Legislative committee resurrected a repeatedly failed real estate transfer tax, a tax that supporters say could help turn the page on a workforce housing crisis that is weakening the fabric of the community of the most expensive place in Wyoming.
The idea behind the optional 1% county tax, which has been introduced several times by Teton County delegates, is to assess a sales tax on real estate transactions above a certain threshold. In its current form, the bill passed by the Wyoming Legislature Joint Revenue Committee could generate perhaps $ 20 million per year for de-subsidized and restricted housing or other community needs, said Rep. Mike Yin (D-Jackson).
“It could do a lot, it could really do a lot,” Yin said.
Real estate sales in Teton County are expected to exceed $ 3 billion in 2021, roughly doubling taxable retail sales in the community overrun with tourists.
“Real estate is to Teton County what coal is to Campbell County, except we can sell it over and over again and at a higher price every time,” said the lobbyist for the Association of Municipalities of Canada. Wyoming, Bob McLaurin, testifying in support of Bill.
The proposed tax structure would allow counties to exempt up to $ 1.5 million from any real estate transaction. So if a house is sold for $ 3 million, only half of that total could be taxed at the 1% rate if the county seeks the full amount exempt. But the proposed legislation also allows counties to set the threshold lower, making the tax a viable option for counties where house prices aren’t that sky-high.
Counties could sue the optional tax if half of the incorporated municipalities and county commissioners agree, or if 5% of the electorate so requests. If that happened, the property tax would be imposed on constituents in the county. How the funds would be used would be specified on the ballot “clearly and appropriately”, according to the bill.
People whose jobs involve housing Jackson Hole’s workforce say the infusion of funds that a property tax could bring in could eclipse the public dollars currently spent on the cause. Over the past five years, the Teton County government has committed $ 37 million in public housing funds, an investment that has resulted in 241 new units and about $ 100 million in additional private capital, according to the director of the Jackson / Teton County housing April Norton.
“That’s about all we can do because we don’t have a source of funding,” Norton said. “We are constantly looking at potential new projects and our main limitation is funding. We have four [affordable housing projects] ahead of us right now, but we won’t be able to afford four. Perhaps we could afford one.
Meanwhile, hourly workers and salaried professionals who provide the most basic services in Jackson Hole are increasingly being billed outside of where they work. It’s been a problem for decades, and it’s been exacerbated by an aging workforce retiring, cashing in on expensive homes, and leaving. Wealthy newcomers with jobs without localization often take their place.
“We are losing our employees,” Anna Olson, president / CEO of the Jackson Hole Chamber of Commerce, told members of the revenue committee. “My # 1 problem for employers is the lack of employee housing here, and it’s getting worse and worse. ”
Olson urged committee members to move the proposed tax forward so that it could be considered in the February budget session of the Legislature, and they did. The committee moved the 18-page bill forward on December 15 by an 8-4 vote. A year ago, the legislature’s joint revenue committee removed a 0.5% nationwide property tax. State from 7 to 6. More than half of the members of this committee have been renewed, but there was also a vote that changed: that of Representative Tim Hallinan (R-Gillette).
Hallinan was swayed by a new provision in the bill that sweetens the pot for the state of Wyoming, he told WyoFile. Specifically, distributions from the Office of State Lands and Investments to local authorities exercising property taxes would be reduced by 50% – and those funds diverted to the general fund.
Hallinan is also not sure he will vote in favor of the property tax bill once the whole House meets in February, he said. Because this is a budget session, bills require the support of a two-thirds majority to be considered in this chamber.
Two-thirds support is a “high bar” in the Wyoming tax legislature, said Rep. Andy Schwartz (D-Jackson), who has introduced a real estate transfer tax on several occasions without the support of the committee.
“I hope that even if he dies in this session, he will come back as a committee bill in the general session,” Schwartz said.
Simple majority support is needed in the general session, a “huge difference,” he said.
Newspaper records show that there have been discussions about a Jackson Hole real estate transfer tax since the 1980s, and attempts to bring the idea to the Capitol in Cheyenne for 30 years.
A similar decades-long effort by Teton County was used to pass another county option tax now common in Wyoming.
Lodging tax bills were introduced as early as 1965, according to older editions of the Jackson Hole Guide, but they were challenged by the Jackson Motel Association, and it was not until 1986 that the government of the era. Ed Herschler’s signing enacted the tax. Today, there is a 5% tourist tax on all short-term accommodation in Wyoming, and counties have the option of imposing an additional 2% tax.
Likewise, there has been constant opposition to the prospect of a new real estate sales tax. Laurie Urbigkit, director of government affairs for the Wyoming Association of Realtors, has bluntly communicated her position to lawmakers.
“Obviously, we are opposed to this bill,” she said. “We always have been and probably always will be. “
Teton’s real estate board has not taken a position on the bill, according to the Jackson Hole News & Guide. Some individual real estate agents, however, have lent their support, including the Jackson-based owner of Prugh Real Estate.
“I’m for a transfer tax,” said Greg Prugh, “or at least the counties having the option to sue.”
Urbigkit called the property tax “unconstitutional”. The 1% surtax imposed on speculative real estate investments is not fair, she said.
“Imposing a sales tax on these investments isn’t fair when we don’t tax stocks or bonds,” she said.
The private sector, Urbigkit added, can find solutions to labor force housing shortages in Jackson Hole and beyond. It is being tempted. Jackson Hole Realtors recently created a “Community Housing Fund,” a nonprofit organization that funnels realtor commissions and sellers’ income into affordable housing. The effort raised some $ 200,000 in its first month, the News & Guide reported, most of which was donated to the Jackson Hole Community Housing Trust.
Although a property tax is seen as a Teton County tool, the idea has sparked interest from other Wyoming communities struggling to house their workforce. Greater Cheyenne Chamber of Commerce chairman / CEO Dale Steenbergen, who testified in favor of a county option property tax, told WyoFile he believes the bill could benefit the southeast of Wyoming.
“We need to settle the bill so that it can serve a greater percentage of Wyoming,” he said. “I bet I have a bigger housing problem in Laramie County. Jackson would have a stroke if they had to deal with my housing problem. I need 5,000 homes today.