email address will not be published. Required fields are marked *