STORY AND PHOTOS BY KAREN BOSSICK

A quarter to a third of Ketchum’s streets are disintegrating—cursed with structural problems after years of inadequate spending to address the problem.

To address that, the City of Ketchum wants to ask voters to approve a tiny increase to local option tax in November to fix the streets they drive on every day.

"The city has spent $150,000 a year maintaining all of the roads that you drive on," the city’s director of finance Brent Grant told those attending a monthly Coffee Talk at FRX this past week. "Ask yourself: If you went to go add on to your house in Ketchum, how far would $150,000 get you? It might get you a nice patio."

A road study using laser-imaging technology found that while Ketchum's 86 miles of roadway are holding up overall, a quarter to a third of the city's roads are beyond the point where chip seal — the go-to Band-Aid of the past 40 years — can do much good.

The study recommended the city pony up $4 million a year to fix the roads. The city landed on $2 million as a realistic target.

“I don't have a money tree out back," Grant said.

That's where the LOT tax comes in.

The original LOT has been around since the late 1970s and has been renewed five or six times. It currently collects 1 percent on retail, 1 percent on building materials, 2 percent on lodging and 2 percent on liquor by the drink.

Together those categories bring in about $3.9 million a year — every dollar of it already spoken for. Some $1.5 million goes to public safety. Another $878,000 funds Mountain Rides. Wagon Days get $324,000. And about $1 million goes to the capital improvement fund for sidewalks, streets and equipment.

The question going to voters this November is whether to increase the tax by a small amount to generate the $2 million needed for roads.

"We can't lose what we have, so whatever we need to ask for needs to be really simple and really straightforward," Grant said.

The Ketchum City Council has been weighing two approaches: Increasing just the lodging tax, which is essentially a pure tourist tax, or spreading smaller increases across multiple categories.

Grant said he expects council to find common ground on an approach soon and he wants the public to weigh in before they do.

To that effect, the city will host pop-up education events today through Wednesday--June 8-10. Grant will be at Ketchum Town Square from 11 a.m. to 1 p.m. today, the Ketchum Post Office on Tuesday and the Forest Service Park on Wednesday during the first Farmer’s Market of the season.

Grant will set up four information boards explaining what the LOT is, how it works and what it funds. Then he'll hand each visitor five stickers and ask them to indicate which tax categories they'd increase.

"I'm hoping I can get 200 people between three locations,” he said. “And I'm happy to have  200 conversations."

Grant said he's had roughly 200 one-on-one conversations with community members already and acknowledged he may have overestimated how much the public understood about the LOT going in.

"I almost want to apologize to some degree, because I assumed that people knew more about how the LOT works than what they maybe did know.”

Ketchum's reliance on property taxes is just 39 percent of its general fund. Twin Falls relies on property taxes for 70 percent of its revenue and Boise is in the high 60s.

Ketchum’s reliance on property taxes is so low because the LOT tax has been wildly successful.

"Without the local option tax, the City of Ketchum's services as you see it today would be drastically different. Period," Grant said.

The urgency is compounded by the coming loss of the Ketchum Urban Renewal Agency, which sunsets in 2030. KURA has been the single largest funder of the city's capital improvement plan, contributing roughly $2 million a year. When it goes away, the city will recapture only about $500,000 to $600,000 in property tax growth — a gap of nearly $1.5 million.

"That's another reason why the timing of the LOT vote is so important," Grant said. "Our No. 1 funder for our capital needs is going away, and there's nothing we can do about it."

Grant said the ballot language for the LOT measure will likely tie any increase to a 15-year term matched to a 15-year capital improvement plan covering roads, sidewalks and bike paths. Mayor Pete Prekeges’ pet project is a multi-use bike path from Serenade Lane along 2nd Avenue to Atkinson's, then up 4th Avenue to connect with the existing path at Spruce Street that leads to Sun Valley.

When the inevitable question about locals paying tourist taxes came up, Grant was characteristically blunt. A local’s discount card at restaurants would be an administrative nightmare, he said. But if the LOT vote succeeds, council could choose to forgo its allowable 3 percent annual property tax increase, giving back to residents that way instead.

He also pointed out a distinction many residents miss: the liquor LOT applies only to liquor by the drink at restaurants, not to bottles purchased at the liquor store.

The city is commissioning a credit card data study to settle the longstanding debate over who pays the LOT. Previous data from Visit Sun Valley suggested a roughly 75-25 tourist-to-local split. Grant noted one telling data point: LOT revenue in November, when it's mostly locals in town, was $300,000 to $350,000. In December, with just two weeks of tourist season, it jumped to more than $900,000.

Grant also pledged to continue honoring the city's promise to reduce property taxes by $750,000 annually following the successful fire district vote, even though the city isn't legally required to do so.

"If my word can't be trusted, then who am I?" he said. "I might as well just be gum on someone's shoe."

WHITHER THE KETCHUM POLICE?

Before the LOT discussion dominated the morning, Daniel Hanson, the city's engagement manager, told attendees that all nine officer positions and one administrative position for the Ketchum Police Department have been filled since the city elected to get out from under the Blaine County Sheriff’s Department.

A police chief search is underway with interviews expected in coming weeks. The department will launch Aug. 3, he said.

Every officer hired is a former Blaine County Sheriff's deputy; seven were previously stationed in Ketchum. The city even has a waitlist of officers wanting to join.

Annual operating costs remain the same as under the sheriff's contract. One-time startup costs of $125,000 to $175,000 for new uniforms, vehicle graphics and IT connections are covered by a $223,000 refund check from the sheriff's office, which was returned because the office was understaffed under its contract for years.

Hansen said the city was happy with the job of the Blaine County Sheriff’s Department was doing but wanted direct oversight.

Mayor Pete Prekeges said the new department would emphasize community relationships over citations.

"I would rather see more warnings a day than tickets," the mayor said. "We want that person to say (Ketchum is) the coolest place ever — even the cops. Or especially the cops."