Rural counties compete for new business and industry - then find new workers can't afford to live in their gentrifying communities.

Spiraling city housing costs push workers into ever more distant suburbs - a phenomenow known as "Drive until you qualify" - thereby defeating the state Growth Management Act's goal of containing urban-level development in cities.

Affluent retirees and people who can afford second homes move into quaint small communities, driving up housing costs and demanding services that shrinking small-town budgets can't afford.

Those are some of the observations shared Wednesday at a session on housing affordability during the Washington State Association of Counties' annual convention at the Hilton Vancouver Washington.

Skamania County Commissioner Paul Pearce recounted the challenges facing his county of 11,000, where 60 percent of the work force travels outside the county for work. The county is actively recruiting new jobs, he said, but Skamania County's median household income of $40,216 is more than $35,000 shy of what's required to buy the median-priced house.

"Our cops, road workers and service workers can't find anyplace to live," he said.

The situation will worsen if the Confederated Tribes of the Warm Springs Indian Reservation succeeds in its effort to site a large new casino complex in Cascade Locks, Ore., just across the Columbia River from Stevenson, Pearce said.

"It will employ 1,200 people," he said. "They are already planning to bus people from Portland because there is no place for them to live."

Paul Carson, regional homelessness coordinator for the U.S. Department of Housing and Urban Development, encouraged counties to consider federal programs designed to end homelessness as they plan for meeting their housing needs.

The most successful projects not only meet a pressing need but are attractively designed to blend with surrounding neighborhoods, he said.

In Oregon's coastal Lincoln County, 40 percent of all houses are second homes, driving up the cost of housing for longtime residents, Carson said. When the county convened a conference to discuss the problem, he said, "45 people came out from under a bridge with a petition that said, 'Please help us.' "

Kim Herman, executive director of the Washington State Housing Finance Commission, described programs his agency offers to help first-time buyers with down payments and assist nonprofit organizations in building housing for the elderly and low-income families.

Affordable senior housing will be a critical issue as Washington's 65-and-older population increases from 700,000 to 1.2 million over the next 13 years, he said.

Washington now ranks seventh in the nation in housing costs, and the Seattle area ranks eighth-highest among U.S. cities, Herman said.

"Most people haven't come to the recognition that we're in the same league with Boston, Washington, D.C., and San Francisco," he said. "We have an expensive state."