Mayor Bradshaw heads to Boise to discuss Ketchum’s development Catch-22 with the state
By Eric Valentine
The Catch-22 of making it affordable to live and work in a resort town reared its head this week for the City of Ketchum and the developer of a 57-unit affordable housing project slated for what is currently City Hall.
The Idaho Housing and Finance Association (IHFA) on Monday announced its 2020 tax credit recipients and the so-called Bluebird Village housing project got close, but was ultimately not one of them when it lost an evaluation tiebreaker. The reason? Construction costs per unit drove it out of the price range for funding availability.
The decision triggered a press release by the city and a trip to Boise by Ketchum Mayor Neil Bradshaw looking to meet with officials from the state who determine which projects get tax credits and which ones don’t.
Cost of construction is high in Ketchum in part because it’s expensive to live in a mountain resort area. Hence, an irony worthy of a Joseph Heller novel.
“High cost of construction in Ketchum is the reason that we weren’t funded. This is also why the tax credit award is so necessary for us to build affordable housing,” said KCDC Executive Director Charles Friedman.
The credits would have given a 9-percent tax break to investors in the project. Last year, Ketchum also was unable to achieve a top score because of its geographic location. While experiencing the most acute shortage of long-term rental housing in the State of Idaho, Ketchum has only received one award of 9% Tax Credits in the 30-year history of the program. Project cost now seems to be the only differentiating factor in the allocation plan.
“Although there was tremendous local political and financial support, the allocation system does not differentiate this factor fairly among the applicants to benefit Ketchum. Project sponsor, Ketchum Community Development Corporation (KCDC), is disappointed with the allocations,” the City of Ketchum said in a press release.
GMD Development has made four attempts in eight years to bring tax credit funding to Ketchum.
“Ketchum does not have fair access to federal housing funding under the current IHFA plan,” said GMD owner Gregory Dunfield. “This is something that needs to change. We will continue to keep our sleeves rolled up and work with IHFA to seek a better way.”
Other funding options for the project are available. Unfortunately, they will cost the City of Ketchum disproportionately more than other local communities in bringing affordable housing to their towns.
Mayor Neil Bradshaw said he is not discouraged.
“Every application creates a new opportunity to learn for the future,” Bradshaw said. “I am encouraged by the score we received, and I look forward to finding a way to make Bluebird Village fly.”
Bradshaw said there should be no construction delay since Bluebird wasn’t slated to break ground until 2021 and that he was optimistic another funding mechanism could be found in 2020.