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HomeMy WebLinkAbout08-20-24 Public Comment - S. Hall - AHO Public Comment 8_20_2024From:Clay Hall To:Bozeman Public Comment Subject:[EXTERNAL]AHO Public Comment 8/20/2024 Date:Sunday, August 18, 2024 8:38:47 AM CAUTION: This email originated from outside of the organization. Do not click links or open attachments unless you recognize the sender and know the content is safe. Without more affordable housing, the people in Bozeman who keep the wheels turning, and make this a desirable and livable city, can no longer afford to live here. This is an existential issue that will only worsen over time if left unmanaged. It is easy to visualize the magnitude of our future problems by seeing what is already occurring in places like Aspen CO, Jackson Hole WY, Steamboat Springs CO, and other cities as well. While it’s not too late for us to turn the tide, the inflection point of no return is near. Insufficient affordable housing is a national problem for sure, but it is especially problematic in fast growing areas like Bozeman, where real estate values have increased well beyond the rate of inflation. Since 2020, Bozeman has not only seen some of the most rapid home price inflation in the state, but also in the nation as well. Bozeman is not however the only Montana city with inadequate affordable housing. Whitefish, Kalispell, Billings, Missoula, and Helena are also dealing with this problem to varying degrees, which makes them ideal candidates to partner with Bozeman to lobby the state to help solve the problem. One way to address the lack of affordable housing is for the city of Bozeman (and the other Montana cities with insufficient affordable housing) to relax zoning restrictions around the building of accessory dwelling units (ADUs) so that it becomes possible for existing homeowners to build detached, small, living quarters on their existing residential lots. Because these new ADUs would be small, and since they would utilize existing infrastructure and space, they could be offered for rent at affordable prices to low income people who want to work and live in Bozeman. While this change alone could make a difference, these rentals could be even more affordable if Bozeman and other cities in Montana with affordable housing shortages, joined together and convinced the state to offer existing property owners a financial incentive to build ADU rental units on their properties and to rent them at below-market rates. This would happen if the state would allow homeowners to build small rental ADUs on their properties for low income families to rent at below market prices and also agreed to certain rent control pricing for future years. The incentive for homeowners to build these small ADUs would be an ability to invest in their properties (thereby increasing property values) without triggering a corresponding increase in their existing assessed home values and personal property taxes. If homeowners subsequently stoped renting these ADUs at below market rates to low income families, the state would have the ability to increase the property values and therefore the personal property taxes Bozeman should lead the effort by partnering with Whitefish, Kalispell, Billings, Missoula, and Helena, to persuade the state legislature to provide such relief to existing homeowners. The combination of relaxed zoning and personal property tax relief would be a powerful tool but relaxed zoning alone can be a difference maker. Some US cities, like Seattle, have seen positive impacts from relaxing zoning regulations. In Seattle, ADU construction surged 250% after relaxing ADU zoning regulations in 2019, without the impact of concurrent personal property tax relief. Nearly 1,000 ADU permits were granted in 2022, compared to just 280 in 2019. In 2022, more ADUs were built than detached single-family homes for the first time in Seattle's history. Relaxing ADU zoning rules allowed for new, detached, small, single family units built on the properties of existing homes. These new units provided smaller and less expensive options for many residents who would have otherwise needed to move out of the area to more affordable areas. Other cities, such as Washington D.C. and Minneapolis have had similar experiences. Relaxing ADU zoning regulations alone can help address housing shortages, without necessitating major redevelopment. Bozeman and other Montana cities are ideally suited for this type of solution since the average residential yard size in Montana is larger than most other states. While the average yard size for new construction in the US is 13,896 square feet, Bozeman’s average yard size is 17,340 square feet, or 25% larger. Larger yard sizes make it possible to accommodate ADUs without creating unwanted overcrowding and congestion. Cities in Montana have broad authority to regulate zoning within their jurisdictions. But, the State of Montana determines the overall framework for appraising and valuing properties for personal property tax purposes. While relaxed zoning alone can make a positive impact the combination of city zoning relaxation and state personal property tax incentives would be transformational. Clay Hall C-406.599.1250 E- claybhall@gmail.com