Bruce Sacerdote is an Economist who has taught for the past quarter century at Dartmouth College. He was recently featured on a Freakonomics podcast titled, fittingly, “Why is U.S. Media So Negative?”https://podcasts.apple.com/us/podcast/freakonomics-radio/id354668519?i=1000537800146
I asked Sacerdote about the topic that has been inescapable of late: housing. Did he have any advice to local officials as to how to tackle the problem?
“Give up?” (laughter). But before even answering, he said you have to back up and be grateful for the problem. “This is what it means to be successful. It’s a sign that things are going well, and that you live in a desirable area … you’ve done something right, and not [in a governmental sense] gotten too much in the way. Remember, there’s no shortage of land in Nebraska and Detroit if people want to live there.”
“And by the way,” he added, “even in places like Nebraska and Detroit, everybody feels like they need more workforce housing.”
But this urgency to build workforce housing … Sacerdote says it seems to manifest itself particularly in higher-income areas where there exists a fair amount of guilt amongst the wealthy.
The rich enclave is a rich enclave striving to be, you know, “normal” or “real” or anything other than a privileged stereotype.
Part of the reason communities get that way (enclavish) is in how they’re zoned and structured.
As Sacerdote related, he lives in Hanover, New Hampshire where there are tight zoning controls which have led to big price increases due to scarcity. Nearby towns to Hanover, he noted, are priced fairly reasonably.
There’s also a schools component. Hanover’s schools are reputed to be superior to those of surrounding towns, which also adds to the demand.
The “raise the drawbridge” mentality, Sacerdote said, is not irrational. It’s good for homeowners because of skyrocketing property values. And it can be good for the community by limiting population and congestion.
But … whatever barriers are erected, trying to stop people from moving in “is like trying to stop the tide coming in with a shovel,” he said.
He added that Mammoth’s local government really has very little wiggle room in what it can do, because of the limited availability of private land.
The one thing it has done, acquire and now develop The Parcel, is exactly what it should be doing. “It makes sense for a town to develop underutilized areas.”
But what he cautions against is this. “The problem with workforce housing, especially if you’re spending big bucks and giving someone a massive subsidy … it’s a nice lottery ticket, but you often find that the winners of the lottery are often not the people you’re targeting. They often can be more well-heeled people who just happen to meet the financial requirements and are better at reading the rules [and applying].”
We’ll let that serve as a segué into Mammoth Town Council’s meeting Wednesday, agendized as sort of a loose workshop which danced around the usual topics: 1. how to provide more housing while, 2. defending the status quo of the budget process and preserving the town’s massive marketing budget.
On the budgeting side, Council was in unanimous agreement in maintaining its current allocations to marketing, transit and housing. Those three categories receive 4.05 points out of the 13 points of T.O.T (room tax) the town collects.
Room tax revenue accounts for approximately 60% of the town’s general fund revenue. Mammoth has the highest or second-highest (it fluctuates) reliance of any town in California upon room tax revenue to fund itself.
The conversation almost never got off the ground. Mayor Sauser was literally moving to the next topic on the agenda when Mayor Pro-Tem Salcido finally spoke up.
“I don’t think we’ve gotten off the top of the first blade of grass, never mind getting into the weeds,” she said regarding the budget allocations.
Her frustration: It’s very difficult to quantify the success of a marketing dollar. Is the MLT budget the right number? Would we get the same results at a lesser number?
Sauser then parroted the traditional alarmism about losing market share if the marketing budget is decreased by any amount.
Counilmember Rea suggested that housing, transit and marketing make their pitches each year for slices of the dedicated 4.05 TOT points. Why can’t that be a part of the annual evaluation?
Councilman Wentworth minced no words in reply. “That’s fundamentally ass-backwards. That’s not leadership. This isn’t the North Pole and we’re not Santa. We set direction. We don’t evaluate [those plans].”
Rea: “I’ve watched this for 11 years. I always hear the same thing. We can’t quantify what they [MLT] do.”
*In my notebook I scribbled the following. How come every local government entity can undertake 15-county or 15-city surveys to determine proper pay scales, but we can’t undertake any basic study to compare housing/transit/marketing budgets with 15 peer resorts?
One interesting angle which helped me understand (perhaps) Council thinking was the detail about how TOT overages go to a Tourism Reserve fund which is entirely controlled by Council, and that definitions of tourism and