A calm and reasoned way forward

One Community, One Town, represented by citizens of both Sun Valley and Ketchum, began with one simple goal in mind. We initiated a discussion to calmly explore the merits of a potential consolidation of two towns with the sole aim of improving the potential for our community and for our children.

We live in one community; we are in the same business; we face common challenges; and by coming together, we could not only save money, but also improve our common fate. Through this process, we learned a lot about our respective towns’ finances and more. This has created both useful debate, but also fear and rancor, which was not our intention. Some folks are aggressively raising emotional and “cultural” objections that act far more to divide us than to bring us together.

It is most unfortunate that willful misrepresentations and political sound bites intended to stir up emotions and cause fear have clouded the financial and legal discussion, and that alleged “cultural” differences have galvanized many opponents. Apparently a few vocal people in Sun Valley really believe they are a different kind of people from those in Northwood, Bigwood, Warm Springs, River Run, Thunder Springs and other Ketchum neighborhoods.

Even more disturbing are the personal attacks on individuals who have no agenda other than facilitating a discussion of the pros and cons of consolidation. Additionally, it is puzzling that two Sun Valley elected officials actually traveled to Boise to argue against an amendment to Idaho Code that would have allowed the citizens of merging cities to vote on the name of the consolidated city— they acted against voter choice, substituting their own judgment over that of the citizens.

A calm, open discussion of facts might still be possible, and could be facilitated by both the One Community, One Town and the Save Sun Valley groups agreeing to four things:

1. An independent third party municipal finance expert reviews both groups’ financial analyses and provides a report on the comparable state of finances for each town, including debt levels, financial health, tax levels as well as potential areas for cost savings through consolidation of services.

2. An independent legal expert (e.g., a retired judge) assesses the legal issues associated with a consolidation including topics such as naming, governance during an interim period, grandfathering of zoning ordinances, etc.

3. A joint working group is formed to address other issues and to present all the findings to the community.

4. Upon completion of the first three items, Wayne Willich and Nils Ribi, both Sun Valley elected officials who have expressed strong opposition to consolidation, jointly agree to a moderated debate with Charles Conn and Dave Chase, the Ketchum and Sun Valley council members who support a community dialog regarding consolidation.

One Community, One Town agrees to the above requests. We are proposing this framework to the Save Sun Valley group. If there is agreement, we will work cooperatively to implement this proposal. In any event,,, we will continue to pursue our belief that the citizens of both Sun Valley and Ketchum will realize substantial benefits from some form of consolidation, Further exploration and discussion is merited, whether it is only in regard to essential services or goes beyond. We are willing to undertake this endeavor at a moderate pace, for the long-term well being of our community .

Sincerely,

One Community, One Town

“Save Sun Valley”? From What?

We invite a third party audit of finance and legal questions with full public disclosure on the figures cited below as well as the figures presented by “Save Sun Valley”.

Consolidation = Annexation: WRONG

• Annexation is incorporation of an unincorporated area into an existing city.
• Consolidation is a merger and only occurs when >50% of the voters in each city approve. Therefore, a “hostile takeover” is impossible.
• One Community, One Town supports naming consolidated city Sun Valley or Sun Valley-Ketchum.
• Goal is to make entire community prosper and thrive and enhance the international brand.
• Opponents of consolidation are lobbying against Idaho Bill S1157 that would facilitate naming the consolidated city Sun Valley. WHY?

Sun Valley, as we know it will no longer exist: WRONG

• NO ONE is advocating eliminating or revising Sun Valley P&Z ordinances. Ordinances and zoning in which rights are vested are grandfathered under consolidation code.
• Ketchum and Sun Valley both have areas of low density, quiet neighborhoods and neighborhoods with clustered housing.
• Both cities Comprehensive Plans have commitments to open space.
• Consolidation will give Sun Valley citizens a voice in all P&Z decisions affecting our common downtown.
• Consolidation will improve our ability to market our tourist-based economy. Increased tourism will boost our threatened economy and quality of life. The failure of our downtown economy will mean Sun Valley will cease to exist as we know it. We will all be in a ghost town and be going to Hailey for our goods & services.

Excellent City Services: Both Towns Have Excellent Services

• Ketchum has large, professional 24-hour full time fire department with highly skilled EMT’s that helps support Sun Valley services.

Sun Valley Closeness to Nature: FUNNY!

• Ketchum has elk, foxes, bears, birds, etc too! Everyone respects animals and nature.

Sun Valley is Less Commercial: Totally Irrelevant

• Ketchum’s shops, restaurants, dry cleaners, services are for everyone’s benefit.
• No one is advocating establishing a new business community on Fairway Road, Elkhorn Road, Morningstar Road or anywhere else.

Ketchum is Fiscally Irresponsible: WRONG

• Sun Valley taxes property owners by a factor of roughly twice that of Ketchum for its operations.
• Over a 10-year period a $1,500,000 residence in Sun Valley is burdened with $17,000 more in taxes than the same residence in Ketchum.
• Sun Valley’s high taxation is what creates its excessive fund balance. Sun Valley’s fund balance coverage is over 50% when GFOA recommends 5-15%. This is your money. Ketchum’s budgeted fund balance is approximately 15%.
• Both towns have modest general obligation debt. Sun Valley has proportionately more. In consolidation, both towns are responsible for their own prior debt and obligations.
• The Sun Valley fund balance will not be lost and, in fact, can be refunded to Sun Valley taxpayers and/or used to pay down existing Sun Valley debt.
• Why don’t Sun Valley’s officials want to take advantage of a minimum of $2mm in savings that would be generated by consolidation? That’s Fiscally Irresponsible!

We invite a third party audit of finance and legal questions with full public disclosure.

Thorson, Conn, Chase won’t run

In an effort to stifle discussion and debate on a topic that could save taxpayers $2MM or more, a concerted FUDD (fear, uncertainty, doubt & distraction) campaign is under way. One of the conspiracy theories involves Jon Thorson running for office in a combined Ketchum and Sun Valley.

Jon Thorson has stated he wouldn’t run for mayor in a combined city. His contribution to the community includes his role as chair of the hospital board and acting in Clint Stennett’s Senate seat are keeping him busy along with family. Like Charles Conn and Dave Chase, he simply wants what is best for the community. There is no political agenda.

Conn and Chase have previously stated that they wouldn’t run in a combined city.

When you add it up, we are left wondering what the public officials opposed to putting the merger question to the voters are afraid of.  Maybe the towns will decide to combine services to achieve significant savings, while maintaining separate administrations, or some other plan. Surely we are better for having come together and discussed the facts, whatever the outcome.  All we’d ask from people in the community is to fully consider the topic, ask hard questions and to gather information from sources that aren’t trying to protect their jobs.

Summary of $2MM savings

One of the questions One Community, One Town has received is how we arrived at the $2MM savings. This post outlines how we arrived at that conservative figure. It should be noted, however, that ultimately the newly elected body will determine how much savings can be realized. We deliberately chose the low-end of the cost-savings range as the community may want to improve service levels which would take away from some of the savings. Nonetheless experience has shown in other consolidation of small communities that savings are roughly 30% of the combined budget which equates to ~$6MM of annual savings. We believe achieving one third of that is very straightforward. Any elected official with familiarity with city budgets could easily arrive at a more aggressive figure but our goal was to stay conservative.

The no-sweat savings are approximately $2mm (~10%) don’t go beyond the obvious. Clearly, there’s no need for a duplicative set of department heads and assistant department head (i.e., going from 4 to 2 or 2 to 1 FTEs for given departments). In addition, there would only be one city administrator, one set of elected officials and one P&Z. The fully burdened cost of those headcount savings is roughly $1.5MM of the $2MM savings. In a bottoms-up review of headcount, out of the roughly 90 employees in the two towns, 16.5 FTEs would be redundant. Other communities have been more aggressive on headcount savings but we believe our community has high expectations so we used the low-end of the range and didn’t assume further efficiencies (e.g., we have departments with 2x the headcount of other mountain resort towns).

In addition there are substantial and obvious operational savings. For example, elimination of the extra city hall would result in substantial savings. Further there are other items such as savings in computer and telephony where taxpayers would only be paying for one versus two sets of software licenses and service contracts. There are corresponding capital needs associated with the redundant 16.5 FTEs. Collectively, the operational savings and eliminated capital needs make up the balance of the $2MM estimated savings.

Beyond the operational savings from having one versus two city halls in our community, we haven’t taken into account the value of spare city hall (a few million dollars). Again, the newly elected officials would determine how best to utilize the spare city hall. One of the more compelling ideas floated is to finally tackle the issue of housing for emergency services personnel. With an aging population, there is universal agreement for the need to have emergency services personnel living in our community. Even staunch opponents of affordable housing believe this is one area that needs to be addressed. The reality is there has been very little progress on this issue and limited monies have been set aside in city budgets to tackle this but haven’t gotten the job done. This would finally allow the community to tackle this issue.

Without a doubt, the biggest downside of a consolidation is the individuals working in the towns that would be affected. While the new leadership would ultimately make the decision, other experiences have shown that most of the redundancy can be eliminated via normal attrition. There would be a transition period as the towns came together and reasonable severance packages could be developed for the remaining people. We believe both cities have strong staffs and believe these would be some of the most attractive prospective employees for new endeavors that may come out of a consolidation.

Further financial analysis on per tax parcel basis

A new version of the City Economic comparison that provides per tax parcel data, re-classifies some debt, and makes other small adjustments suggested by Mayor Willich and Councilor Ribi has been posted below. Charles Conn also added comparisons to other mountain resort communities.

Sun Valley & Ketchum City Budget Comparison

Ketchum & Sun Valley Budget comparison

In response to concerns regarding the budgetary situation in Ketchum, an in depth multi-year analysis was done by Charles Conn. The slides indicate a very similar situation between the two cities. The primary differences are a greater debt level that the Sun Valley taxpayers are accountable for as well as some past years where Sun Valley spent significantly more than revenues. All of the data is from publicly available information.

This presentation has been replaced by a subsequent financial analysis in a later post.

Media Coverage

Thus far, the efforts by Citizens for One Community, One Town have received coverage on KECH Radio, KTVB, the Idaho Mountain Express, SunValleyOnline and The Times-News. [See links below]

News links:

• Citizen Group pushes Sun Valley-Ketchum merger
  
• Should Ketchum & Sun Valley merge
• Councilors hope for merger vote
• Petition effort underway to merge Ketchum & Sun Valley
  
• Elected officials weigh in on city merger
• Consolidation debate could be hot

Press Release: One Community, One Town

On Monday, February 23rd the following press release was sent to the media:

FOR IMMEDIATE RELEASE:
Contact:
Dave Chase & Charles Conn
ONE COMMUNITY, ONE TOWN February 23, 2009
An ad-hoc group of citizens, non-profit and business leaders, current and former elected officials and second homeowners have formed Citizens for One Community, One Town. The intent is to place the idea of consolidating Ketchum and Sun Valley on a ballot for consideration by the voters in both cities.
Citizens for One Town, One Community believe we are one community that shares a common interest, downtown, economy, cultural activities and more and that we would be better served by one government.
Spokesperson Charles Conn expressed that “Many visitors to the area express confusion and bewilderment over the division of Ketchum and Sun Valley. It isn’t clear where one city begins and another ends. They ask why the downtown is housed in one city, while the resort is in another.”
One of the most compelling arguments to merge is the estimated cost savings of approximately $2 million/year. Spokesperson Dave Chase states, “Consolidation of the two cities has been talked about for twenty years but fiefdom protection has thwarted efforts in the past. The tremendous cost savings can be utilized to improve infrastructure, reduce taxes and/or provide better services to its citizens.”
There are two ways for letting the voters of Ketchum and Sun Valley decide to merge. The first is a resolution where each City Council and Mayor votes to hold a special election with the issue on the ballot. The second is to organize a citizens’ petition. “We feel that the citizen petition allows the broadest public involvement and transparency. There are numerous compelling reasons to merge the two cities and we owe it to our constituents and our visitors alike to take this issue under serious consideration.” – Charles Conn.
Citizens for One Town, One Community have already done extensive analysis and study of the consolidation and will hold a Town Hall meeting in the coming weeks to discuss the benefits, review the procedures and to answer questions.
Dave Chase conveyed, “We have anticipated many of the questions as they were ones we had ourselves. For that reason, we have developed a whitepaper that outlines our perspective on the questions people have as well as let you know about the legalities of the process. We have created a website where this whitepaper is posted – http://www.onecommunityonetown.com. We invite you to review that and ask any questions that you might have so that we can respond with the answers.”
If you wish to sign the petition to put this before the voters of Ketchum and Sun Valley, please email us at oneconet@gmail.com.

Top 10 Reasons to Merge Ketchum and Sun Valley

1. Sun Valley and Ketchum are one community, but two towns. We share our downtown, our economy, cultural activities and more.

2. A merger of Sun Valley and Ketchum would result in savings due to efficiencies of approximately $2 million/year. That means we have squandered about $40 million over the past 20 years that could have been invested in our community programs and infrastructure and possibly lowered our property taxes! Future cost savings can be invested in initiatives that will improve our community’s economic outlook and our sustainability.

3. Homeowners in Sun Valley would have a greater voice in decisions made about their downtown. Ketchum voters would have a greater say in decisions about proposed development by Sun Valley Company. If downtown Ketchum deteriorates, property values in Sun Valley will decline. Conversely, when Ketchum thrives, property values in Sun Valley rise and vice versa.

4. Consolidation of the two cities has been blocked in the past because of “fiefdom” protection. Now is the time to come together for the benefit of our current citizens as well as future generations.

5. We must pool our community resources to better deal with challenges of today and tomorrow. It’s important to note that neither city nor any property located therein is legally responsible or obligated for any debt or obligations of the other city incurred prior to the effective date of consolidation.

6. Service levels will remain the same and in many cases will get better. Fire response time can be shortened and EMT response can be substantially improved.

7. Design Review Standards should be maintained. The combined town honors the zoning codes already put in place and adheres to existing design review requirements for that neighborhood.

8. Leverage valuable real estate. In merging the two towns, many of the efficiencies come from eliminating redundancies such as two city halls.

9. Ours is a tourist-based economy. One town allows marketing our area more effectively and more efficiently.

10. Elected officials have a fiduciary duty to put the consolidation decision on the ballot and let the decision be made by the voters. Once this petition is filed, there will be a town hall meeting to review the process, the pros and the cons and to answer your questions. It then becomes your decision. If consolidation is passed, there will be election of a mayor and Council. Exercise your right to decide what is in the best interest of our one common community. Community means common unity, and it is time for us to recognize this and work together.

Position Paper Executive Summary

The purpose of this position paper is to advocate for a change we feel is long overdue. Sun Valley and Ketchum are already one community deeply intertwined: Ketchum represents the downtown commercial and business center with year-round residents, 2nd homeowners and visitors. Sun Valley is home to the single biggest economic driver in the valley – The Sun Valley Resort as well as many year-round and 2nd homeowners. This paper will address the following items:

• Legal ramifications of city combinations
• Financial and economic development implications
• Health and safety service levels that are expected in the combined communities

Executive Summary
Sun Valley and Ketchum are deeply interdependent. Like the bow of a boat Ketchum is in that it is the place most people first see and experience when they arrive in the north Wood River Valley and where much of the local dollars are spent; Sun Valley is home to the economic engine of that boat.

For over two decades there have been discussions regarding a Ketchum and Sun Valley combination. Fiefdom protection from your city representatives (elected and appointed) has thwarted these efforts until now.

An ad hoc group of citizens, business leaders, non-profit leaders, 2nd homeowners and current and former elected officials agree that today’s economic challenges demand that we do what is best for everyone – have the municipal government reflect what is already reality. That is, we are one community that shares a common interest, downtown, economy, cultural activities and more. Now, more than ever, we need to pull together to not only address these challenges but also take advantage of the opportunities of combining our two cities that is available to us.

In today’s dollars, it is estimated that roughly $2MM per year in efficiencies could be realized by the merger of Ketchum and Sun Valley. This is a conservative estimate based upon an analysis of a proposed combined Ketchum and Sun Valley budget. The analysis was done by current and former elected officials as well as people with deep experience in city management both in the Wood River Valley and beyond. Savings come from headcount, operational and capital costs. Multiplied over the past 20+ years that is well over $40MM of squandered savings while city representatives have been protecting fiefdoms rather than acting for the greater good. Ketchum has just over 2000 voters and Sun Valley has fewer than 1000 voters; yet there is the full complement of duplicative municipal bureaucracy whose City Hall’s are separated by the distance of one mile.

This paper will answer many of the questions and concerns about consolidation. Those questions that are not addressed here will be in an open and transparent forum at the town hall meetings that will be organized to further seek community input. We invite you to engage with us to ask any questions we may have missed.

There are two ways of letting the citizens of Sun Valley and Ketchum decide to merge. The first is a simple council resolution where each City Council and Mayor votes to add a merger referendum to a ballot. The second is to organize a citizens’ petition. We feel that the citizen petition allows the broadest public involvement and transparency on this important issue.

Reaching out to members of the community, there have been several themes summarized below on the strong rationale for combining the two governments of Ketchum and Sun Valley:

• The current economic difficulties require decisive action on something that has been considered for decades – now is the time. We’ve already squandered millions of dollars in cost efficiencies in the 20+ years city consolidation has been discussed but not pursued. With our economy suffering, we can’t afford to squander more taxpayer money. Plus, this money could have been used to strengthen our cities infrastructure, reduce taxes and provide better health, safety and welfare to the citizens.
• There is over $2MM of recurring annual savings that could be realized as well as a one-time boost from duplicative real estate (i.e., two city halls).
• As a result of the merger, the redundant city hall could be used to house emergency services personnel (either directly or by leveraging the real estate value to locate housing elsewhere) while also providing an economic stimulus if new construction was needed (i.e., there was a better location).
• Those in opposition are driven by protecting fiefdoms rather than the good of the community. We can no longer let fiefdom protection thwart what is best for the community.
• Sun Valley voters would like a voice in “their” downtown and Ketchum voters would like a voice in what happens in Sun Valley since the success of the Sun Valley Company begets the success of Ketchum commerce and the area’s economy.
• The elected officials of each city have a fiduciary responsibility to analyze the pros and cons of a city consolidation for our mutual economic sustainability. If elected officials do support a merger, the measure should be placed on each city ballot. As public officials they need to clearly communicate their viewpoint and analysis prior to a vote. In the public interest, a responsible public official should not stand in the way of putting this issue on the ballot. Not giving citizens a vote on an issue is not consistent with our democratic government.