The Jackson Town Council is changing course with a handful of workforce homes near downtown.
They voted Monday to let developers sell three Kelly Place condos to local businesses. Funded in part by public dollars, the units were originally supposed to go directly to workers.
But getting them off the market has been a tough sell.
“As you know, it’s been challenging as far as the cost of money,” realtor Jake Kilgrow told council members. “It’s been a big barrier for a lot of people.”
The remaining two-bedroom units have been on the market for nearly a year and are currently listed at $850,000, according to a staff report.
High construction costs during the pandemic and snags in the supply chain drove prices up. Sky-high interest rates have also made getting a mortgage loan unattainable for many interested buyers, according to Kilgrow.
He said the condos could be more affordable for businesses, which would then rent them out to local workers.
“At the end of the day, the goal is to get people into housing,” he said.
But not everyone was in support of the proposal.
Bearing the burden
In approving the change-up, the town council was going against a recommendation from the Jackson/Teton County housing director, April Norton, to stay the course and sell to local workers.
In a past interview, she told KHOL that there’s inherent risk for developers in these kinds of public-private partnerships.
“In our projects, if there’s a cost overrun, we never bear that burden,” Norton said. “So, that goes back to our private sector partners.”
In this case, the town and Teton County secured the land, and hired Jackson- and Brooklyn-based firm, Post Company, to build the development, which was originally proposed as 16 units.
That number was brought down to 12 after months of public debate. According to the staff report, this caused significant delays in construction, resulting in the units coming to the market amid rising interest rates.
So far, seven units have been purchased and two are under contract, leaving only the remaining three. The developers say the slower than anticipated sale is costing them over $20,000 a month.
But that didn’t sway council member Jessica Sell Chamber’s vote.
“I’m not going to signal to the community that a person’s profits are more important than workforce housing,” she said, voting no.
Council member Jonathan Schechter also voted against the proposal.
A split vote from council
Community members such as Perri Stern and Dave Meaney urged council members to not “bail out” the developers, but Vice Chair Arne Jorgensen didn’t see it like that.
He said there were special circumstances, citing the pandemic, supply chain issues and skyrocketing interest rates.
“I don’t think this is bailing out a partner. This is a partner that has acted in good faith with us,” Jorgensen said. “I don’t think we’re setting a precedent here.”
Businesses will still be required to rent units to households that meet the workforce program requirements. One person must work full-time locally, with 75% of household income earned locally, among other restrictions.
Appreciation for the units will also still be capped at 3% annually and will only be allowed to go to businesses for the initial sale. If they’re resold, they’ll go back into the local housing department’s weighted drawing to be sold directly to qualified workers.
Ultimately, Jorgensen, council member Jim Rooks and Mayor Hailey Morton Levinson moved the proposal forward.
According to Morton Levinson, “At the end of the day, our community members who work for local businesses will be living in these units.”
