City affordable housing program becomes voluntary

Whitefish’s affordable workforce housing program is moving from mandatory to voluntary.

City Council last week approved the changes to make the Legacy Homes Program available to developers that commit 10% of housing in new developments to affordable housing. In exchange for units, developers can take advantage of certain incentives.

The city’s Legacy Homes Program had utilized inclusionary zoning to require most new developments to provide a certain percentage of housing as deed-restricted affordable housing. But a bill signed into law this spring by Montana Gov. Greg Gianforte made inclusionary zoning illegal.

“Sadly we’re having to do this,” Councilor Andy Feury said. “It had taken us two years of work to get to what was a mandatory program and now we’re turning it into a voluntary program.”

Acknowledging that the program could use some adjustments based upon recent suggestions, Feury said the city needed to get the program running again and then figure out changes.

“We were sitting here with nothing,” Feury said. “This is a stopgap measure until we can come up with something better.”

Council in June at a work session decided it had little choice, but to make the program available as a voluntary means of creating affordable housing.

The mandatory program adopted in 2019 had required that 20% of all housing be deed-restricted as affordable. The new iteration of the program allows a developer to provide 10% of housing in a project as deed-restricted affordable or pay the fee-in-lieu and subsequently take advantage of a list of incentives.

During public comment, Giuseppe Caltabiano, who is running for City Council, suggested that the city consider revamping the program that would create a tier system where a developer who provides 10% affordable housing could use certain incentives while those that might do 30% or 60% of a project as affordable could take advantage of even more incentives.

The program outlines standards for the affordable housing units including that they be a mix of bedroom types, meet certain quality standards and meet minimum square footage requirements. Options are also available to build off site, pay a cash in-lieu-of fee or purchase units to be deed-restricted.

In terms of incentives, for multi-family construction projects, developers can use a 20% reduction in parking, 10% increase in building height, 10% increase in lot coverage and a 20% increase in allowed density.

For subdivision projects, incentives would include a 20% reduction in lot size and width, a 10% increase in lot coverage and a 20% increase in density. For planned unit developments, incentives from one or the other of those lists could be used and they could also qualify for a density bonus.

The Legacy Homes Program came as a result of the city’s 2017 Strategic Housing Plan that identified inclusionary zoning as a tool to build affordable housing by requiring a certain percentage of homes to be deed-restricted for long-term affordability.

A 2016 housing needs assessment found that Whitefish needed to add almost 1,000 new units of housing by the end of 2020 to keep up with demand. The city is planning to do an update of the assessment.