A local lawmaker wants to impose a fee on unoccupied second — or third, or fourth — homes, potentially offering a new way to alleviate Jackson Hole’s housing shortage and its long list of secondary consequences.

Rep. Mike Yin’s hypothetical fee would apply to houses left empty for more than six months a year. The Teton County Democrat argues that could induce homeowners to rent to full-time residents when they’re not around.

“I was thinking about options on how we work on our housing issues in Teton County,” he said, and he landed on vacant homes. “The fact that we have so many creates a cumulative impact on the community.”

The most obvious effect is simply a reduction in space available for local workers. Every second home that sits unused for the majority of the year is a home that could house people who work in Teton County year-round but must look instead to Lincoln County and Teton Valley, Idaho.

And there are a lot of empty homes. According to the Jackson/Teton County Affordable Housing Department, 38% of dwellings in the valley belong to second-home owners or retirees. Meanwhile, some 43% of local workers live across county lines. The implications of that statistic — and the massive commuting population it entails — include more traffic congestion, more carbon emissions and more wildlife-vehicle collisions.

Yin argues that while the abundance of vacant homes diminishes the housing supply for local workers, it also raises property taxes for “surrounding neighbors who may be on a fixed income.” He said a fee could more fairly distribute the financial burden created by vacant vacation homes.

As he describes it, he’s “trying to capture that negative externality and make it work toward incentivizing more housing in the community.” To avoid the fee, second-home owners would need to rent out their homes.

In its current draft form, the fee would be a flat rate based on square footage. Of the revenue generated, 5% would remain with the county for administration and enforcement, though it’s unclear how exactly the policy would be enforced.

The other 95% would go to Wyoming’s Property Tax Refund Program — a program that, as it turns out, Rep. Andy Schwartz and Sen. Mike Gierau, both Teton County Democrats, helped to resurrect in the last legislative session. Schwartz said that although lawmakers brought back the Property Tax Refund Program, they didn’t allocate enough funding to meet the requests they received for tax relief.

The program benefits Wyoming residents who earn less than 75% of the median household income for the county in which they live (in Teton County, that’s about $66,000), allowing them to reduce their property tax by up to half.

In the past Schwartz has tried to bend the Jackson Hole real estate market to the advantage of local workers with a real estate transfer tax, a charge on the sale of property based on its appraised value. That has proven unpopular in the Legislature.

But because the second home fee would help not only Teton County families but those around Wyoming, Schwartz argued his colleagues might be more amenable to the idea.

“It’s technically not a tax, it’s a fee, and the fee isn’t going to Teton County, it’s going to the state,” Schwartz said. “That’s going to attract some people that might not ordinarily support it.”

The concept of a fee on empty homes has lagged a bit in the United States, but other housing-challenged cities around the world have tested it and deemed it successful.

One such city is Vancouver, British Columbia. According to the Vancouver Sun, the rate of vacancy dropped 15 percent in the year after the fee was established in 2017. The number of empty homes dropped from nearly 1,100 to just over 900, and about half of those newly occupied homes are being rented. From those that remain unoccupied, the city of 630,000 raised more than $38 million.

Officials in Paris simply raised the property tax on empty homes, requiring those who don’t live full time in their homes to pay 60%, triple the standard 20%. Back in the U.S. some elected officials in Los Angeles have pushed for an empty home tax, as has the New York Times editorial board and some lawmakers in that state.

Yin has tried to structure the fee after the fashion of similar fees, like the one imposed in the last legislative session on electric vehicles, to ensure its constitutionality. Each county would be allowed to choose whether to impose the fee.

Yin initially planned to pitch his idea to the state Revenue Committee at its meeting in Laramie on Tuesday. But because the meeting ran long, he said, he decided instead to present it at 10:30 a.m. Monday during a meeting of the Corporations, Elections and Political Subdivisions Committee.

Though the fee may outrage some who feel it runs afoul of private property rights, Schwartz is optimistic about its chances. He said he’s interested to see how the fee will be received.

“I think it has validity because there are costs to the community,” Schwartz said. “A community that has a housing shortage when we have empty homes, that’s kind of ironic.”

Contact Cody Cottier at 732-5911 or town@jhnewsandguide.com.

Cody Cottier covers town and state government. He grew up with a view of the Olympic Mountains, and after graduating Washington State University he traded it for a view of the Tetons. Odds are the mountains are where you’ll find him when not on deadline.

(12) comments

Alexander Muromcew

Time to vote Republican in 2020 and have some real representation in Cheyenne for Teton County.

TERRENCE MILAN

We already pay taxes on property whether it's occupied or not. The Constitution and the 14th Amendment sort just get in the way. How about this, require all hotels to set aside housing. After all that is their business isn't it? Well you know why, don't you.

Brianna Bolton

I agree with the above comment on how are you going to regulate it. We already are not supposed to have short term rentals but yet houses all over the county do it. It already isn’t being enforced. So, how about tax people that want to do the short term rentals and that money goes back into housing. They are going to do it anyways. I feel the same about 3,4,5 homes. In Summit County Utah they tax second homes a higher property tax and that money goes back into housing for the county. If you don’t like taxation without representation then make it your primary residence. Those of us trying to make this work that make less than 6 figures a year need a place to sleep as well. How are we going to clean your house, serve you drink, take you skiing, work on our public lands, give you healthcare, etc. if we don’t have a place to lay down our heads. I also think Teton county needs to change some land restrictions on building housing so we can build affordable housing. I also agree that we need to work on our road and traffic infrastructure. Our county isn’t built to hold all the tourism that comes into Jackson. Why haven’t we been working on that?

Steven Kardas

I propose  a new law, the " Elected Legislators Unused Brain Fine"  My legislation would be a little different from comrade Yin's proposal on unused homes. Instead enduring  6 months of a legislator (democrat or republican) not using their brain, my fee would be imposed immediately and the amount determined by public referendum. Give a little power back to the public. Lets see how politicians  like it when they are held accountable. Could be a good incentive. 

Steven Kardas

Comrade Yin's tax proposal on unoccupied  homes is typical of the unworkable legislation that liberal democrats put forth. The law books are full of them. His description of the benefits of this proposal is borderline incoherent. Either comrade Yin likes to hear himself talk or much worse, he actually believes this ridiculous proposal.  Everyone just dances around the solution to house our service workers in Jackson who are so very important to the economy of the area.  As comment contributor Mr Sanden points out, the solution to housing is what every place does when land is expensive and in short supply. You must build tall building on compact real-estate. A 15- 25 story apartment building would provide  a vast amount of living space. To make the "environmentalist" happy it could be painted brown to blend in,  have hanging gardens for summer, green houses for winter, solar panels and maybe a windmill or two on top.  If the persistent attitude is no compromise, and not to give up one square inch of land to solve this deepening problem then the is no hope of a reasonable workable solution. 

TERRENCE MILAN

It's the homeowner's fault that people who come here to wash dishes, put tourists on lifts and work in tomahawk shops have no place to stay. The old tradition of the factory town put the ounous of housing the works on the factory. This is one that even the Marxist/Leninist never came up with.

Ed Sanden

Truly a hare brained idea. Laughable! This is the kind of thinking that generates full blown, innovation killing, Socialism. Why stop with this empty home concept? Why not open everybody's dwelling up? Make it all essentially public or government property! Many many more people could probably fit into houses and homes already occupied. Might have to take turns for the shower, or schedule kitchen periods. Big deal. Dig? On the surface it solves a problem, or rather a symptom of a problem. Our "rule of law" is entirely based on individual property rights - protection of self, ideas, and real property. The problem is not that there are part time empty dwellings, the problem is there are not enough of them. The fix for that is to lift the building height restriction another floor, and/or to open up the market so that people will build - affordably. Many developers create many solutions, but there has to be some return on investment. Right now, due to restrictions, the nimby factor, gadfly interference, and idealistic zoning, it is TOO EXPENSIVE to build anything, so not enough gets built. It's been demonstrated repeatedly, that it's too expensive to even try to build and go through the process of getting approvals! The unintended consequence of all this is that the Valley has become so precious, so restrictive that everybody gets hurt, from the hourly worker to the sensible contractor. Only the super rich can afford to build. Fix that! There are still millions of acres of wilderness in all of the Parks, mountains and valleys around Jackson so we're a long way from destroying Teton County. We can't turn the clock back. While we're at it, time to build some redundancy into traffic flows too!

Daniel Ewert

Mr. Yin has had some good ideas, but I think this one is problematic. Most of these 2nd homes are outside of the lodging overlay zone and short term rentals are banned. If the homeowners are required to rent it out to long-term renters they won't be able to go stay in their own home. Then there is the issue of enforcement of occupation. Are the police supposed to visit every night to see if it is occupied? Maybe we should focus on tax incentives to solve housing issues instead of tax penalties.

Dakota Frommer

Silly me, I thought that 2nd homeowners benefited Teton Co. Granted, they DO require fire and police oversight of their empty home. But they spend money on services (landscape, snow removal, caretaker service, Homeowners Assoc, alarm monitoring). They host visitors/family who also spend $ or even get married in the valley. Their visits, flying in & out, help support our airport. Teton Co does not educate their children. Many volunteer. Quite a number are philanthropists. Having lived in a large eastern city, I was used to MUCH higher property taxes than we pay here. I think that a real estate transfer tax sounds fairer. BTW, we are full-time residents.

Julie Blume

Instead of solving the housing issue with a tax, why don't you create tax incentives to build affordable housing.

Steven Kardas

Mr Yin's legislation proposal is nothing more than a money grab from home owners that can not defend themselves.  You know, taxation without representation, how convenient. Second home owners  have no rights  to vote in the local elections and have a say in their taxation.  Not fair.  Here is food for thought folks,  How does Mr Yin purpose to determine that a home is unoccupied ?  Door to door searches by the police ? Have neighbors call in ? How about a special paid  "Unoccupied Home Search Force". Call it the UHSF for short. Has Mr Yin considered the rights of the home owners that they may not want to rent out their homes and furniture to strangers ?  How did he settle on 6 month unoccupied as bad ?  How about 3 months unoccupied.?  1 month ? If you are paying taxes to government you should be able to vote in the local elections if you have a second home regardless if you live out of town or another state.  It called fairness. 

Jim Tomlinson

Hear, Hear!

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