EUREKA SPRINGS, Ark.-Some restaurant owners in Eureka Springs say the rising cost of housing in the tourist city is leading to a shortage of employees because the service workers can't afford the rent.
"People end up having to live on the outskirts," said Bobbi Bins, an employee of DeVito's Restaurant. "There's either nothing for rent, nothing in town or nothing affordable."
Apartments in downtown Eureka Springs may be advertised at $650 a month, Bins, who lives on the outskirts of town told the Arkansas Democrat-Gazette, but costs that include utilities and parking drive the prices to near $1,000 per month.
Nine miles north in Holiday Island, apartments go for about half the cost of downtown Eureka Springs, but many service-sector employees move to Eureka Springs for the downtown that includes artsy neighbors and 19th-century architecture.
Kelli Zumwalt, a co-owner of the seasonal K.J.'s Caribe, said she wasn't sure she would be able to open this spring, but eventually found the workers needed.
"It's a serious deal," she said. "Affordable housing is the No. 1 issue here. We don't have affordable housing."
City Alderman James DeVito, who also owns DeVito's Restaurant, said the workers make more than minimum wage, but many earn most of their money through tips and the wait staff usually tip the cooks, bartenders and sometimes the dishwashers.
"It is a crisis in my opinion in a service-sector town when you don't have affordable housing," said DeVito, adding that he believes part of the problem is the conversion of rental properties to bed-and-breakfast inns, thus reducing the available rental housing.
DeVito said he will propose a moratorium on new bed-and-breakfast establishments in residential areas at Monday's City Council meeting.
Charles Cross, president and CEO of Cornerstone Bank in Eureka Springs, said the cost to buy and maintain buildings downtown means rents have to be at a certain level to make them profitable.
"It's hard to buy a building downtown and have the space be affordable for the waiters and waitresses of Eureka Springs," said Cross.
Cross said his family partnership owns about 10 apartments in downtown Eureka Springs with rents that vary from $400 to $750 a month, but said vacancies are rare.
"Demand is pretty solid," Cross said.