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HomeMy WebLinkAboutWater Adequacy Petition Presentation CombinedTuesday, April 22, 2025 Water Adequacy Petition Discussion •The Initiative conflicts with various City policies including the Community Plan •The Initiative is unnecessary to address the City’s water supply •The Initiative will lead to higher housing prices •The Initiative will not lead to the production of additional affordable housing Water Adequacy Petition Discussion Tuesday, April 22, 2025 Water Adequacy Petition Discussion Tuesday, April 22, 2025 State Legal Framework TITLE 76. LAND RESOURCES AND USE •CHAPTER 1. PLANNING BOARDS •CHAPTER 2. PLANNING AND ZONING •CHAPTER 3. LOCAL REGULATION OF SUBDIVISIONS •CHAPTER 4. STATE REGULATION OF SUBDIVISIONS •CHAPTER 5. FLOOD PLAIN AND FLOODWAY MANAGEMENT •CHAPTER 8. BUILDINGS FOR LEASE OR RENT •CHAPTER 25. MONTANA LAND USE PLANNING ACT Water Adequacy Petition Discussion Tuesday, April 22, 2025 State Legal Framework 76-25-206.Housing.(1) A local governing body shall identify and analyze existing and projected housing needs for the projected population of the jurisdiction and provide regulations that allow for the rehabilitation, improvement, or development of the number of housing units needed,… 76-25-207.Local services and facilities.(1) The land use plan must: (d) determine the existing capacity, existing deficiencies, planned expansion, and anticipated levels of utility services necessary to serve the projected population in the jurisdiction, including water,… Jurisdictional Framework Water Adequacy Petition Discussion Tuesday, April 22, 2025 Water Adequacy Petition Discussion Tuesday, April 22, 2025 Context in Planning Area •Total planning area ~70 sq. mi. •Area in Bozeman ~ 21.7 sq. mi. •92% of parcels outside of Bozeman are <=20 acres Water Adequacy Petition Discussion Tuesday, April 22, 2025 Could the City choose to not grow anymore? If we choose not to grow what is likely to happen? Is the outcome better or worse? If we are to grow how to do so? Water Adequacy Petition Discussion Tuesday, April 22, 2025 -10% 0% 10% 20% 30% 40% 50% 60% 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000 2010 2020 2030 Percentage of Growth per Decade per US Census Water Adequacy Petition Discussion Tuesday, April 22, 2025 Water Adequacy Petition Discussion Tuesday, April 22, 2025 Future Land Use Map •Not time limited •Not tied to a particular population or growth rate •Adopted land use plans have encouraged development within the city and on municipal services since 1983. Water Adequacy Petition Discussion Tuesday, April 22, 2025 Geographic Scope of Jurisdiction •Bozeman only regulates inside its city limits •All other areas regulated by Gallatin County or another municipality •Only after annexation are the City’s regulations applicable Water Adequacy Petition Discussion Tuesday, April 22, 2025 Adopted Plans • Bozeman Creek Enhancement Plan – 2012 • Climate Action Plan – 2020 • Community Housing Action Plan – 2020 • Community Transportation Safety Plan – 2013 • Downtown Strategic Parking Management Plan – 2016 • Drought Management Plan – 2022 • Economic Vitality Strategy – 2023 • Fire and EMS Master Plan – 2017 • Five Year Consolidated Housing Plan - 2024 • Gallatin County Hazard Mitigation Plan and Community Wildfire Protection Plan – 2019 • Gallatin Valley Sensitive Lands Protection Plan – 2023 • Housing Needs Assessment – 2019 • Integrated Water Resources Plan - 2013 • Integrated Water Resources Implementation Plan – 2013 • Midtown Action Plan – 2017 • Neighborhood Conservation Overlay District (NCOD) – 2019 • Parks, Recreation, and Active Transportation Plan – 2023 • Stormwater Facilities Plan – 2025 • Stormwater Management Plan – 2019 • Transportation Master Plan – 2017 • Triangle Community Plan – 2020 • Urban Forestry Management Plan – 2016 • Wastewater Collection Facilities Plan Update – 2015 • Water Conservation and Efficiency Plan – 2023 • Water Facility Plan Update – 2017 Water Adequacy Petition Discussion Tuesday, April 22, 2025 Growth Policy Implications Potentially Advances R-1.3 Be inclusive: prioritize broad consultation to create a sense of shared ownership in decision making. Potentially Conflicts R-2.4 Social Equity: Provide solutions that are inclusive with consideration to populations that are often most fragile and vulnerable to sudden impacts. R-2.5 Technical Soundness: Identify solutions that reflect best practices that have been tested and proven to work in similar local or regional contexts. DCD-1.2 Remove regulatory barriers to infill. DCD-1.13 Pursue acquisition and development of diverse water sources and resources. EPO-3.5 Update land development standards to implement the Integrated Water Resources Plan. RC-1.1 Consider regional impacts when making policy decisions affecting areas outside the City. RC-1.5 Implement the Triangle Community Plan in coordination between Bozeman, Belgrade, and Gallatin County. RC-3.1 Work with Gallatin County to create compact, contiguous development and infill to achieve an efficient use of land and infrastructure, reducing sprawl and preserving open space, agricultural lands, wildlife habitat, and water resources. RC-3.4 Encourage annexation of land adjacent to the City prior to development and encourage annexation of wholly surrounded areas. Goal RC-4: Ensure that all City actions support continued development of the City, consistent with its adopted Plans and standards. Water Adequacy Petition Discussion Tuesday, April 22, 2025 Water Adequacy Petition Discussion Tuesday, April 22, 2025 Water Adequacy Petition Discussion Tuesday, April 22, 2025 Conclusion Concerns are: Inconsistent with state law planning requirements Inconsistent with adopted land use and facility plans Growth pushed outside of city jurisdiction and standards Reduced ability to provide housing in a manner consistent with community priorities Water Adequacy Petition Discussion Tuesday, April 22, 2025 Key Topics •Current Water Adequacy Policy •Current Water Supply Snapshot •Realized and Projected Supply Expansion •Citizen Proposed Water Adequacy Policy Amendment •Impacts of Citizen Proposed Water Adequacy Amendment Water Adequacy Petition Discussion Tuesday, April 22, 2025 Water Adequacy Petition Discussion Tuesday, April 22, 2025 Current Water Adequacy •Current Policy went into effect in 1984 •Requires that projected water demand of new development be offset by one or more of these options: •Reduce demand with water conservation systems and techniques •Pay cash-in-lieu of water rights and City acquires the water rights •Bring useable water rights to the City Water Adequacy Petition Discussion Tuesday, April 22, 2025 Water Supply Tracking Tool •Bozeman has a Water Supply & Optimization Tool that allows the City to proactively forecast and manage its water supplies. This tool tracks: •Current water demands •Projected water demands for new projects, including projected savings from water conservation systems and techniques associated with projects •Current water supply Water Adequacy Petition Discussion Tuesday, April 22, 2025 Current Water Supply Snapshot Gallons per Capita Day Water Use Bozeman = 114 GPCD Others in Montana = 163 GPCD (average) Comparable Cities = Boulder, CO: 133 GPCD Denver, CO: 140 GPCD Bend, OR: 157 GPCD Gallons per Household Day Water Use Bozeman: 188 GPHD National average: 254 GPHD Arid Western states: 314 GPHD City has the experts to efficiently develop water supply, water rights, and conservation to stay in front of development demands Development within Bozeman is most Water Sustainable Percentage of Total Basin Surface Water Rights in Bozeman Municipal Use Water Adequacy Petition Discussion Tuesday, April 22, 2025 Approx Bozeman use of Surface Water Rights in Gallatin Valley Basin 19 cfs or 0.1% of Total Total Surface Water Rights in Gallatin Valley Basin 15,000 cfs (cubic-feet-per-second) Water Adequacy Petition Discussion Tuesday, April 22, 2025 Hyalite Creek Watersh ed 40%Bozeman Creek Waters… Lyman Spring 20% Current Water Supply Snapshot Water Adequacy Petition Discussion Tuesday, April 22, 2025 How much water does Bozeman have today? Legal Water Rights af/yr Reliable Supply af/yr Today’s Total Supply 16,517 11,920 2024 Actual Use 7,100 (43%) 7,100 (60%) •af/yr = acre-feet/year •1 acre-foot of water is approximately 1-foot of water over an entire football field. •1 acre-foot of water supplies approx 4 single family homes or 8 condo/apartment units per year. •Reliable Supply is the amount available via the City’s existing rights reduced by the impact of a 1 in 5 year drought (similar to what occurred in 2021) How much water does Bozeman have after accounting for currently approved, but not yet built development? Water Adequacy Petition Discussion Tuesday, April 22, 2025 Legal Water Rights (af/yr)Reliable Supply af/yr Total Supply 16,517 11,920 2024 Actual Use 7,110 (43%)60% 2024 Actual Use, including Approved Dev of 993 af/yr 8,103 (49%)68% 2025 Unused Water Rights 8,423 (51%)3,814 (32%) •These projections are conservative and do not account for additional water supply development included in Conservation and the Capital Improvement Plan over next 5 years. Realized and Projected Supply Expansion 26 Projected Supply Expansion The projected additional volume of water that will be realized through supply projects outlined in the next 5-year CIP is 1,575 AF. Realized Supply Expansion Through supply development projects, the City has realized 1,334 AF of water since 2013. Citizen Proposed Water Adequacy Policy Amendment 27 Citizen Proposed Water Adequacy Policy Amendment Language – 1st part Citizen Proposed Water Adequacy Policy Amendment Language – 1st part Citizen Proposed Water Adequacy Policy Amendment Language – 2nd Part Citizen Proposed Water Adequacy Policy Amendment Language – 2nd Part Impacts of Citizen Proposed Water Adequacy Policy Amendment 32 Impacts of Citizen Proposed Water Adequacy Policy Amendment •Time for developers to obtain useable water rights = 3-8 years without cash-in-lieu of water rights option. Water rights must be developed in conjunction with water supply projects. •Would developers provide a well for each project that the City would then own/maintain? This is highly inefficient. Much more efficient to develop water supplies that serve larger areas of City, not just one development. Impacts of Citizen Proposed Water Adequacy Policy Amendment •Pressure on Bozeman’s water supply, and other infrastructure systems, will continue to increase as commuters will still come to Bozeman as MSU and other services, such as healthcare continue to expand. •Water demand less efficient outside Bozeman. Overall water system impact in Gallatin Valley be heavier impact from residential uses. Impacts of Citizen Proposed Water Adequacy Policy Amendment •Eliminates water conservation incentives for new development o Implementing/installing any water efficient processes, systems, fixtures, or outdoor landscaping within an existing development (‘offsite offsets’) •Offsite offset projects must save water in perpetuity through the installation of water efficient processes/fixtures. I.e.- fixing a leak would not qualify as an offsite offset. •Offsite offsets are a win-win-win because they allow for water-neutral growth. 1)The applicant can meet water adequacy requirements and gain approval 2)Existing property owner(s) benefit from zero-cost efficiency improvements, resulting in lower utility costs long-term and improved performance of processes/fixtures etc. 3)The City can accommodate growth without impacts to its water supply Unintended Impacts of Citizen Proposed Water Adequacy Policy Amendment •May create an unfavorable marketplace from which to buy reasonably priced water rights •Will affect City budgets and City ability to meet citizen water service needs cost effectively •Developers will not be able to meet the requirements to use the cash-in-lieu program - City Economic Development will provide financial discussion Income to Afford the Median Home 0% 50% 100% 150% 200% 250% $0 $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 $700,000 $800,000 $900,000 2016 2017 2018 2019 2020 2021 2022 2023 2024 Income Required to Afford the Median Home Median Home Price 100% AMI for Family of 4 Required Annual Income % AMI for Family of 4 Bozeman 2016 2017 2018 2019 2020 2021 2022 2023 2024 Median Home Price $359,500 $381,500 $427,500 $460,000 $540,000 $700,000 $755,000 $767,500 $784,500 100% AMI for Family of 4 $74,200 $71,000 $81,200 $90,300 $90,400 $88,900 $104,700 126,400 109,000 Required Annual Income $81,529 $88,594 $103,228 $104,448 $112,290 $142,147 $201,902 $219,205 $227,162 % AMI for Family of 4 110%125%127%116%124%160%183%173%208% g jAffordable Housing Action Plan 2019 Population and Housing Growth EPS 2024 Deliveries & Vacancy Average Monthly Rent Rents Lag Deliveries Home Ownership Income Gap For-sale Home Prices and Land Cost Average Lot Prices - Gallatin Association of REALTORS, Single Family Homes 2020 $145,861 2021 $324,750 2022 $396,000 2023 $311,873 2024 $256,479Average Sales Prices - Gallatin Association of REALTORS, Single Family Homes 2020 $784,017 2021 $905,011 2022 $865,114 2023 $886,845 2024 $879,158 Feasibility of Affordable For-Sale Homes Where Does Housing Come From? Image Credit: Priceonomics Where Do Housing Costs Come From? •The cost of inputs drives housing costs. •Demand increases the cost of inputs. Housing Cost Inputs •Land •Lumber •Labor •Leverage •Water rights are essential for housing, but not a major cost driver No Affordability Without Subsidy 7th and Aspen Project How to Pick an Affordability Target Root Policy Research 2021 Root Policy Research 2024 Feasibility of WARD Affordability Target “Bozeman faces a severe lack of affordable housing. Therefore,the requirement of 33%affordable units to satisfy the city’s water adequacy requirement is justified to begin to combat this at a faster rate than 5%,15%,or 20%. Additionally, this figure challenges developers to include more affordable housing to receive the benefit of CILWR, the main way for developers to get sufficient water access to create more residential developments.” affordability target does not work? •City Experience with Inclusionary Zoning o 10% affordability requirement o 16 units o Most developers paid cash-in-lieu Regional Housing Market Demand Will WARD Cause Sprawl? Source: U.S. Census, On the Map, 2022 Future Tax Revenue and Tax Rates? •Newly taxable value spreads the tax base over more properties •Tax generation from existing properties are capped and do not keep up with inflation. •Increased home costs and property values may result in higher taxes. What are the effects of WARD on Economic Development? •Housing is essential for attracting and retaining talent •Construction industry represented 6,413 of 59,071 Gallatin County jobs in 2020 Summary of WARD Impacts •May increase taxes •May inhibit talent retention and attraction •May promote sprawl •May increase home prices by constraining supply •May increase rents by constraining supply •The Initiative conflicts with various City policies including the Community Plan •The Initiative is unnecessary to address the City’s water supply •The Initiative will lead to higher housing prices •The Initiative will not lead to the production of additional affordable housing Water Adequacy Petition Discussion Tuesday, April 22, 2025 Jurisdictional Framework Gallatin County future land use map