By Lyndsie Kiebert-Carey
This article is the third piece in an ongoing series during which the Reader will examine various aspects of the labor shortage affecting area employers.
By now the connection between affordable housing and the shortage of workers in cities throughout the country — and particularly the West — has been made clear. Policymakers, analysts and economists, realtors and developers, business owners, workers and everyone in between can point to all manner of statistics and anecdotes to illustrate the simple fact: workers can’t work if they can’t afford to live where they work.
There are other factors in the mix, of course, but a lack of so-called “workforce housing” has been underscored again and again as a particularly onerous obstacle for employers to overcome in finding and retaining people to fill vacant jobs in industries ranging from manufacturing to health care to education and the broad swathe of services that encompass leisure, food service and hospitality.
In an ongoing series of articles about the worker shortage, with installments published Sept. 16 and Sept. 23 and available at sandpointreader.com, the Reader has spoken with a range of stakeholders and experts and dug into regional data to explore some of the trends at work fueling the lack of workers that employers across the economic spectrum have felt in their day-to-day operations.
In the first part, Idaho Department of Labor figures showed that unemployment in the North Idaho region is 3.8%, which, while the highest in the state, is still significantly below the 5.2% national jobless rate. Meanwhile, in Bonner County that number is 4.2%. Reasons for that are varied, but circle around affordability.
As the population has boomed amid the COVID-19 pandemic, with many thousands of newcomers flocking to Bonner County in search of rural quality of life — and its lower cost of living relative to urban centers — they have imported salaries far higher than North Idaho’s historically low pay. Compound that influx of people and capital with the fact that many of them are working remotely for businesses located elsewhere, and it has caused a sudden, severe downward crunch on lower-wage workers.
Put simply, even a manufacturing worker making something in the vicinity of the area median income of $60,000 or so can’t compete with the buying power of a transplanted worker earning twice or more when purchasing a home. For a leisure and hospitality industry worker (the fourth largest employment sector in the county behind manufacturing, making an average wage of about $20,000), even rental housing, which frequently rises into the $2,000-per-month range, even for single-bedroom or studio units, is out of reach.
At the same time, the region has been flooded with retirees — either from out of the area or locally and opting for early retirement as the COVID-19 pandemic continues — who also bring with them large amounts of capital with which to invest in housing at prices far above the means of local workers.
As a result of all these factors, Bonner County’s labor force actually shrank from July 2020 to July 2021, according to the Labor Department — what one economic development expert described as “the perfect storm of COVID, housing prices and people moving out to seek lower cost of living and higher wages.”
In the second part, the Reader talked with others who are addressing the housing affordability crisis, sketching in broad strokes just how dire the situation is for local workers. One solution has been for local business owners to take matters into their own hands and supply housing to the workers by buying properties and making them available as rentals. Another, expressed by county officials, is to ease the way for development to occur, thus expanding the inventory and lowering prices.
One housing expert proposes another path, which puts the onus for solving the affordability crisis on owners and sellers, rather than government or employers.
Where income meets outcomes
Rob Hart has been busy.
The executive director of the Bonner Community Housing Agency has experienced no shortage of media attention in recent months, as the agency’s efforts to tackle North Idaho’s housing affordability crisis have garnered coverage in both local and regional publications. According to Hart, collaborations with local landowners, developers and employers are starting to bear fruit — that fruit being housing for local wage earners, who have steadily been priced out of Sandpoint in recent years.
“We’re kind of catching our breath now,” Hart told the Reader.
Hart and BCHA grabbed the spotlight earlier this summer, when plans went public for a 49-unit development in Sandpoint built exclusively to house people making 80-120% of the area’s median income. That development, named Culver’s Crossing and owned by Sandpoint native Nancy Hadley, would be the first to participate in BCHA’s Income-Based Local Housing Program. According to Hart, similar projects are also in the works, meant to put roofs over the heads of North Idaho’s near-average earners.
“We’re not talking about low-income housing here,” he said. “This is middle of the market.”
BCHA, which covers Bonner and Boundary counties, is a state- and federally-funded housing entity under the Idaho Housing and Finance Association. While the various agencies across the state are traditionally charged with building individual subsidized homes for low-income families, Hart said BCHA is “branching out” with its Income-Based Local Housing Program, attempting a broader approach to North Idaho’s housing woes. While BCHA has only enough funding to cover basic operating costs, the nonprofit is able to charge a fee when enrolling a landowner or developer in its programs.
Also in the works are partnerships with some of North Idaho’s “larger employers,” Hart said, who want to build employee housing. In a July workforce housing survey conducted by the city of Sandpoint, employers repeatedly shared a desire to take housing into their own hands. However, employers often have difficulty footing today’s hefty home prices.
“I tried to buy a house to use as a rental,” one employer shared in their survey responses. “The prices were outrageously high and I couldn’t make it work.”
“I looked into purchasing a multi-room house four years ago when I started noticing an issue for employees to find housing but wasn’t in a financial position to make a purchase at the time,” another wrote. “I have attempted to rent apartments through my restaurant specifically to house employees but as of yet have been unsuccessful.”
That’s where BCHA comes in. Hart said the agency is currently looking for land — an acre or more — to bring these employers’ visions to life. Landowners who “would like to be a part of the solution, and make money doing it” are invited to reach out.
Hart said he’s not yet ready to name the employers looking to take this approach, but that throughout the community, “there is great interest.”
“It is potentially big news,” he said.
‘Three easy steps’
While landowners, contractors and other players in the housing game are invited to participate in the Income-Based Local Housing Program, Hart said the solution to Sandpoint’s affordability crisis doesn’t depend exclusively on enrolling in the initiative. The solution, he shared with the Reader, is actually “three easy steps,” as follows in Hart’s own words:
Step No. 1: Landowners, please do not sell land to speculators and investors. Please try to sell land to developers and builders who agree to follow step No. 2 or to local employees, seniors and the disabled.
Step No. 2: Developers and builders, please try not to sell homes to investors and speculators. Please try to sell homes to local employees, seniors and the disabled who do not have an annual income greater than half of the home price.
Step No. 3: Real estate agents and sellers, please try not to sell homes to investors and speculators. Please try to sell homes to local employees, seniors and the disabled who do not have an annual income greater than half of the home price.
“This is not discrimination. The super wealthy are not a protected class. I am not suggesting that people change their prices, just that they try occasionally — just occasionally — not to sell to investors and speculators,” Hart said, noting that “investors and speculators” include anyone purchasing housing for profit, not as a residence.
“If even 10% of sales in Sandpoint in the next 12 months follow this plan, we can go a long way toward solving the housing crisis,” he added.
There’s no shortage of local people looking to buy homes. Whether they get the chance, though, is another story.
“There are hundreds of people right now in Sandpoint who are pre-qualified with banks to buy homes,” he said, noting that he knows of one bank with more than 100 qualified applicants waiting to purchase housing.
“These people are pre-qualified and ready to buy. They never get a chance,” he said.
That’s because investors, Hart said, are willing to pay the exorbitant prices in cash. The solution, then, is for those with the decision-making power to make decisions that favor those who work and live in the panhandle.
“So that’s what I’m asking for: Just consider a local, please, just one [time] out of 10,” Hart said. “That’s it. That’s the story.”
And choosing to sell to the local employee, senior or disabled buyer doesn’t have to mean giving up all hopes of a profit. BCHA provides consulting to local developers to find ways to make the best of both worlds. Housing projects already underway could possibly qualify for a BCHA program, seeing as pricing up to $555,000 per home is currently allowed.
“Local contractors can contact the agency, enroll a home or two in the program, and become a part of the solution while still making a profit,” Hart said.
The bottom line? The Bonner Community Housing Agency wants to solve the area’s affordability crisis through collaboration.
“We’re not looking for volunteers. We’re not looking for contributions. We’re not looking for gifts,” Hart said. “We’re looking for people who want to make money and help the community.”
Hart brings a wealth of experience in architecture and development to his position at BCHA, as well as a passion for helping North Idaho keep its character.
“I just hope I’m not too late,” he said.
Pick up the Oct. 7 edition of the Reader for the fourth part in this series, which will look at how some other communities in the region have addressed the twin issues of lack of workforce and affordable housing. If you have a story of how the worker shortage and/or housing affordability has affected you or your business, share it with us at [email protected]
Additional reporting by Zach Hagadone.
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