When your landlord is also your boss

As home prices skyrocket and renters feel the pinch, a brewery in Columbia Falls and the hospital in Bozeman aim to ease the burden with employee housing.

By Justin Franz MONTANA FREE PRESS

COLUMBIA FALLS — When Carla and Darin Fisher opened Backslope Brewing in Columbia Falls in 2016, they knew they wanted to take care of their employees. Six years later, they offer competitive wages, health insurance, retirement benefits, long-term disability and even paid time off for their full-time employees — all rare perks for service industry jobs these days.

But offering to house employees was something that had never crossed their minds — at least until last fall, when they were struggling to find enough people to work and had to cut their operating hours in half.

“Finding employees is always a challenge,” Carla Fisher said recently at the brewery and restaurant along U.S. Highway 2 in a town that labels itself the “gateway” to Glacier National Park, “but last fall it was impossible.”

Fisher put the blame squarely on the Flathead Valley’s ever-worsening housing crisis. To help with the situation, Backslope is currently putting the finishing touches on two dorm-style rooms in a recently purchased building next door to house employees who might not have anywhere else to go.

While employee housing is nothing new in these parts, it is rare for a small business like a brewery to provide it. For years, organizations like Whitefish Mountain Resort and Xanterra (the company that operates hotels and restaurants in and around Glacier National Park) have maintained dormitories to house seasonal workers who come from around the world to work in this picturesque part of the state.

But the pandemic spurred a migration to the Flathead Valley and places like it, sending home prices to unprecedented heights. In fact, in 2021, the Kalispell area was the fastest growing in the state. Prior to the pandemic, in late 2019, the median home price in Flathead County was in the low $300,000 range; in February, it was $580,000. The climb has been even more dramatic in the nearby resort town of Whitefish, which went from a median home price of $392,000 in January 2020 to $900,000 in February 2022. Increasing home prices have pushed some renters out of the area, too, as landlords cash in on the red-hot market.

In Whitefish, some business owners are looking at forming a cooperative to secure vacation rentals and get the keys into the hands of local workers at a reduced rate. One of those efforts, the Whitefish Workforce Housing Project, was spearheaded by Ed Docter, the owner of a bar and ski rental shop. Docter has framed the issue as a battle to maintain the community’s character and prevent it from turning into a carbon copy of every other resort town in the American West.

“If we don’t house our characters, we lose our character,” he said.

For years, people who were pushed out of the Whitefish real estate market could find cheaper alternatives in nearby towns like Columbia Falls, but even that has changed in recent months.

Fisher said last year was challenging for her business and her employees. The brewery normally employs 35 to 40 people during the off-season and 50 people in the summer, but starting last fall she wasn’t able to maintain those numbers because some employees lost their housing and were forced to leave the area. She knows of at least one instance when an employee had to temporarily live in their car. And she almost lost her head chef and one of her lead cooks after they lost their housing, resulting in a stressful and unsettling few weeks.

Fisher also said that she and other local businesses are trying to hire an ever-shrinking pool of people looking for jobs. With unemployment so low in the area (it was hovering around 2-3% last fall), there just aren’t that many potential candidates, and people don’t feel the need to stay at jobs if they find something better. Fisher said in the last six months she’s hired 30 people to work for her, but many of them haven’t worked out. She said that prior to the pandemic, she might have hired 10 people during that same period.

During the summer, Fisher’s employment pool is bolstered by local high school students on break and international students working with J-1 visas. J-1 students usually end up working for larger organizations (such as the ski resort or park concessionaire), but through happenstance Fisher was able to hire one last summer. This year, four students will be spending the summer at the brewery, and they’ll be the first to live in the dorms next door to the brewery.

Prior to being purchased by Backslope Brewing, the one-story building next door housed a State Farm Insurance Company office. Fisher said they plan to turn the main floor into a food-prep area to give their brewers more room in the main building. The dorm rooms — two bedrooms with bunk beds — will be in the basement. They’re also adding showers and another bathroom. The City Council recently approved a zoning change for the building so that people can live in it.

Once the J-1 students leave at the end of summer, the beds will be available to local employees who find themselves between homes or otherwise without secure housing. Fisher said she hasn’t yet determined what she’ll charge for the rooms, but she said it will be minimal. She hopes the rooms will be used by people only as a last resort.

“I really don’t want to be a landlord for my employees,” Fisher said. “I would never want someone to stay at their job only because they were worried they might lose their housing.”

Fisher said she knows that housing a few of her employees won’t solve the Flathead’s housing crisis, but she is hopeful that it will help a few people and enable the brewery to keep regular hours.

A similar effort to make sure workers are housed is also underway in Bozeman on a bigger scale. Bozeman Health announced in December that it would partner with a local construction company to build 50 apartments to house up to 100 employees. Bozeman Health’s Chief People Officer Edie Willey said the hospital system has lost numerous employees in recent years due to the increased cost of living in Bozeman. The median price of a single-family home there is approaching $900,000.

“During exit interviews, we’d ask people why they’re leaving us, and they’d say, ‘I just can’t afford to live here anymore,’” Willey said.

The new apartments are expected to open next year, although, realizing that it was facing an immediate crisis, the hospital purchased two townhomes recently to serve as temporary housing for new employees or those who have lost their housing. Like Backslope Brewing, the Bozeman hospital said it doesn’t want employees to stay in the apartments long-term.

Both Willey and Fisher said that having to figure out where to house their employees was something that had never crossed their minds as employers, but in 2022 it is — in Montana and in many places in the West.

“It’s an epidemic,” Willey said.