What Can Government Do?
This month we have been looking at the issue of working and living in Aspen. Is it, as some believe, so expensive here that the next generation of Aspenites will be forced down valley by high rents, low wages and difficult housing? The income gap is significant in Aspen and so are prices. The question we ask today is what if anything can government do about it. We spoke with past and present elected officials. APR's Roger Adams reports.
“You hear from a lot of old-timers, ‘Hey, you should have been here in the 70’s."
Adam Frisch is a member of Aspen City Council.
In the 70’s and early 80’s the really really wealthy people in this country were five or ten times wealthier than a lot of other people. Now they are 80, 90 a hundred, a thousand times wealthier. We’ve always attracted the top point-one-percent of the country or the world its just that 30 years later from the 1980’s or 70’s, the point-one-percent is extremely wealthy, not just kind of wealthy.”
And this income inequality has skewed the economy of Aspen toward a higher end consumer and made it harder for some residents of modest income to afford living here. It also has been identified by young people, local business owner and commuting workers as a barrier to making Aspen home.
“30 years ago, even adjusted for inflation, it probably was much less money to come here and ski-bum your way through how ever long you wanted to do it. From a government standpoint it is without a doubt a concern of everyone’s. You know, if you don’t have the next generation of ski-bums in 20 years who’s going to come to Aspen?”
When you ask what can be done to ensure a thriving local population, the first response is often to point to Aspen and Pitkin County’s affordable housing program. It began in the mid 1970’s with the observation, not at all unlike current concerns, that Aspen was getting too expensive for the locals.
“It was really clear there was a rapid change in the affordability of housing."
One of the architects of the affordable housing program is Michael Kinsley who served on the Pitkin County Commission from 1975 to 1985.
"It was affordable when I got here and that was 1970 but, by 76 it was already getting what at the time seemed outrageous. It was clear enough that there was a rapid change taking place, that something needed to be done.”
What was done was to create a housing authority that created housing that was in essence removed from the free market of real estate. These were projects sheltered from the supply and demand pressures that were causing home prices and with them rents to spike out of reach of the waiters, teachers and ski-bums.
“The idea was to attempt to sustain the community. And, for many of us, our definition of that was that people lived near where they worked. And, that walk-ability is central to most of the current thinking about what constitutes a viable urban community.”
In that sense, the local government of 40 years ago was visionary. It sought to create a community where people lived and worked within walking distance. During this time Kinsley and his fellow county commissioners and the city government explored other interventions to make Aspen a sustainable place to live. Public transportation was begun; growth was managed. Residents and visitors today take much of this for granted but in the 1970’s it was bold.
“It was. There was a lot of opposition to what we were doing. There was a lot of opposition to just about everything we were doing at the time. It was a progressive government in a more traditional context. There wasn’t anything like unanimity about these progressive ideas about growth control and affordable housing and public transportation. Those were pretty radical points of view an there was very aggressive opposition to that.”
What Kinsley says was missed back then was how quickly and how high real estate prices would go. They couldn’t have foreseen what former Aspen Mayor Mick Ireland says was a sea change in the US tax codes in 1986, a year after Michael Kinsley had left the county commission. The changes provided tax advantages for owning real estate says Ireland and almost overnight the character of Aspen’s neighborhoods changed too.
“And there was a spike, immediately within 90 days. There were 38 sales of more than a million dollars, which was unheard of; 36 of them were cash. And this is an important phenomena because what happened, first most notably in the West End but, then spreading was that property that used to be owned with a mortgage and rented to people like yourself, for a couple hundred a month an cut up into bedrooms, was closed off and became speculation or second home residential; trophy housing.”
At the time Ireland was part of a committee working on a master plan for the upper valley. Work on the Aspen Area Community Plan began as the real estate boom was taking off. Affordable housing remained a key component of long range planning but it would be of little help in the widening income gap.
“What we conceived of was a shadow market of housing which would be not attached to the free market. We would change the paradigm from, ‘Oh you live here for awhile, you save up some money and then you buy in the free market. And we realized that already then that was not going to happen. Nobody, even then, anticipated that income inequality would be some more severe than it was even then.”
Aspen was hot and becoming exclusive. The retail sector of town began to change too attracting high-end national companies. Today, many young would-be entrepreneurs and longtime locals find it hard to compete with international fashion brands. Michael Kinsley is now a researcher at the rocky Mountain Institute, specializes in sustainable communities. Looking at Aspen retail sector, Kinsley believes that governance, as opposed to government, can offer a solution similar to affordable housing. Councilman Adam Frisch agrees. While some retailers are paying as much as 200 dollars a square foot in rent Frisch says others are not,
“…if you go half a block off, and I don’t know what they’re paying maybe 30 dollars a foot and so its not like the whole town is 200 a foot. And, so one of the things the city hall has been looking at is there a way, between zoning what can go in there and what can be built that would be more inductive for a local to give it a shot?”
Kinsley envisions public-private retail districts where rents reflect what it actually costs to maintain the infrastructure. By design it would be affordable. Likewise, Councilman Frisch sees the city creating an affordable business sector but says the role of government should not be to actively pick and choose individual winners and losers in the retail space.
“Should we start subsidizing a bunch of locals who are competing against other businesses? We probably shouldn’t get into that. But, should we make sure that there is a playing field that allows local to open up businesses? And I think you need to look at the entire core and the entire downtown by North Mill and Clark’s as opposed to just walking down Galena Street and wondering where old Aspen went.”
Adam Frisch, Michael Kinsley and former mayor Mick Ireland all agree there are certain inevitable changes beyond the control of local government. Still, Ireland says what Aspen has accomplished is notable.
“The housing program has succeeded in retaining a local population that is the envy of almost any every resort I’ve ever talked to. The point of fact is when you go and you make a presentation on Aspen government or the affordable housing program to any other resort the one question they have for you is how can we do what you did.”
Looking back, Former Pitkin County Commissioner Michael Kinsley is philosophical when asked if the visionary moves of 40 years ago achieved their goals.
“Ah, yes and no. Certainly it turned out a heck of a lot better than it would have.”