Tourists to Subsidize Affordable Housing? - TribPapers
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Tourists to Subsidize Affordable Housing?

Andrew Paul reviews the agenda of the local chapter of YIMBY Action. Screenshot.

Asheville – During public comment at the last formal meeting of the Buncombe County Commissioners, a handful of people thanked the board for putting changes to room tax allocations on their legislative agenda. A few even asked that it be made the number-one priority. All wanted the funds to support affordable housing or at least transit to help people who couldn’t afford to live in Asheville get to their jobs.

Ben Williamson said the current system was flawed, undemocratic, unjust, anti-family, and harmful. Expressing his beliefs in the first-person plural, he said tourists, rather than being taxed to support advertising to attract more tourists to the destinations where they lodge, should be taxed to pay for education, childcare, broadband, and housing in those communities.
It was the allocation of the tourist tax, not tourism itself, that he opposed. Current tourism marketing, he said, attracts outside investors who buy housing stock out from under locals, creating scarcity and driving up the cost of housing. This affects people who can only afford to rent as well. Indicators that the current system is not working, he said, include rising homelessness counts, costs of living, housing prices, poverty rates, and suppressed wages.

Andrew Paul, who identified himself as the founder of Asheville for All, also wanted to democratize the expenditure of tourist dollars. Asheville for All has the slogan, “For housing abundance and diverse, livable communities in Asheville.” The organization has a three-pillar platform that includes eliminating zoning laws that do nothing for health and safety, charging the government with creating housing as needed, and improving public transportation.

Asheville for All is a chapter of YIMBY Action, a San Francisco group that has since spread nationwide. Its website states, “The housing shortage is a result of harmful laws passed at all levels of government,” and so the group works to mobilize government action to reverse some of these problems. Actions include repealing zoning and permitting requirements that serve only to drive up the cost of housing, as well as persuading local governments to use federal dollars and housing bonds to subsidize the creation of more housing stock.

Paul stressed he was not anti-tourism, anti-hotel, or anti-rezoning. He believed healthy growth was better than stagnation for economies. He mentioned the YIMBY platform briefly and encouraged the commissioners to listen to the data-driven solutions his group proposed, as they would be more useful than fear-mongering reactionary claims from those attempting to preserve the status quo. He told how voters across the country have approved bonds for the government to create more affordable housing, but they can’t make a dent in the housing shortage because of restrictive zoning laws. He said the cost of subsidizing housing would not be much, and, barring litigation, the expense of changing zoning laws could already be built into the budget. 

Jen Hampton, co-chair of Asheville Food and Beverage United, spoke of the catch-22 in which her daughter and many others have found themselves. Her daughter couldn’t afford to live in Asheville, so she found an apartment outside of the county. She then wrecked her car and had no access to transit. So, she moved back in with mom. Not everybody, she said, had a person downtown with whom they could stay. She said the shortage of workers downtown was not going to abate by itself. There were a lot of people who would gladly accept essential worker jobs downtown if they could figure out how to pay rent and get to work at the same time.

Nina Tovish said tourism was distorting the local economy and creating an affordable housing crisis in Asheville. To help direct more tourism money into the service of Asheville’s poor, she recommended capping the amount the Asheville-Buncombe Tourism Development Authority spends on recruiting tourists, restructuring the tourism board with equitable representation, reducing the occupancy tax rate, or eliminating it altogether.

Peggy Crowe, a realtor, said the tourist tax had served its purpose and was no longer needed, as most people hear about Asheville now by word of mouth. She spoke of skyrocketing housing rates in the Asheville metropolitan area, which included a 10% increase in October. The average home cost is now $380,000, and Asheville’s average rent of $1,700/month is the highest in the state and 12% higher than Charlotte’s. That translates to 20% of renters spending over 50% of their income on housing.

She said the amount of housing stock was increasing, so supply-and-demand was not working in this scenario. She also described the current situation as a house of cards, as the city was reliant on outside revenue streams to support tourism. It did not have the resources, particularly laborers, because too many people were unable to rent and work in the city as previously described.

Opinion –

One reason people live in political silos these days is the way public comment is taken at government meetings. For example, several people felt motivated to speak on changing the room tax allocation, but nobody harboring a contrary viewpoint had a hunch that the matter would be on the floor. This prevented side-by-side comparisons of pros and cons, so what follows are a few points that may have been made had the platform been a normal conversation.

1. Tourism taxes are taxation without representation, because hotels are largely used by people from out of town who do not vote in the local elections. So, strictly speaking, a democratization of the tourism board, which decides which projects will receive tourism tax dollars, should give visitors who pay, not locals, a representative share of seats on the board.

2. Unfortunately, the war cry of the American Revolution was, apparently, such a no-brainer back in the day, the Founders didn’t bother to write it into the Constitution, and, unfortunately, taxation without representation is legal. Sure, everybody’s doing it, but telling visitors they cannot stay here unless they donate to affordable housing—or advertise—doesn’t measure up to ancient notions of hospitality.

3. YIMBY is correct about zoning raising the costs of housing, but involving government in the development of housing also raises costs for things like the collection and redistribution of funds and administrative overhead and oversight. Also, using federal funds will add to the national debt, which is already well over $31 trillion and rising. If the debt is to be paid off, it will be through higher taxes on future generations; the prospects for defaulting could take on any of numerous unpleasant scenarios. Bond revenues, too, must be repaid, likely by raising taxes on future generations.

4. The claim that supply-and-demand is not working is suspect. Supply may be up somewhat, but as long as there are substantially more prospective renters than rental units, prices should remain high. Also, Asheville is not a closed system. As was said, people are moving out of the city for housing, but a lot of people of all income levels are trying to move in. What’s more, housing is not fungible, so the problem must be split to see how many people of each income level are competing for the available housing stock that they can afford, with inexpensive housing always being accessible to buyers of any income.