A Billion Dollar Bet, Part 4

Big Sky Resort, tucked among the wild peaks of southwest Montana, began with NBC News anchor Chet Huntley’s dream of “if you build it, they will come” in 1973 and is now attracting visitors and second homeowners in droves. Today, Big Sky epitomizes the modern Wild West as developers are betting big money, to the tune of $1 billion by some accounts, that it will be the world’s next great destination resort community, while its full-time residents hang on for the ride.

In this five-part series, Jackson, Wyoming-based writer Brigid Mander and Explore Big Sky staff interviewed nearly 100 sources to chart the development history of a community that sprouted at the base of a ski area—unusual for Western resorts that typically began as mining or railroad towns where ski infrastructure followed.

This series will take readers through the unorthodox development history of Big Sky, from Huntley’s big idea in the ‘70s; Boyne Resort’s purchase of the resort after Huntley’s untimely death; Tim Blixseth’s acquisition of large swaths of land around Big Sky Resort and his founding of the private Yellowstone Club; financial ruin of three large resorts during the Great Recession and CrossHarbor Capital Partners’ acquisition of them in bankruptcy court; and the explosive development, challenges and opportunities happening here today.

At the core of the community is an iconic, towering peak that’s been drawing snow speculators for more than four decades. – EBS Staff

Read part one here.
Read part two here.
Read part three here.

Part 4: Affordable housing, water and sewage, and traffic issues accompany explosive development

By Brigid Mander EBS Contributor

In the nearly five decades since its contentious introduction to the world, Big Sky has evolved as an outdoor recreation paradise. In addition to exceptional alpine skiing, Big Sky draws visitors to its Nordic ski trails, blue-ribbon trout streams, and growing summer offerings, especially mountain biking.

Its proximity to the rapidly growing university town of Bozeman is increasing the pool of locally based day visitors, and the Bozeman Yellowstone International Airport is now the eighth busiest airport by volume in the Federal Aviation Administration’s Northwest Mountain Region, according to airport director Brian Sprenger.

This region includes Colorado, Utah, Wyoming, Montana, Idaho, Oregon and Washington—with major airports in cities like Seattle, Salt Lake City and Denver. Sprenger adds that Bozeman’s airport has four times the traffic of the average of cities with the same population size.

Airlines now offer direct flights to Bozeman from cities including New York, Los Angeles, Chicago, Dallas and Seattle, making access to Big Sky for destination visitors increasingly easy.  

There is plenty of Big Sky development still to come. According to Charity Fechter, planning director for Madison County, at the Yellowstone Club about 70 percent of the subdivision lots have been created, but Moonlight Basin is permitted for 1,651 total residential units, and has platted only an estimated 470 to date.

CrossHarbor Capital Partners’ locally formed subsidiary, Lone Mountain Land Company, is working to secure funding for a five-star Montage hotel in Spanish Peaks Mountain Club, according to CrossHarbor managing partner Matt Kidd, who believes it will happen this summer. The building would be more than 500,000 square feet when completed.

CrossHarbor co-founder and managing partner Sam Byrne has repeatedly told members of the media that high-end accommodations for tourists are needed to attract more attention and more business, and LMLC broke ground July 21 in Big Sky Town Center on the Wilson Hotel, a 129-unit Marriott Residence Inn that should open during the 2018-2019 ski season.

However, there are unsolved issues from the past and the major challenges include affordable housing, water and sewer rights, traffic issues, as well as development impacts on wildlife habitat and connectivity.

“How Big Sky grows is not just going to affect that community, but the entire northwest quadrant of the Greater Yellowstone Ecosystem,” said Dennis Glick of Future West, a Bozeman-based nonprofit that promotes sustainable community development. “The one thing in conservation that really applies to Big Sky is large-scale thought. It would be very shortsighted not to take significant steps to preserve these wildlife habitat areas. So far, the approach from Big Sky has been reactive, not proactive.”

Water is one thing that is non-negotiable in Big Sky. “Everyone needs clean water, and most people are willing to work for a solution,” says Bob Zimmer, the waters program coordinator for the nonprofit Greater Yellowstone Coalition. “But there is potential for a lot of growth in Big Sky.”

Ron Edwards, who was hired by the district 22 years ago, says that he estimates Big Sky will soon have to appeal to the Montana Department of Environmental Quality for new wells. “At the current pace of construction, we will have to get new water in about five years,” Edwards said.

However, wastewater is the biggest issue in the area according to Edwards. Treated wastewater is recycled and used to irrigate golf courses, but there is resistance to using more of it for snowmaking purposes. Edwards suggests if that attitude prevails, someday treated effluent will have to be released into the Gallatin River. According to Zimmer, however, if that happened, “public opinion would come unglued.”

The Yellowstone Club was served a wastewater-related public relations and environmental disaster in March 2016, when approximately 30 million gallons of treated effluent leaked out of a broken pipe in a storage pond and eventually reached the Gallatin River. The spill originated with a design flaw in the wastewater storage pond, built in the early days of the club.

Affordable housing is another hot button issue and one that Big Sky shares with most resort communities, as well as a growing number of cities around the nation that are seeing increasing inequality between homeowners and renters.

A bill to allow local voters to decide on an up to 1-percent increase of the resort tax was brought to the state legislature this spring, but failed in a 25-25 tie in the Senate. In Big Sky, the additional money was to be earmarked for affordable housing projects, and it bitterly divided the town.

New residential properties under construction in Big Sky Town Center, March 2017. In one new development nearby, three-bedroom units rent from $2,400 to $2,600. PHOTO BY WES OVERVOLD

For now, the Yellowstone Club offers employee housing in Gallatin Gateway, 30 miles north toward Bozeman, and 12 miles south at 320 Ranch in the winter, as well as 10 condos in Big Sky. “This is definitely a priority for us and we continue to seek options to enhance employee housing,” wrote Yellowstone Club Vice President and General Manager Hans Williamson in an email.

Without providing specifics on any future projects, Williamson noted that with their current staff numbers, the club is able to offer housing to 34 percent of its winter seasonal work force, and 44 percent of its summer staff.

The Yellowstone Club is currently building a 550,000-square-foot base area project called The Village, which will lead to more jobs, and that is causing some in the community to demand that the club do more to house people closer to the club and help alleviate commuter traffic. While there are no regulations requiring the club to do so, it’s not helping community relations and concern over housing and growth, according to some residents.

“I think there is a huge amount of resentment from a lot of people down here, that [the private clubs] refuse to use any of their land to solve the problem,” says Steve Johnson, a resident who sits on the zoning advisory committee, and fire and park district boards. “This housing issue [is partly] a problem of their creation, and they want resort tax to pay for it, or the counties. You have 20,000-square-foot mansions and a servant class. I’m not sure it’s sustainable.

“Part of the solution to the problem could be a commitment of land,” Johnson added. “Why can’t they do it with their land? They’re looking for additional resources to solve their problem.”

“We’ve created a list of tools in zoning to allow for employee housing,” said Gallatin County Planner Tim Skop. “But the developers don’t use them, and we don’t force them. If the markets solve everything, maybe it’ll solve this too, because the best food isn’t good if no one is there to serve it.”

Boyne, for its part, says it’s tackling the affordable housing problem with renewed investment as part of its recently announced “Big Sky 2025,” an estimated $150 million, decade-long project that includes new lifts, on-mountain dining, lodging and housing at Big Sky Resort.

The resort already supplies some 450 employees with housing, in dorms and apartments, and plans to increase the number of seasonal workforce beds by an additional 200 in a phased construction plan, according to Brian Wheeler, the resort’s director of real estate and development. A remodel of the former Black Bear Bar and Grill—now called the Mountain Lodge—added 42 beds last fall and a remodel of the Golden Eagle in the Meadow Village is underway, which will add approximately 35 beds.

Both the meadow and mountain employee housing campuses will see new buildings constructed in the future, according to Wheeler.

“We have a lot of projects kicking off to get ahead of this issue,” said Stephen Kircher, president of Boyne Resorts. “We want to reduce reliance on bussing, or leases, and if an employee wants to live in Big Sky, we want to help them do it.”

Reporting was contributed by EBS Managing Editor Tyler Allen.

Read the fifth installment in this series “A ship without a captain?” in the Aug. 18 edition of EBS.