Gardiner's housing crunch
More businesses providing housing for their employees
Editor’s Note: This is the second installment of a two-part series on the dwindling pool of affordable year-round rental units in Gardiner. Friday’s story focused on the problem and some of the consequences for individuals. Today’s story features some solutions, all provided by the private sector.
Gardiner’s rental market, always tight, is getting tighter.
“It’s not a ‘crunch,’ it’s a ‘crisis,’” Missy Miculka, a Gardiner property owner, said recently about the town’s dwindling supply of affordable rental housing.
Missy Miculka, owner of Calamity Jane Trailer Court, stands outside one of her rental units in Gardiner, Tuesday afternoon.
Property owners, responding to increased visitation to Yellowstone National Park and higher demand for short-term rentals of houses and condos, are converting homes and apartments to vacation rentals. The changeover, while profitable for owners, is squeezing hourly-wage workers out of affordable housing.
Affordable housing is an issue all across Montana, but especially in scenic areas like the Bitterroot and Madison Valleys and Gardiner, explained Penny Cope, a public relations staffer with the Montana Department of Commerce Housing Division.
An area with “incredible scenic beauty” becomes popular and out-of-state money comes in, driving up property values and driving out the locals, who can no longer afford to live there, she said.
“What if it progresses to where no one can afford to live there and work in the gas stations and coffee shops?” Cope asked.
The National Park Service has gotten involved, too. For several years, Yellowstone National Park has operated a bus that runs from Livingston to Mammoth Hot Springs four days a week. Park officials have said in the past that providing the bus is more cost effective and has a lower impact on the park environment than building more employee housing within the park.
And the private sector is stepping up to the plate. Gardiner residents have taken it upon themselves — with no government mandates or zoning regulations — to do something to alleviate the shortage of affordable rental housing.
Former Gardiner resident Carolyn Duckworth moved out of state about two years ago. When she put her house on the market, her ad said, “No speculators.” She wanted to sell her house to someone who would live in it, she said in an email. She could have gotten more money selling to a developer, but she made “enough” on the sale selling to a family.
Rhonda Creiglow is a year-round Xanterra Parks & Resorts employee. She has lived in Gardiner for 14 years, and recently bought a small house she had been renting, also owned by Duckworth. It took about a year to put the sale together, Creiglow said. She found a company that would lend her the money, but the interest rates were too high, making her monthly payment unaffordable. Creiglow wasn’t impressed and didn’t take it.
“Those payments were truly too high for me, and they were going to give me the loan,” Creiglow said, sounding disgusted.
But then interest rates dropped enough, and she found a loan she could afford.
Creiglow and Duckworth had done a lot of work to the little house, which had been built in 1903.
Duckworth gave her a good deal but made enough on the house “that she could sleep,” Creiglow said.
Building employee housing
Betty DeWeese and her husband, Dennis, own and operate the Yellowstone River Motel, a 38-room unit they run in the summer only. Her in-laws purchased it in 1970. She said sometime in the early ’70s, her inlaws were debating whether to buy a house in Bozeman or a rundown apartment building in Gardiner. DeWeese recalls some motel guests, contractors from Jackson, Wyo., who strongly suggested they invest in housing for their motel employees. Betty recalls that a housing shortage in Gardiner seemed preposterous at the time. But the family bought the apartment unit, and in recent years, they turned it into employee housing.
Now, more than 40 years later, the DeWeeses decided it was time for a major overhaul. They demolished the old complex, located on U.S.Highway 89 South across the street from the Gardiner Market, and they’re rebuilding a new six-unit compound.
Interest in renting one is already high, even though all the units are earmarked for her employees.
“People are hounding me for them,” DeWeese said.
DeWeese tells people searching for housing they should be talking to their employers. She thinks employer-provided housing is the wave of the future. Otherwise, Gardiner could find itself without a quality work force, or even any workforce, she said.
DeWeese has had to hire international students in recent years, even after the recession hit in 2008, and the students live in their housing. Many of the students are from Eastern Europe, and are desperate to make as much money as they can, doubling up in their apartments and taking second and third jobs. Students taking jobs in businesses that don’t provide housing means DeWeese is on some level subsidizing those other businesses.
DeWeese isn’t getting any deals for building housing, and she says it’s incredibly expensive. But she’s going the extra step to provide a parking space for each unit. She said parking in Gardiner is a “divisive issue.” There are no laws or zoning regulations that require a builder to provide parking spaces for a residence or business. The DeWeese’s lot is small and narrow but she dug in and insisted on making parking spaces.
“We don’t have to, but it’s the right thing to do,” she said.
Wants to build apartments
Another family-owned business is the Calamity Jane Trailer Court, located off U.S. 89 behind the Corral Drive Inn. Missy and Sean Miculka bought it from her grandparents a couple of years ago.
The trailer court has 11 spaces, Missy explained in a recent phone interview. She has a couple of mobile homes she rents out to year-round tenants. She said another business, the Super 8 Motel, rents a mobile home for their employees. They rent it year-round, whether they have an employee living there or not. And their own house is on the property as well.
Miculka also has several tenants living in their own RVs year-round. Some are on fixed incomes, she said. She has a couple of remaining RV spaces that most often end up being rented out for the summer to a seasonal worker. Then, if she happens to have any spaces remaining, she will rent those to overnight visitors.
Miculka said she would like to build an apartment on her property. She has room to build a six-to-eight unit apartment, but the numbers don’t work. Her bank told her that the cash flow from the rent she wants to charge, ranging from $400 to $600 per month, wouldn’t be enough to pay back the loan she would need to build.
Tax credits,
federal programs
federal programs
But there are tax credits and other federal programs for builders like the Miculkas who want to build affordable housing, Cope, the Housing Department spokeswoman said, but navigating the federal application process is complicated.
Gardiner had an affordable housing apartment complex, called Parkview Apartments, from the 1980s up until 2010. If the complex was officially a federal Housing and Urban Development project, Cope could not find a record of it last week, she said.
Typically, affordable housing developments are built with a contract that they remain affordable for a set period of time. The time frame can vary, she said. When it ages out, the owner is free to sell it on the open market.
Cope said the owners typically sell because they’re ready to retire, or an aging compound needs major repairs and revamping — and there may not be much cash flow from affordable housing. Collecting rent from low-income tenants, as well as maintaining the property, can sometimes be a challenge. Add in the rising property values of a highly scenic area, and there’s often a strong temptation to sell, she said.
Affordable housing unit
And that’s what happened with the Parkview Apartments. It was purchased in 2010 by a local businessman, Michael McNeil, who converted it into a vacation rental, Yellowstone Gateway Inn.
McNeil said when he bought the unit, it had not been official low-income housing since 2005. It had not always been fully occupied, and it needed a lot of work. He remodeled, creating a compound of well-maintained units all with kitchens — vacation rentals.
“I was the bad guy,” McNeil said, sardonically.
But McNeil, who looks at the big picture and likes to talk about economic theories, said a number of forces are at work in Gardiner’s economy. The demand for rental housing is always going to be much higher in the summer than in winter, which can leave owners with empty units in the winter months. There’s also very low demand for high-end, year-round rentals — there aren’t enough people with good-paying jobs to create enough demand for them, McNeil said.
“The economic engine that would drive apartment-building isn’t in this area,” he said.
He believes the solution is for employers to provide housing for their employees.
He said there is an interplay between “systems” and “people.” When the system isn’t working, people look around for other people to blame, he said.
But he doesn’t think it’s an issue of anyone trying “to do anything to anyone else.”
“Everyone is just trying to do a good job,” he said.
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Links:
[1] http://www.livingstonenterprise.com/category/byline/liz-kearney-enterprise-staff-writer-4
[2] http://www.livingstonenterprise.com/category/news-section/news/local
[3] mailto:communitynews@livent.net
[1] http://www.livingstonenterprise.com/category/byline/liz-kearney-enterprise-staff-writer-4
[2] http://www.livingstonenterprise.com/category/news-section/news/local
[3] mailto:communitynews@livent.net
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