If you build it, they will come



December 13, 2014 - 12:00 AM

You don’t get very far into a discussion of the labor shortage in Iola before the town’s lack of affordable housing surfaces.
Iola has a fair number of available houses on the upper end. It has a scattering of public, income-limited homes and apartments on the lower end. And it has hundreds of very old homes — many vacant — whose potential for rehabilitation is ebbing fast.
“What we desperately need,” says Jim Gilpin of Iola Industries, “is affordable housing for working families. We’ve been at this long enough to know that that is our biggest problem.” 
The problem isn’t Iola’s alone. Conferences are held each year in places like Wichita and Topeka, where the goal is to, if not answer the perennial problem of work force housing in rural Kansas, at least provoke some of the right questions.
For instance: How can a community overcome the fact that the rise in construction costs have outpaced the rise in workers’ wages, which means few, if any, developers are willing to build houses that are truly affordable? How do you get those large companies, who complain they lack a reliable local work force, to contribute to a housing solution? How do you encourage local developers to take little or no short-term profit in order to kick-start an environment that proves friendly to new construction and that will create, in time, a climate in which appraisals finally begin to support new sales?
Allen County attracts a high percentage of its workers from surrounding counties, which suggests that a market for affordable housing may exist. “The big question, though,” says Gilpin. “Are they making enough to qualify?”
Historically, the focus of Iola Industries has been on jobs, not housing. “But maybe we should review our mission. Because in order to keep jobs and bring in new ones, we may have to go down that road of trying to improve the housing stock.”
The Register spoke at length with Gilpin and Iola Industries president, John McRae, in McRae’s office, where the pair offered their views on the subject.
 “The thing is,” said Gilpin, “there is no panacea to a community’s housing needs, because every community needs several different kinds of housing. Whether it’s remodeling and updating older homes, or tearing them down and starting a new lot from scratch, or building a new subdivision, or building rental property — you’ve got to have several different projects going. 
“As you can tell, our biggest hurdle with improving our manufacturing environment is housing, because we have more jobs than qualified people in our county.”
“Every manager that I talk to is saying the same thing,” said McRae. “Whether it’s Russell Stover or Gates: ‘We can’t find enough good people to work.’ And housing is the thing — that was the take we got back in 2008, from the plant managers, when we specifically asked them ‘What is the one thing we can do to help?’ Like Jim said, it’s a complex web, and it’s difficult to make the numbers add up.”
“Except,” said Gilpin, “before he died, we had one practitioner, one entrepreneur, Willard Horde, who built 500 houses in his lifetime. From the 1960s to the 1990s. They were all affordable houses. They were all appropriate to the labor force. What we need is another Willard Horde.”

Willard Horde started out as a trucker, hauling hardwood flooring to Denver, Colo., in the early 1950s. He’d pull into one or another of the new housing divisions, of the sort that were going up all over post-war America at that time. He’d unload his wares — so many square feet of flooring per house — then turn around and head back to Kansas. It was on one of his long drives home, reflecting on those Colorado spec houses, that he realized he’d been introduced to his life’s work.
He quit trucking and built his first house in Iola, for his wife, Velma; it was going to be the couple’s home. Before they could move in, however, Horde had sold it. From then on, Willard was on fire.
“He was a true workaholic,” said one Iolan, who worked closely with Horde over the subsequent decades. The man asked to remain anonymous. “And he wasn’t going to ask anybody to do anything that he wouldn’t do himself. If Willard needed to swing a hammer, he’d swing a hammer.
“The thing Willard was so strong on was making affordable housing for the working-class person.”
He had one basic style, which he perfected by reiteration. “That was just his thing,” he coworker said. “When he sent out a load of materials, I’ll guarantee you, you could have hauled back in a pickup what it didn’t take to build that house.”
The key to Horde’s success, besides his single-mindedness, was that he was an owner-operator. He controlled nearly every aspect of the cost of construction: He had a lumber yard, a flooring store, appliances, heating and air. And, in furnishing homes for hundreds of Iolans, he found a way to make money, too.
Over the years, as consumer expectations changed, Horde shifted from two-bedroom, single-bath homes to three-bedroom variations. But they remained, in their scaled-back demeanor, starter homes, many of which he financed on a rent-to-own basis. 
“See, there were a lot of people for a while that looked down on you if you were in a Horde house,” the man said. “But Willard put a lot of people in their first homes. He was good to the community and the community was good to him. He was optimistic. He just thought this community was it. He never retired anywhere. He stayed right here.” Horde was eventually diagnosed with Parkinson’s. “If it hadn’t been for his illness — shit, he’d still be trying to build houses today.
“He wasn’t afraid to tackle anything when he was alive. But housing was his thing. He knew how to do that, my gosh.”

It’s unlikely Horde’s model can be imported wholesale into today’s Iola. We’re in a different economic cycle, with different banking rules and stricter code enforcement.
For instance, the city no longer allows a person to build on the 50-foot lots that were for 30 years Willard Horde’s preferred canvas.
“Still,” says Gilpin — whose first home in Iola, like McRae’s, was a Horde house — “if someone’s motivated, as Willard was, I’m convinced you can figure out how to do it.”
Ryan Sparks agrees.
Sparks is a financial services advisor in Iola, and someone with experience rehabilitating area houses in ways that make them affordable for the working family. “We’ve got to find a solution that helps the Gates employee who makes $25,000 to $30,000,” Sparks said. “I wish Willard was still here, because I think he’d find a way.” Without him, though, “We’ll have to do it as a town,” Sparks said.
The average sale price for a house in Allen County is $60,000. “If we’re going to help the core, we’ve got to be as close to that as we can,” Sparks said. “The average renter is looking for a three-bedroom, $500 a month property…. So we need to keep the cost down to cater to the market we’ve got.”
Given current construction costs, Sparks said, to build a three-bedroom, one-bath house of the kind that Horde was putting up at the end of his life: “That’s probably a $90,000 house.”
Taking the $90,000 house, Sparks says, “Let’s say the city or county donate the concrete work or the electric, let’s say Iola Industries throws in the land, let’s say the bank gives us a great deal on the debt service and the industries in town help with that service. Now, maybe that $90,000 is closer to $70,000 — and now maybe we’ve got a swinging chance at doing it.”
Getting buy-in from all of the local entities would be the first challenge. Approached recently by a housing group asking the city to donate sidewalks and driveways for three homes on the edge of town, each of which would sell for $130,000, City Administrator Carl Slaugh rebuffed the proposal, telling the Register: “People are always good at being willing to give away the city’s money.”
“Currently it’s more risk than any one person can take,” says Sparks. “But if we want any kind of volume, if we want 10 or 15 of these to happen a year, everybody’s got to help.
“Another house is good for the city, it’s good for the property tax base, it’s good for all the retailers, all the businesses in town, it’s good for the employers who need employees. It’s good for everybody. But we’ve got to find a strategy that’s fair for all involved.
“There are people from Iola and in Iola who, if it looked like a fair deal, would be on board (as investors). But I think the first thing that needs to happen is — we have to make this a priority.
“If we crack the code here that nobody else in these small towns can crack, there is no question that those people who are looking at Gates but not living here — I think they’ll move to town.”
Speaking by phone from Topeka, Patty Clark, the state director of United State Department of Agriculture’s Rural Development office, which offers grants and other assistance to communities struggling with their meager housing stock, offered this advice: “Rural communities, like Iola, need to start thinking regionally, because our resources are shrinking.” 
A community first needs to have a strategy and then be willing to take a calculated risk, she said. “If you’re not creative, if you don’t try, you’re just going to continue to complain.”

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