The House Revenue and Taxation Committee agreed to introduce a proposed bill that would authorize cities to require developers to pay fees in lieu of developing workforce housing.
The proposed legislation, if it passes, would allow Sun Valley to reinstate a workforce housing ordinance that was ruled unconstitutional last year, or adopt a similar ordinance. The ordinance required residential developers to build a portion of a subdivision or other development as workforce housing, or, if that was inconvenient, to pay a fee into a workforce housing fund. It was a condition of receiving a building permit.
The court determined that Sun Valley’s ordinance was unconstitutional because for ordinary citizens building a single family home, generally their only option was to pay the in-lieu fee, which made it the equivalent of a tax. The Legislature has not authorized cities to assess fees or taxes for workforce housing, the judge determined.
The legislation, sponsored by Rep. Wendy Jaquet, D-Ketchum, would give cities that authorization. The proposed legislation now becomes a bill and would go back to the Revenue and Taxation Committee for further consideration. If the committee approves it again, it would go on to the full House and then to the Senate.
But the committee voted to return three other pieces of proposed workforce housing legislation to Jaquet.
One proposal would have given cities the right to hold elections for tax levies that would help pay for workforce housing. The levies would only be assessed against homes that were not owner-occupied – second homes or vacation homes. Members of the committee were concerned it would not pass constitutional muster because it would tax some homeowners at different rates than others. They also disliked language that would have allowed the levy to pass with just a majority vote, instead of a two-thirds supermajority.
Another proposal would have expanded the definition of impact fees to allow them to be used for workforce housing. Some committee members were concerned that the list of people eligible for workforce housing was arbitrary and that the bill could benefit some employers unfairly over others.
A fourth proposal would have expanded local option tax authority that the Legislature gave counties to allow them to retire debt on jails, allowing counties to use local option sales taxes for workforce housing. Some committee members were concerned this would penalize shoppers from surrounding areas, and others were concerned with extending a tax that is supposed to sunset at the end of 2009.
3 Comments
What if the feds were to eliminate the mortgage interest deduction on second homes, and make that money avaiable to developers to build workforce housing? If you are John Kerry, or Bruce Willis, and you like the fact that there are lots of neat shops, restaurants, bars, and coffee houses, near your vacation home you should pay for that, right?
The philosophy here is no different than what we already do with impact fees - "make growth pay for itself." If you want and need the services of low-wage service workers, pay for it. This could be a solution for resort towns all over the country that have a lack of workforce housing.
Comment By Chris Blanchard Friday, February 15, 2008 @ 8:41 AM
Or instead of trying to collect additional taxes to pay for workforce housing why not allow County Assessors the ability to give tax incentives to developers that construct workforce housing. Local zoning ordinances could also be modified to provide density bonus, parking reduction, etc. to make the projects profitable.
These same arguments can be applied to providing affordable housing for lower income citizens in any location.
Comment By Patrick McKeegan Friday, February 15, 2008 @ 11:18 AM
Workforce housing provides a wage subsidy for local employers, creates a recruitment/retention tool for public and private employers alike, and ensures that key professionals (i.e., firefighters, police officers, teachers and health care workers) can live in the communities they serve.
Workforce housing is increasingly viewed as part of a community’s essential infrastructure, like telecomm, water and sewer, and other items necessary to keep a community functioning. It is just as vital an economic development tool as anything else, including corporate tax breaks.
Second home owners and speculative investors that own vacant homes rarely add substance to a community; their vacant homes increase property crime rates, inflate property taxes for long-time residents and drive the cost of housing beyond the reach of working families. Ghost neighborhoods are increasingly common, and are turning ‘resort communities’ into just plain ‘resorts.’
Rather than enabling this exodus of equity, we should ensure that they contribute to the quality of life and other amenities that attracted them to our communities in the first place.
We have seen real-estate speculators over the past decade strip mine the value of many towns and send it off to benefit individuals and corporate trust who have never set foot in our state, and who can’t tell the difference between a yellow belly pine and a pork belly stock.
Workforce housing targets Idahoans who work for a living, send their kids to local schools, volunteer for local organizations and charities, frequent local restaurants and other retailers, and in general circulate every dollar of every paycheck in their local economy 365 days a year. They’re also the ones who stick around to vote when the second home owners have flown home for the high season.
It is ironic that in Idaho, a state that prides itself on local control, that the Idaho Legislature would keep Idaho communities from determining their own priorities and future.
Unless the State of Idaho is willing to support workforce housing in other substantive ways, it should at least grant communities the range of tools necessary to cultivate their own vitality and self-reliance, and to establish rules of etiquette for developers and those for whom Idaho represents a playground instead of their home. We can't look to the feds for help, so it's time to get creative and find local solutions.
I'll keep my fingers crossed, 'cause that always works.
Comment By Erik Kingston, PCED Friday, February 15, 2008 @ 12:35 PM
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