‘It can only get richer’
JACKSON, Wyo. – In an era when the rich are the only income group getting richer, ever-larger waves of wealth are spilling in from the coasts and swamping the resort valleys of the Rocky Mountain West.The rich are coming not just to ski, mountain-bike or build imposing second homes. They are coming to stay – or, at the very least, secure permanent resident status for tax purposes. The moneyed invasion is driving population growth rates that are among the highest in the nation.From Aspen to Jackson to Squaw Valley, Calif., high-net-worth individuals fill sleek restaurants night after night to eat $30 plates of freshly flown-in fish. They donate generously for the arts, wildlife conservation, and preserving forest and farmland near their custom-built homes.And with millions of well-to-do baby boomers nearing retirement, the Rocky Mountain resort forecast is for years upon years of the incoming rich – seeking big sky, big houses and the comfort of others who can afford to live large.”The herd instinct is as strong with multimillionaires as it is with any two- or four-legged animal,” said Bob Graham, 69, a real estate agent in Jackson for three decades.Graham has marveled – and profited – as this well-heeled year-round herd has grown thicker in the past 10 years. “It has been a wonderful blessing,” he said.Not everyone feels that way.
The rich have collectively inflated real estate to prices that are far beyond the means of those who serve them supper, take their blood pressure or police their gated subdivisions. The service workers – professionals and blue-collar alike – tend to live in adjacent valleys and commute.There is simmering resentment of the rich. Before a tour of pricey houses here last year, vandals stole 40 signs and changed the name of the tour from “Parade of Homes” to “Parade of Wealth.”For seven consecutive years, Bloomberg’s Wealth Manager has declared Wyoming the best state for the tax-averse rich to establish residency. Wyoming has no income tax, and most other taxes are either low or absent.Along with everyone else in the state, the rich are spared the burden of taxation because of soaring receipts from taxes on oil and natural gas extraction. (Other states in the Rocky Mountain West have income taxes, but the rates are low compared with those on the coasts.) A household making $500,000 a year would have paid $53,921 in local taxes in 2004 in the District of Columbia but just $6,809 in Wyoming, according to Wealth Manager.”Your accountant will tell you that if you move to Wyoming, the house will build itself,” said Angus MacLean Thuermer Jr., co-editor of the Jackson Hole News & Guide.Most millionaire newcomers are building their houses here in Jackson Hole (the name refers to the valley that lies in the shadow of the Teton Range and encompasses much of Teton County). They have made it the richest and fastest-growing part of the state.Vice President Cheney has a home here. So do actor Harrison Ford and former World Bank president James D. Wolfensohn and Christy Walton, widow of Wal-Mart heir John T. Walton, whose wealth was estimated by Forbes at $18.2 billion and who died after his home-built aircraft crashed last year near Jackson.
There are several thousand others in Teton County (population 19,000) who are not famous, but merely extremely rich. They tend not to draw attention to themselves, driving pickups instead of Porsches and wearing blue jeans to four-star restaurants.Their money, though, shows up rather spectacularly in tax returns. Since 1999, Teton County has ranked first or second among the nation’s 3,140 counties in adjusted household income, according to the Internal Revenue Service. Most of the income comes from investments, not salaries.
As an engine for growth, the rich – together with their demands for high-end housing, elaborate landscaping, upscale shopping, fresh food and assorted highbrow diversions – have all but taken over Jackson and several like it in the Rockies.In the 1990s, despite a decline in tourism and skiing in Jackson Hole, per capita income multiplied at about five times the national rate, unemployment all but disappeared and the Latino population grew rapidly to fill service jobs.”We used to be a tourism economy; now we are a lifestyle economy,” said Jonathan Schechter, executive director of the Charture Institute, a local think tank, and an economic analyst who studies resort towns.Besides spending buckets of money on their houses, the rich have been extraordinarily willing in recent years to give money away.”It is craziness – every year there is just more and more and more,” said Clare Payne Simmons, who until last year was president of the Community Foundation of Jackson Hole, which has raised nearly $39 million for local charities since 1997.Teton County has become one of the most philanthropic places in the country, as measured by tax-deductible donations per household, IRS figures show. Households here gave away about $9,000 a year in 2002, nearly nine times the national average.”What happened was that there were a number of influential individuals who created a social norm that mandated philanthropy,” Simmons said. “Social engagements were all centered around giving.”Charitable giving, however, has not altered what many local residents agree is the fundamental social problem of Jackson Hole: unaffordable housing for the un-rich.”The future is locked in – it can only get richer,” said Brian Grubb, planning director for Jackson. This story first appeared in the Washington Post. Vail Daily, Vail, Colorado