HomeMy WebLinkAboutG3 Workforce Housing Commission Memorandum
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REPORT TO: Honorable Mayor and City Commission
FROM: Andrew Epple, Planning Director
Chris Kukulski, City Manager
SUBJECT: Workforce Housing Text Amendment, #Z-06152
MEETING DATE: Monday, August 7, 2006
BACKGROUND: The City Commission directed staff to draft an ordinance to show how the
CAHAB proposal from spring 2006 for affordable housing might be implemented. The draft has
been considered at public hearing by the Planning Board and Zoning Commission.
Two primary elements must be addressed in any development of a regulation by the City. Can
the regulation be done and should it be done. Public testimony has been received primarily on
the question of should the draft proposal be carried out.
Neither the Planning Board nor the Zoning Commission recommended adoption of the proposal
as originally presented. Ten material changes to the draft were recommended. The Board and
Commission also recommended that further consideration of the topic is necessary after
inclusion of the recommendations. The possibility of utilizing a task force for this process was
discussed. The minutes and resolutions reflecting the Planning Board and Zoning Commission
discussion are attached.
The City Commission initially considered the recommendation from the Planning Board and
Zoning Commission at their meeting on July 31st. The Commission decided to incorporate
several of the recommendations and some additional items. A draft of the proposal indicating
where those previous decisions to incorporate changes would be applicable has been prepared
and is attached. Full revision of the text has not been undertaken. The City Commission also
indicated a desire to have a task force consider the proposal.
UNRESOLVED ISSUES:
1) Legal adequacy of the proposal —currently under review by the City Attorney's office
2) Is the draft proposal an appropriate means to address issues of workforce housing?
3) How would the success of this program be measured?
i) Number of dwellings constructed
ii) Percentage of housing available
iii) number of persons served
4) Who administers the on-going responsibilities over the long term?
5) How are administrative costs to be funded?
6) Additional items incorporated into the public hearing draft by the Commission on July 31st
a) Exclude from the calculation for the number of required workforce housing units any
units resulting from a density bonus
Report compiled on August 2, 2006
Commission Memorandum
b) Allow opportunities for additional forms of compliance with the requirements including
banking of units through agreements with other developers.
c) Consideration of an affordability period to extend beyond 10 years.
7) Task force final composition and membership appointment.
8) If the Commission chooses to remove the RSL requirements from Title 18 is it the intention
to lift the requirement from those subdivisions already approved?
9) Recommended revisions from Planning Board and Zoning Commission. Those indicated
with an asterisk were not directed to move forward by the City Commission at the July 31S`
meeting.
a) Reduce percentage of required cost limited units from 25% to 10%
b) *Raise threshold of participation from 5 dwellings to 10 dwellings
c) *Provisions for sustained affordability to allow full recovery of appreciation for that
portion of the home which the person has individually paid for and recoupment of the
subsidized portion back into the workforce housing program
d) Construction of workforce units to be proportional to that of market rate homes, i.e. nine
market rate per one workforce unit
e) Review of proposed workforce housing implementation plans to stay within existing
subdivision review process, eliminate additional review requirements
f) Minimum construction standards should focus on safety and adequacy, not replication of
the market rate housing
g) A review of the program should be required 4 years after adoption and periodically
thereafter
h) Options for alternate compliance should be provided to enable creativity in addressing
housing issues, including cash-in-lieu
i) Cost of screening potential purchasers should not be borne by developer
j) Retain the existing Restricted Size Lot and Restricted Size Unit requirements, Sections
3&4 of the draft proposal.
RECOMMENDATION: Conduct public hearing and give direction on unresolved issues.
FISCAL EFFECTS: Costs can not be quantified until the Commission gives additional
direction on policy. Some expense will occur due to need to administer the program, including
screening of participants and on-going monitoring.
ALTERNATIVES: As suggested by the City Commission.
Respectfully submitted,
G
Andrew tj5ple, Planning Director Chris Kukulski, City Manager
Report compiled on August 2, 2006
Commission Memorandum
Attachments: Planning Board and Zoning Commission minutes and resolutions
Staff Report
Responses to City Commission questions from July 31, 2006
Status of Restricted Size Lots —applicable subdivisions, numbers, constructed
Existing affordable housing supportive policies, programs, and regulations
Draft proposal showing Commission direction for revisions
Commission Resolution 3630—Affordable Housing Strategies
Received public comment
Report compiled on August 2, 2006
Workforce Housing Planning Board Resolution
RESOLUTION NO. Z-06152
RESOLUTION OF THE CITY OF BOZEMAN PLANNING BOARD NOT
RECOMMENDING APPROVAL AND RECOMMENDING CHANGES TO A
PROPOSED AMENDMENT TO TITLE 18, UNIFIED DEVELOPMENT ORDINANCE,
CITY OF BOZEMAN MUNICIPAL CODE.
WHEREAS, the City of Bozeman has adopted a growt .policy pursuant to 76-1-604,
MCA; and
WHEREAS, the City of Bozeman Planning Boa has%been created by Resolution of the
Bozeman City Commission as provided for in Title 76-1-101, M.C.A.; and
WHEREAS, a proposal regarding workforce hosing w ,sgbmitted as to the City
Commission; and
WHEREAS, the City Commission; sired to have a fosed community discussion on
the matter of workforce housing; and
WHEREAS, the City Commission directed the submitted proposal to be placed into a
form which would enable public discussion oft merits and fws; and
WHEREAS, > elrafted fog creates a new Title 16 in the Bozeman Municipal Code and
revises Title 18;and
WH� , because Vie; proposal' uild affect the Unified Development Ordinance,
,.
Title 18 B' IC, whid�"\ gulates"� bdivisions it was necessary for it to be properly submitted,
reviewed, and advertised, accordance with the procedures set forth in Chapter 18.68 of the
Bozeman Unified Develop,�i t Ordinance; and
WHEREAS, the proposal has been properly submitted, reviewed, and advertised in
accordance witheprocedurs set forth in Chapter 18.68 of the Bozeman Unified Development
Ordinance; and
WHEREAS, the City of Bozeman Zoning Commission and Planning Board held a joint
public hearing on Tuesday, July 18, 2006, to receive and review all written and oral testimony on
the request for a text amendment; and
WHEREAS, no written testimony was received prior to or at the public hearing; and
WHEREAS, 14 persons spoke at the public hearing with one in support, two neutral with
questions on the proposal, and 11 in opposition; and
WHEREAS, a motion to recommend approval of the proposed text amendment failed on
a vote of 4-5; and
WHEREAS, the City of Bozeman Planning Board after additional consideration of the
proposed amendment identified deficiencies in the proposed text amendment; and
NOW, THEREFORE, BE IT RESOLVED, that the City of Bozeman Planning Board, on a vote
of 6-2, recommends to the Bozeman City Commission that text amen application Z-06152
be revised and then given additional public consideration. Specific,° visions suggested are:
1) Reduce percentage of required cost limited units from 2517c, to %
2) Raise threshold of participation from 5 dwellings to 1 dwellings;`
3) Provisions for sustained affordability to allow full.,�,recovery of`,' preciation for that
portion of the home which the person has in$ividually paid for and pupment of the
subsidized portion back into the workforceA—i",ousing program
4) Construction of workforce units to be proporti6nal to that� market rate lbmes, i.e. nine
market rate per one workforce unit
5) Review of proposed workforce.,,housing implementation plans to stay within existing
subdivision review process, elimintadditional review"°equirements
6) Minimum construction standards should"",,focus on safety anal adequacy, not replication of
the market rate housing
7) A review of the program should be regred 4 years after adoption and periodically
thereafter
DATED THIS 18'h° AY,-,OF JULY2006 Resolution No. Z-06152
Andw C.Epple, Director JP Pomnichowski, President
City of Bozeman Department of City of Bozeman Planning Board
Planning and Community Development
MINUTES
THE CITY OF BOZEMAN PLANNING BOARD
TUESDAY, JULY 18, 2006
7:30 P.M.
ITEM 1. CALL TO ORDER AND ATTENDANCE
Planning Board President and Zoning Commission Chairman JP Pomnichowski called the meeting
to order at 7:30 p.m. and directed the secretary to record the attendance.
Board Members Present Staff Present Visitors Registere
JP Pomnichowski Andrew Epple, Planning and Community Tom Henesh
Erik Henyon Development Kanako Vance
Nathan Minnick Chris Saunders, Assistant Director, Mike Jarrett
Peter Harried Planning and Community Development Mary Martin
Randy Carpenter Kelly Marple, Recording Secretary Heidi Graf
Nicholas Lieb Julie Langaker
Dave Jarrett Gwenn Stokoe
Brian Caldwell Richard Reid
Caren Roberty Mare Boustead
Steve Kirchhoff Dani Karnp
Mike Hope Dennis Rowe
Edward Sypinski Jeremy Shea
Lyle Happel
Vicki DeBoer
Allan Lien
Rick Klein
Evan Schoepke
Marcia Youngman
ITEM 2. PUBLIC COMMENT (0-15 MINUTES)
{Limited to any public matter within the jurisdiction of the Planning Board and not
scheduled on this agenda. Three-minute time limit per speaker.}
Evan Schoepke, 1711 South I I th Avenue, distributed information to the Planning Board and stated
that he was a student at MSU who recently visited several cities in Europe as well as the city of Los
Angeles. Mr. Schoepke stated that from his travels he had learned some lessons on cities and observed
what worked and what didn't work. Mr. Schoepke went on to say that after a trip to Olympia,
Washington, he was impressed that they have bio-diesel buses, a diverse culture, a high level of activism,
and a sense of community and pedestrian culture. In regards to city planning, Mr. Schoepke stated that he
had found a book entitled"EcoCities" which he encouraged the Bozeman Planning Board members to
read because the book contained ideas on how to avoid sprawl, how to make more efficient communities
so less cars are used, and how to create thriving pedestrian communities.
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ITEM 3. MINUTES OF JULY 5'", 2006
President Pomnichowski called for corrections or additions to the minutes of July 5, 2006. The
minutes were approved and will stand as written.
ITEM 4. PROJECT REVIEW
Workforce Housing Text Amendment, #Z-06152—(Workforce Housing ZCA). A Text
Amendment Application to revise local development regulations to remove requirements from Title
18 for restricted size lots and units and to create requirements in a new Title 16, Housing for
provision of workforce housing(Saunders).
Chris Saunders presented the application and went over some of the stages the application has been
through. Planner Saunders described state laws which applied to this amendment,and stated that the
recommendation from staff is that a public hearing be held where the public could weigh in on this issue.
Applicant Mary Martin,member of Community Affordable Housing Board came forward and stated
that she was there to provide education regarding a workforce housing ordinance hearing being reviewed
this evening. Ms. Martin then did an introduction and history of affordable housing. Tracy Menuez went
over the draft highlights as previously handed out to members of the board. Another member of CAHAB,
Vicki DeBoer, then presented the benefits of homeownership and stated that she is also with AWARE, an
organization which assists people with disabilities. Ms. DeBoer stated that acquiring a home was a wealth-
building mechanism,then went over some of the alleged social benefits of homeownership.
President JP Pomnichowski then asked for questions of applicant from board members,hearing
none, she OPENED THE MEETING FOR PUBLIC COMMENT.
Mike Jarrett, 845 W. Arnold stepped up and stated that he was a homebuilder in Bozeman. Mr.
Jarrett continued by saying that he thinks this amendment is a bad decision because it stated that 25%of lots
in any subdivision need to be constructed before commercial lots,therefore the houses that he builds are too
expensive because he has to subordinate 25%. Mr. Jarrett then gave the example of Montgomery County,
where inclusionary houses were built,which resulted in having no more land to develop. Mr. Jarrett ended
by saying that he would probably build in areas other than Bozeman if this were to pass.
Mara Boustead,4239 E.Baseline Road, stated that she was a homeowner in this valley for 16 years,
she can't afford health insurance because taxes have tripled and can't afford to do maintenance on her
house. Ms.Boustead asked what would the procedure be if someone moves into these"affordable houses"
and then can't afford the maintenance, who will pay for the maintenance when they move out, and how can
we ensure that our taxes won't have to pay for this. Ms. Boustead also posed the question of why the
government should be responsible for people who cannot afford a house, and went on to say that the
statement by a CAHAB member stating that there is less teen pregnancy because of homeownership is
ridiculous. Ms. Boustead is planning on moving away from Bozeman because she cannot afford to live here
anymore, and ended by saying that when she got out of college, she had to work, save money, and buy her
own home, and if this amendment passes it will be enhancing entitlement by giving people homes.
Jeremy Shea, 176 Blue Roan Lane, stated that he was against inclusionary zoning because he
believes it is another form of subsidized housing, and will cause housing costs to go up across the board. He
added that it will force developers (if they choose to develop here)to increase lot costs,builders will
increase their costs, supply will dry up,prices will go up, and Bozeman will end up with more expensive
houses. He ended by saying that this will increase costs for everyone just to benefit a few, and that is
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basically a lottery system that won't work.
Terry Jones, residing at 22"d and 24"'Avenue located in HRDC Land Trust, stated that when she
moved to Bozeman she noted that the wages are low and cost of living is higher, and she had to take a cut in
pay. Terry Jones stated that she had bought a home through the HRDC in 1998, and if it were not for
affordable housing through the HRDC, she would not have been able to buy the home. She ended by stating
that this program is for people who work at wages well below the median.
Mr. Andrews,4202 Graf Street, stated that affordable housing is a noble cause which should
empower people to get a home using down payment matching programs or other methods, and that
inclusionary zoning is not the way to do it. Mr. Andrews encouraged tonight's presenters to do their
homework and see if this program is feasible. Mr. Andrews posed the question of whether it is right for a
small group of workers to pay for this,when it is a citywide need. Mr. Andrews suggested that big retailers
contribute to a fund to make a down payment matching fund, and raised the question of who is on the list to
receive this benefit, and how do we ensure that these people are working hard to earn what they receive. Mr.
Andrews stated that his wife is a realtor and he asked her to research how many homes are under currently
for sale in Bozeman for under$200,000, and she found 36 homes. Mr. Andrews asked if the percentage of
affordable homes for sale meet the existing need, and if we do determine we need affordable housing-this is
not the way to go about it.
Rick Klein, Bozeman, started by agreeing with what the mayor said earlier that day,this is
subsidized housing,not affordable housing. Mr. Klein would like to know what would happen if a
homeowner had a catastrophic happenstance,who pays for the housing then? He would also like to know
what happened to the money from big box stores, and asked if partnering with Habitat for Humanity had
been considered. Mr. Klein ended by stating that he is not opposed to affordable housing,be he does not
believe in having housing subsidies be on the backs of taxpayers.
Eric Rosette, 2200 W. Dickerson, #67, stated that he is a homebuilder in Bozeman, and if
inclusionary zoning does pass and the costs are passed down and lots become more expensive,he and his
company will not build here anymore and will go where affordable housing will be feasible,therefore, the
number of building permits in Bozeman will go down.
Jennifer Owens, 35 W. Clara Court, stated that she was a realtor with ERA Landmark and has
worked with large numbers of people eligible for affordable housing. Ms. Owens asked if the programs
available are being used, she believes that supply and demand will be raised, and that we should look at
programs already in place and use them instead of creating new bureaucracy.
Scott Teal, lives in Moab Utah, said that he would like to iterate what he has learned,he met a
foreign shopowner who told him that this country has invested in him, and these are not subsidies or
entitlements,but investments in people. He added that if people question the social value of home
ownership, they are deluded and he encourages this program to happen.
Dan Kamp, 24 Riverside Drive, stated that he was on two affordable housing task forces in the late
eighties and studied many of the same issues and concerns here tonight. Mr. Kamp said that he would like
to reiterate what he has learned, especially regarding affordable housing he has done for Dab Dabney,the
Comstock Apartments, and MSU. Mr. Kamp said that there are ways to maximize efficiency of construction
and supply affordable housing, and that he was a housing designer and two ways to create affordable
housing were to lower costs of materials, lessen designing, zoning, and planning requirements, and to
subsidize the units themselves. He stated that both of these avenues need to be explored completely, and if
we require the developer to subsidize part of the project, the project will be sold to higher income anyway
because they will be able to afford it. Mr. Kamp said that he is not opposed to subsidizing housing,but
there needs to be an equitable subsidy,you cant ask homebuilders to bear the cost,need the whole
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community to sign on for it and pay for it. Mr. Kamp continued by saying that we should not take one part
of the industry and make them pay for it, and that his cant be driven by one small group or a political entity,
we need a way that is equitable for everyone involved.
Richard Reid, 1802 W. Lincoln, stated that you should work for what you get, and if someone
stands around with their hand out,they are nothing but a beggar. Shouldn't ask City of Bozeman to pay for
your home, should go somewhere else where it is feasible to own a home.
Paul Bussey, lives elsewhere but his mail comes to Four Corners. Mr. Bussey said he would like to
know if cost offsets are in the proposed regulations, and if for each affordable unit that they provide,what is
the likelihood that given the current trends in density, those will be realized, and how much of a price
reduction will there be when there is increased density.
Kay Embry, 5 W. Belleview Circle, asked if we have an affordability housing issue, and said that we
are talking about subsidized housing. She added that the HRDC showed 99 units under$200,000, and if
people can't afford to live in the City Of Bozeman,there are options elsewhere such as Belgrade,Gallatin,
Four Corners, and Manhattan. Ms. Emery stated that she bought a house here after coming up with a
creative way to afford it, and that there are ways to improve wealth, it just takes time and work. She added
that home ownership is a privilege,not a right and she would like to define if we have an affordable housing
issue here. Ms. Emery added that to improve supply, developers will have to sell lots, and that the cost of
land is what is driving up price of housing. She stated that since the affordable housing has to be built first
on the lot, she is not sure what lending institution will lend money for that kind of set up. She would also
like other options to be explored, such as manufactured homes, incentives to builders to create whatever
affordable housing is,to lessen the burdens on the developers.
Hearing no more comment, President and Chairwoman JP Pomnichowski then CLOSED THE
PUBLIC COMMENT PORTION OF THE MEETING and returned discussion to board.
Ms. Pomnichowski invited staff or applicant to address the questions posed. Tracy Menuez stated
that regarding sprawl, according to studies, this program does not increase sprawl and the programmatic
questions that came up such as income guidelines and following a board of guidelines, the hope is that
through the use of this program we will be able to provide assistance at a deeper level. Tracy Menuez stated
that she teaches a homebuyer instruction course which teaches how to get down payment assistance and
how to manage money, and it is getting tighter to find a family earning less than the 20%median. She
added that if these homeowners miss a payment or can't maintain their house,they are a homeowner and if
they don't take care of it, they don't build equity, it is not a situation where the community is taxed. In
regards to what happened with the big box money, it was split, $100,000 to Mr. Dabney,the remainder was
split between the downtown connectivity,multi-family housing, '/2 for homeownership and down payment
assistance. Addressing the Habitat for Humanity question,because of costs they haven't been able to build
here since 1996. Addressing the question asking what is an affordable house, there is a range of prices to
build a strong community, the communities we compete with(Missoula) are more attractive because house
prices are higher here, so people make the choice to move there. There has been houses provided,but
unfortunately their prices increase because supply is low and demand is high.
President JP Pomnichowski asked Staff to address public questions. Director Andrew Epple stated
that he has worked with this issue for 15 years, as well as Mr. Kamp, and some of the strategies included
trying to reduce development costs, sideyard setbacks were changed to build on smaller lots, 25 feet to 15
feet for same reason,to build more efficiently. Street standards have changed, instead of 37 feet,can be as
little as 31, less asphalt, less street construction, all should reduce house costs. Director Epple described the
"Top of Pile Policy", where affordable housing projects go first. Park land can now be dedicated,higher
density projects were being penalized, and could not build out, once you achieve 12 units per acre, do not
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have to provide park land. Some of these issues they have been able to implement, and as Kate Embry
mentioned,the real issue is the price of land. The City Of Bozeman reduced its impact fees,but this did not
reflect a reduction in housing costs. The forces driving up the costs are numerous, and the steps they have
taken have not made an effect.
Chris Saunders described some of the tools to be used, such as the existing programs in place,
regulatory funds, subsidy-type funds,we act as a sponsor-type agency, so some tools are on the table. In
regards to the question of manufactured housing, the City Of Bozeman allows manufactured housing in any
and all districts,but there has not been a strong demand for those, from the subdivision side,there have been
a few in last few years,but not a lot. That is from the public side, question of density bonus, language as
presented in draft ordinance is essentially same in CAHAB proposal,unable to answer questions Mr. Bussey
asked. Mr. Saunders remarked that the questions were good ones, and in regards to the market result of
increased density question,he does not have an answer,market side would be able to answer.
Steve Kirchhoff stated that as City Commission liaison,in his view, as the commission stands,the
majority on the commission is in favor of moving some of this program forward. The goals of the
commission are not to establish a government handout system,just to acknowledge what is happening in the
City Of Bozeman. The university is looking at what people can afford and what is available, the belief of
commission is that people who make community work should have a decent shot. Fear in the industry that
this will cause sprawl, and people just barely in the market will have to absorb cost. We don't know for
certain what is going to happen.
Brian Caldwell stated that is an important community-wide issue, and the burden associated with
providing assistance should be paid for every member of community,not just one specific group. His
personal belief is that a real estate transfer tax(could be as low as a 1/4 point)would be beneficial, and if a
fund of 20 million dollars was generated, it would be borne by everyone and would limit the exaggerated
prices. The important part is that it needs to be equitable, it is an assistance to get affordable housing,but
the gain at any given period is that there is a payback into the program, if there is a desire in this community
to have affordable housing,he thinks its feasible. The way the current draft is written,the number is 25%,
10% of workforce housing is a realistic number, the term should be either in perpetuity or 30 years,in
regards to the gain on the sale of the home—he doesn't believe that it should involve the subsidy,the notion
of the windfall takes away from the pride in ownership that was talked about tonight. The issues of the
offsetting of the costs, densities are getting increasingly dense and there are incentives for this,need to
address that we have given the incentives away. The most important thing is the timing of the adoption of
the affordable housing units, size and scale should be established, if the neighborhood has a mix of units,
reasonable expectations of sizes should be met. The current mechanism for affordable housing is unjust,
should be borne of entire community.
Dave Jarrett stated emphatically that we do not have an affordable housing problem in Bozeman
Montana now to date,period. From January I"until today, he pulled the numbers, and 160 were sold at an
average price of$163,000,the median was $172,000. That's 156 that have sold this year. We are doing 300
per year. There are 30 on the market right now with a median price of$175,000, average$163,000, at least
20-30 % are 3 bedroom 2 bath units. Something that is driving this,maybe HRDC, is pushing this for a
reason or another. Mr. Jarrett would recommend that everybody on this board make a comment tonight,
think about the input from the public,look at history of inclusionary zoning in other states that have had this
and where it has worked and see what has truly happened in other communities. This will create a
tremendous problems for the city to make work. Let's go back and get some concrete comments regarding
this, such as what happens if someone misses a payment and defaults, what happens to that deed restriction,
who is going to buy it, is the bank going to take it back? There are many legal problems inside this
document that need to be considered.
Erik Henyon stated that he has a problem with the information from the Bay Area Economics
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presentation last night. Who pays for inclusionary units,builder may see an increase in lot price and small
returns, it is simple economics—price goes up, gets passed on to consumer,will be absorbed by homeowner.
In regards to the landowner bearing most of the cost,they are not economists, how do they know. Mr.
Henyon stated that they used California in many models, and California has the lowest home ownership in
the U.S. with 48%. Inclusionary zoning causes fewer homes to be built,Mr.Henyon went over several
slides presented the previous night and indicated where he found them to be factually incorrect. Mr. Henyon
stated that the UDO should be enough, it is unneeded to add another mandate. He stated that the numbers
look good on the slides,but facts show that they are incorrect. Mr. Henyon stated that this should not come
at the expense of the community, if building pen-nits go down, how much tax revenue are we going to lose in
the city,won't have the tax support to provide health and wellbeing. If we don't create revenue, it is
obvious that building permits are going to drop, and revenues will drop.
Caren Roberty stated that she would like to focus on the ordinance that Mr. Kirchhoff suggested.
Mike Hope asked what will happen if housing market goes in the other direction and prices start to
fall. He brought up the interest rate equation that is going on right now, and what happens if you can get
enough low interest, or a better source for down payments. Mr. Hope stated that he employs 100 people in
town, there is 2% unemployment, which has nothing to do with prices of homes in Bozeman. Mr. Hope said
that if someone wants to build a million dollar house and doesn't want to live around anybody,he should be
able to,he doesn't think you can force anyone to live in a multi-unit complex. He said that if you get people
into home ownership,but then cap it, then you are holding them back,not allowing people to get an
appreciation cycle and it is a huge hindrance,keeping people where they are at. Shouldn't tell people what
they are going to make,not the American way. Could start having losses,pent up demand and not enough
supply, can point fingers all over,huge amount of lots are becoming available,have to look into down
payment assistance programs,not opposed to 1%transfer tax, sprawl is a legitimate concern.
Mike Hope made the comment that they are going to pass this, and he doesn't think the city
commission is going to listen to a word we say here.
Edward Sypinski stated that we are responding to a real housing need here,what kind of character of
community are we trying to form here, and who do we want living in our community. Not sure this is a slam
dunk for city commission to pass this, and is it appropriate for city to have a affordable housing ordinance.
Maybe can do this on an ad hoc basis. He questioned what our charge/responsibility is as an advisory board.
Erik Henyon stated that the solutions are not in creating more regulations and mandates, what are
the real issues, affordability issues,wages are not commensurate, can we look at increasing wages, looking at
tax abatement for companies,but not this policy.
Mike Hope stated the thing that has increased the fastest in the hospitality industry is employee cost,
can't hire anybody at$8.00 per hour, can't raise prices fast enough to keep up with costs. Our profits as a
percentage have shrunk in last four years. Salaries have been driven up,we have created tons of service
industry jobs,need to figure out how to better drive people on the bottom side so they want to make more
money. 10% of his employees don't care if they work or not. How do you negotiate with a flawed policy,
need to throw this policy out and come up with better ideas by sitting down and coming up with a better
plan. Think we can agree on some ideas outside this policy.
Randy Carpenter thinks there are some problems, as Chris Saunders and Andrew Epple were
describing earlier, there is an inequality of income that creates a problem,which will always be there. San
Francisco study should be thrown out because methodology is so flawed. Pass on cost to the other 75%, if
we could do that, we would already be, flipping will be less attractive, this won't solve the problem,just one
more tool, this will have an impact on land values. If return of 3% is too low,people are not forced to do it.
One concern Mr. Carpenter has, if the builder has equivalency that is required,hopes that could be relaxed
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somewhat. Mr. Carpenter has some questions about what happens in case of foreclosure, dedication of land
in the case of foreclosure. Real estate tax would raise a lot of money, don't think it will have a lot of impact
on sellers.
Brian Caldwell said that the issue of sustained affordability,the cap of what someone could gain
from selling their property, there should be no limit,they shouldn't financially gain from the gift from the
program,they should financially gain as much as the mortgage they pay. If the home provided through this
policy is a$300,000 home, and 50% of home is financed/paid for, as a recommendation to CAHAB, the
way to maintain sustainability, limit the gain made by homeowner. Major concern is section C - subject to
the whims of nonprofits, to make it more equitable,take to heart that you profit from the part you participate
in, and not the community's investment in you.
President JP Pomnichowski began by saying that she agrees with a lot of what's been said,we need
a four-pronged approach to affordability. Mortgage assistance, qualification, equitability, a lot of aspects not
in the jurisdiction of the planning board. Board can help shape the policy that must work with the rest of
this, once a policy is passed, it won't be the end all be all,more participants will be involved. Struck by who
is not in attendance tonight. I don't know anyone who hasn't rented first, then ought a shoebox house, one
bedroom, or studio units. If someone needs a leg up in this market to get into something,there are some
tangible numbers we can toss around. Her suggestions would be—the city requires 10% of each
development be put into restrictive-sized lots,that has been done,no restricted-sized units put on restricted-
sized lots.
Chris Saunders said that there has been a couple in the last couple of months, and in a year to 18
months,building permits are starting to be issued.
President JP Pomnichowski stated that she doesn't think we should demand of one industry 25%, if
feasible, we should stay at 10%. She stated that there should be a review of this policy on a periodic basis,
at least a four year review, so if the market corrects itself and this is no longer needed, a review can be made.
3% cap not enough to gain equity,President JP Pomnichowski said that she likes what other board members
have said to solve that.
Dave Jarrett then suggested we go item by item and vote on each.
President JP Pomnichowski asked if there were any objections to that suggestion.
Mike Hope said that he would like to make a motion that the city commission can do what they want
to do. We were a unified board last time and the commission threw out everything agreed upon. Thinks
affordable housing is valuable,but doesn't think we will agree. Whether commission agrees with UDO or
not,it's a game of who can stall the most.
Mike Hope made a motion to approve Z-06152, Erik Henyon seconded.
Brian Caldwell stated that he thinks it would be sloughing off responsibility of the board if this isn't
given full purview of their time. The value of their opinion relative to the commission, if we think the
current document is amiss, we should try and come up with alternatives.
Dave Jarrett stated that he doesn't think we have an affordable housing problem, it is irrefutable that
there is no problem.
Erik Henyon said that there are alternatives out there,this is not the solution, and he can't stand
behind this at all. Would like to see more community involvement behind this, this is a subsidy that will
enable people and not let them grow as much as they can.
7
Nathan Minnick stated that this was trapping builders, and we are not addressing their freedom,.
President JP Pomnichowski asked for further discussion from the board.
Brian Caldwell stated that our task as board is to review this proposal, even with the best edits it is
not worthy of approval. Some form or shape of this will adopted on August 7.
Mike Hope stated that the city commission's elected officials are elected by public, if they make
right decisions,they will get reelected,if not, they won't. Thinks that if this passes,people will get more
involved in voting. Won't be on a board that is a rubber stamp. Mr. Hope offered the solution of getting
diverse officials in one room,with a representative from each industry to be a part of it.
Caren Roberty stated that this is a complex issue, and when you make one change, it will affect a lot
more things, it is difficult tonight to give rationales of why they arrived on their decisions, difficult to
explain why they reached their decisions.
MOTION: President JP Pomnichowski asked for further discussion,hearing none she asked that
the Planning Board members only vote on a motion to approve. In favor were Steve Kirchhoff, Caren
Roberty,Randy Carpenter,Edward Sypinsky, opposed were Brian Caldwell,Dave Jarrett, Erik Henyon, JP
Pomnichowski, and Mike Hope.
President JP Pomnichowski asked for discussion on the second motion.
Brian Caldwell described the forwarded motion—Part one is that 25% shall go to 10%, threshold
shall go from five to ten, sustained affordability is achieved by not capping the potential return, amount of
the home financed by the participant, but mortgage, timing of the construction of affordable housing shall be
concurrent with marketplace homes, the issue of the review of an individual plan shall remove the sentence
that a nonprofit can weigh in. The size of the unit should be specific to what is considered a safe home to
provide adequate housing.
President JP Pomnichowski would like to offer an amendment to Erik Henyon's motion—a
provision for a policy review every four years and changes to the policy based on that review, and a
consideration for one bedroom and studio.
Erik Henyon stated that he would like to withdraw his motion at this time.
President JP Pomnichowski stated that she will withdraw reference to one bed and studio.
Randy Carpenter stated that he would like to ask staff if they believe the market is cooling off, as
well as the feasibility of studying this every two years,not a full blown study,just some review of this every
two years.
Dave Jarrett thinks two years is equitable because of market changes.
Chris Saunders stated that the point is well taken that there is a certain lag time before it takes effect,
four years would be enough on initial implementation period, and added that there could there be a program
to monitor this. Director Epple stated that reporting to the commission is going to happen regardless.
President JP Pomnichowski called for a vote, those in favor were Edward Sypinski, Steve Kirchhoff,
Caren Roberty,Brian Caldwell, Randy Carpenter, and JP Pomnichowski, those opposed were Dave Jarrett,
Mike Hope, and Erik Henyon.
8
MOTION: Caren Roberty made a motion stating that as homes sell,the funds will be recaptured
for builder's impact fees. Edward Sypinski seconded the motion.
Brian Caldwell stated that those donations to affordable housing should go to affordable housing,
and it should go toward down payment assistance plans and programs already on the books,he would not
support this motion.
Chris Saunders asked for clarification from Ms. Roberty in regards to the intention for the
repayment, would those funds go back to the original development or a subsequent unit. Caren Roberty
responded that a reimbursement for the 10 homes they built, they would get back their money when the
homes sells. Chris Saunders then asked about the monies which are spent from dollars in hand today to
reduce amount of subsidy from builder, city recoups a portion of that,then that money would help reduce the
amount of subsidy on a home being built at that time. Caren Roberty stated that after houses are built, they
will reimburse the builder. Brian Caldwell said that that defeats the purpose of perpetuity.
Steve Kirchhoff said that he is not sure he follows it, and not sure why it is better than doing what
Brian Caldwell said earlier(putting money back in programs).
Caren Roberty said that it was widely suggested to her by builders that contacted her, that this will
help recoup quite a bit of money,no sources to building fees and impact fees.
Dave Jarrett asked stated that they would have difficulty tracking down the developer at a later date.
Caren Roberty stated that when the homeowner sells the house, they will have a kitty built up.
Caren Roberty then withdrew her motion. Edward Sypinski seconded.
President JP Pomnichowski described the motion on the table, to forward the recommended changes
to the policy as described by Brian Caldwell.
Erik Henyon stated that he has a problem with the fact that Ms. Roberty works with CAHAB, and
believes there is a conflict of interest. He added that it is inappropriate for Ms. Roberty to be voting on this
and she should step back from making motions and commenting.
President JP Pomnichowski stated that she had previously asked for the city attorneys opinion on
this,and no conflict exists.
President JP Pomnichowski then asked for discussion on the motion. Director Epple recommended
approval of the workforce housing ordinance. Mike Hope stated that this whole process was written to move
it down to where you want it to be, it was purposefully inflated, and he believes that is dishonest and he
refuses to participate in this process.
President JP Pomnichowski asked him to remain and participate, to which Mr. Hope stated that he
would not because it is a sham,numbers were overwritten on purpose, and he will watch from outside and
not participate. Mr. Hope then left the board table at that time.
President and Chairwoman JP Pomnichowski called for order at that time.
Steve Kirchhoff said to call Jeff Campbell of MSU and the CEO of Deaconness Hospital and the
City Commission to get their opinions on workforce housing. If people are going to say we need a task
force, or if you want to propose an alternative,you should. Brian Caldwell doesn't like this ordinance, but
9
he is trying to get people to agree.
Erik Henyon stated the he will personally bring an alternative proposal tomorrow.
Dave Jarrett mentioned that as he stated earlier,he must leave at 10:30 p.m. and he is not dropping
out.
Brian Caldwell stated that he believes their feelings have clearly been heard, and the majority does
not want to recommend this plan, don't need to be sold down the river on all the things, but input is our
duty, so we should vote.
President JP Pomnichowski called for a vote at this time, those in favor were Edward Sypinski,
Steve Kirchhoff, Caren Roberty,Brian Caldwell,Randy Carpenter, and JP Pomnichowski, those opposed
were Dave Jarrett and Erik Henyon.
ITEM 5. OLD BUSINESS
None
ITEM 6. NEW BUSINESS
None
ITEM 7. ADJOURNMENT
President JP Pomnichowski stated that the Planning Board will adjourn at this time, Zoning Board will
remain. There being no further business to come before the City Of Bozeman Planning Board, the
meeting was adjourned at 10:37 p.m.
JP Pomnichowski, President, Andrew C. Epple, Director,
City of Bozeman.Planning Board & City of Bozeman, Department of Planning &
Zoning Commission Community Development
*City of Bozeman Planning Board meetings are open to all members of the public. If you have a special need or disability,please
contact our ADA Coordinator,Ron Brey,at 582-2306(voice)or 582-2301 (TDD).
10
Workforce Housing Zoning Commission Resolution
RESOLUTION NO. Z-06152
RESOLUTION OF THE CITY OF BOZEMAN ZONING COMMISSION NOT
RECOMMENDING APPROVAL AND RECOMMENDING CHANGES TO A
PROPOSED AMENDMENT TO TITLE 18, UNIFIED DEVELOPMENT ORDINANCE,
CITY OF BOZEMAN MUNICIPAL CODE.
WHEREAS, the City of Bozeman has adopted a growth policy pursuant to 76-1-604,
MCA; and
WHEREAS, the Bozeman City Zoning Commission`has been created by Ordinance 1604
and Resolution No. 3312 of the City of Bozeman, pursuant to Title 76-2-307,MCA; and
WHEREAS, the City of Bozeman has pi6 ded thr, h Chapter 18.68, BMC a
mechanism by which possible revisions to Title 18, Unit .Development Ordinance, Bozeman
Municipal Code may be suggested; and
F.
WHEREAS, a proposal regarding rirloe housing was sil�tted as to the City
Commission; and
WHEREAS, the CityConimission des ri-d io have a f, sed community discussion on
the matter of workforce housing-; nd
14114
WHEREAS;the' ity Commission directedthe submitted proposal to be placed into a
form which would enable pttllic i mission of it merits and flaws; and
WIA'REAS, tl �rafted farm,creates a new Title 16 in the Bozeman Municipal Code and
revised Title 18; and
WHEREAS, because:the proposal would affect the Unified Development Ordinance,
Title 18 BMC,13vhich regulates mooning it was necessary for it to be properly submitted, reviewed,
and advertised �in,accordance; with the procedures set forth in Chapter 18.68 of the Bozeman
Unified Development Ordinance; and
WHEREAS, the proposal has been properly submitted, reviewed, and advertised in
accordance with the procedures set forth in Chapter 18.68 of the Bozeman Unified Development
Ordinance; and
WHEREAS, the City of Bozeman Zoning Commission and Planning Board held a joint
public hearing on Tuesday, July 18, 2006, to receive and review all written and oral testimony on
the request for a text amendment; and
WHEREAS, no written testimony was received prior to or at the public hearing; and
WHEREAS, 14 persons spoke at the public hearing with one in support, two neutral with
questions on the proposal, and 11 in opposition; and
WHEREAS, the City of Bozeman Zoning Commission after additional consideration of
the proposed amendment identified deficiencies in the proposed text amendment; and
NOW, THEREFORE, BE IT RESOLVED, that the City of Bozeman Zoning Commission, on a
unanimous vote of 4-0, recommends to the Bozeman City Commission that text amendment
application Z-06152 be revised and then given additional public eon - ration. Specific revisions
suggested are:
1) Reduce percentage of required cost limited units frtnn 25,0,% to 10%,
2) Raise threshold of participation from 5 dwellings to 10`dwellings
3) Provisions for sustained affordability to 4ow full recovery of apprej�ia.tion for that
portion of the home which the person has iidbdually paid for and recoupment of the
subsidized portion back into the workforce house`p r �c�gram
4) Construction of workforce unitsp be proportional to'that of market rate homes, i.e. nine
market rate per one workforce un
5) Review of proposed workforce hdusrn jj ?lementation a 's' to stay within existing
subdivision review process, eliminatewadditiofi view requirements
6) Minimum construction standards should fac s on si fblt�y"and adequacy, not replication of
the market rate ho14$irig
7) A review of .the program should be required 4 years after adoption and periodically
thereafter
8) Options for alternate omislialice should he provided to enable creativity in addressing
housing issues, including cash-in-lieu
9) Cost of screenig,potentia'l'�urchasers should not be borne by developer
lQ,,j Retain the existing Restricted'Sizr6"Lot and Restricted Size Unit requirements, Sections
3&4 of the draft proposal.
DATED THIS 1 " DAY OF JULY 2006 Resolution No. Z-06152
Andrew C. Epple, Director JP Pomnichowski, Chairperson
City of Bozeman Department of City of Bozeman Zoning Commission
Planning and Community Development
MINUTES
THE CITY OF BOZEMAN ZONING COMMISSION
TUESDAY, JULY 18, 2006
7:00 P.M.
ITEM 1. CALL TO ORDER AND ATTENDANCE
Planning Board President JP Pomnichowski called the meeting to order at 7:00 p.m. and directed
the recording secretary to note attendance.
Zoning Commission Members Present Staff Members Present
JP Pomnichowski Andrew Epple, Director, Planning and Community
Nicholas Lieb Development
Nathan Minnick Chris Saunders, Assistant Director, Planning and
Peter Harried Development
Jody Sanford, Senior Planner
Visitors Present Kelly Marple, Recording Secretary
Lyle Happel
Allan Lien
Tom Henesh
ITEM 2. PUBLIC COMMENT (0-15 MINUTES)
{Limited to any public matter within the jurisdiction of the Zoning Commission and not
scheduled on this agenda. Three-minute time limit per speaker.}
There was no public comment.
ITEM 3. MINUTES OF JULY 5"', 2006
President JP Pomnichowski asked for any changes or additions to the minutes of July 5, 2006.
None were offered, the minutes will stand as written.
ITEM 4. PROJECT REVIEW
A. Zone Map Amendment Application, #Z-06121 —(Norton East Ranch). A Zone Map
Amendment requested by the owner , Norton Ranch Inc., and applicant, Freund-Spencer
LLC, represented by Thomas Henesh at Morrison Maierle Inc., to establish a Mixed Use
municipal zoning designation of R-2 (Residential Two-Household, Medium Density
District), R-4 (Residential High Density District), R-O (Residential Office District), and B-
P (Business Park District)to241 acres. The Legal Description of this property is SEI/4
NWI/4, SWI/4 NEI/4, E1/2 SWI/4, WI/2 SEI/4, T2S, R5E, Section 9, Gallatin County,
Montana and is located on the current West Border of the City of Bozeman on Northwest
side of Huffine Lane (Sanford).
Planner Jody Sanford went over some of the details of this project, described the zoning
surrounding the property, and listed some of the uses of the adjacent properties. Planner Sanford said staff
found that zoning complies, therefore staff is recommending approval with contingencies listed on pages 8
and 9 of staff report. Planner Sanford stated that this project will include the annexation and if property to
the south is annexed to the city, then zoning will be adjusted. Contingency 2 is recommending that logic
is shown in how zoning is proposed. Staff received one public comment letter which addresses zoning
and questions the city commission's ability to make educated decision regarding zoning.
President JP Pomnichowski asked for questions for staff at this time. Nathan Minnick asked if
they will have to show how buffer is used, to which Planner Sanford answered that Applicant will be
required to supply an exhibit showing that the zoning makes sense. President JP Pomnichowski stated
that the 12 criteria are being met,but in regards to granting a zone map amendment, facilities sewer and
water, what is your opinion about extending that, will there be a greater cost to be borne by the city. Jody
Sanford replied that the sewage drainage zone does not exist, and the developer will have to develop it up
to the plant, expenses are to be borne by the developer, that issue is addressed in their terms of annexation.
Tom Henesh with Morrison Maierle, Inc. stated that he appreciates working with engineering and
planning staff and in regards to wetlands, they are concerned with neighbors to west and north and want to
work with them and they will listen to neighbor's concerns. Mr. Henesh added that they will be meeting
with neighbors to look at some concepts closer in detail. As far as the trunk main, Mr. Henesh assured
Ms. Pomnichowski that she was correct, it is in Cottonwood right now, and it is the Valley West trunk
main. Mr. Henesh added that they are out of that area and will be doing the trunk main to the north.
President and Chairwoman JP Pomnichowski OPENED THE MEETING FOR PUBLIC
COMMENT.
Lyle Happel, 4700 Gooch Hill Road North, Bozeman, Montana, 59718 stated that he owns one of
the conservation easements bordering the Norton East property. Mr. Happel handed out pictures of the
property to show how it currently borders the easements, as well as pictures showing the property
boundary of Laurel Glen. Mr. Happel stated that Laurel Glen is an example of where this has already
occurred, and something different should have been done, some kind of buffer between agriculture
easement land and conservation easement land. Mr. Happel stated that it should be some kind of buffer
strip to alleviate problems between residential, office building and agricultural land, and the buffer strip
should be a high consideration.
Al Lien, 8507 Huffine Lane stated that he is the other conservation easement on the same strip,
just a different corner facing the other way, and he concurs with Mr. Happel regarding finding better
alternatives.
Hearing no other comment, President JP Pomnichowski CLOSED THE PUBLIC COMMENT
PORTION OF THE MEETING.
President JP Pomnichowski returned discussion to the board.
2
Nicholas Lieb asked if a buffer zone had been considered. Jody Sanford stated that she had tacked
on an extra provision for a need to buffer the conservation easements to the west, and that it was hard to
do anything with zoning. She added that they could maybe have a strip of zoning for parks and even
though zoning wouldn't show it as a park, it could be.
President JP Pomnichowski stated that in regards to the 12 criteria that must be met, she finds that
Applicant has met them,and she is encouraged to see that there is sensitivity to the conservation
easements. She stated as her main concerns the wetlands, the conservation easements to the west, and the
water and sewer extensions. Ms. Pomnichowski stated that she likes the treatment along Huffine Lane, it is a
nice transition from busy to mildly used homes. Nathan Minnick said that he feels the same, likes the
transition into the surrounding areas. Mr. Minnick added that showing logical boundaries will help the
commission decide on zoning, and he found that it looks good. Peter Harried asked staff as far as the
R&H is concerned, what is the density to which Planner Sanford answered that that part of Valley West is
not in place yet, she does not know the density, and there is no proposal for staff at this time.
MOTION: Nathan Minnick made motion to approve BP with staff-recommended contingencies.
Peter Harried seconded the motion. Motion passed unanimously 4-0.
B. Zone Code/Text Amendment Application, #Z-06152 —(Workforce Housing). A Text
Amendment Application to revise local development regulations to remove requirements
from Title 18 for restricted.size lots and units and to create requirements in a new Title 16,
Housing for provision of workforce housing (Saunders).
Nathan Minnick asked how this would prevent overcrowding. President JP Pomnichowski said that
in terms of providing health and general welfare, a lot of these things will come when we see zoning
applications and can apply policy then, she added that she believes the policy does not meet the 12
criteria, but does not fail them either.
Nicholas Lieb asked if they were voting for some kind of change to the zoning,to which Chris
Saunders answered that the most direct impact on the zoning board is that if we remove restricted sized
lots, that existing language will be supplanted by housing language. Nicholas Lieb asked where RSL is
being seen currently, to which Chris Saunders pointed out Meadow Creek on South 19t1i, Flanders Creek,
and others, and stated that several are coming online in the next 3-4 months. Director Epple added that
there were probably around one hundred RSLs. Chris Saunders said that RSL provisions were from the
Bay Area, and were part of 12 major strategies in dealing with affordable housing.
Peter Harried said that from a zoning standpoint, he did not feel there is much the Zoning
Commission can do, and that he believes RSLs will create more affordable housing; it is the cost of land
that is driving the cost. Mr. Harried added that as a Bozeman resident and real estate agent, he sees a need
for affordable housing here because he sees people come in to buy a house, and find a better deal
elsewhere and move there. He believes that the developers who take a lot of the risk are going to take the
brunt of the payment, and there are better alternatives. Mr. Harned added that he thinks this will be
overturned in two years, and agrees that a group of eight people stuck in a room to determine the best
route would be a great idea, and that the document from the commission could have negative effects.
3
President JP Pomnichowski asked if there were any changes to the ordinance, and stated that the joint
meeting covered a lot of aspects that did not need to be repeated here.
Nathan Minnick queried staff on how someone would receive a housing subsidy, to which Planner
Saunders answered that there was currently a commission with HRDC which based their decisions on
income, duration of residency in the city, bonus points for family size, and said that it was a lottery type of
deal. Director of Planning and Community Development Andrew Epple stated that typically it was people
who have been through a first time homebuyer course and other programs who were eligible.
Nathan Minnick asked for direction on how to shape a motion following what was discussed
earlier that gave the developer a chance to do his own thing and tied into a waiver. President JP
Pomniehowski stated that Brian Caldwell had made a motion to forward recommendations to be considered
for the policy, therefore that's what she would recommend. Director Andrew Epple agreed and stated that
it would give them advice and guidance,but would allow the Planning Board to make the call.
MOTION: Nathan Minnick made a motion to forward recommendations, the consensus of the
planning board, developers to have the freedom to do their own thing, and it should not be the builder's
responsibility to pay for screening. Nicholas Lich seconded the motion.
President JP Pomnichowski asked for discussion on the motion, and said that the Zoning Commission's
scope is limited, and she finds that it meets the 12 criteria.
MOTION: Nicholas Lieb made a motion to retain Sections 3 and 4 regarding RSLs.
Nathan Minnick seconded the motion.
President JP Pomnichowski asked for discussion on amendment to RSLs. Peter Harned stated that in
his evaluation of the market, he thinks there will be a flood of affordable houses, therefore RSLs will not
be needed.
President JP Pomnichowski then asked for a vote on the motion. The motion passed unanimously 4-0.
President JP Pomnichowski then called for a vote on the motion on the table regarding builder
creativity. Nathan Minnick asked that they amend the language to read developer, not builder, language
was agreed upon. The motion passed unanimously 4-0.
C. Zone Code/Text Amendment Application, #Z-06161 —(Board of Adjustment). A Text
Amendment Application to revise local development regulations to include an independent
Board of Adjustment with defined duties and integrate them into the regulatory program.
Also to add prevention of nuisances to purposes of Title 18, and to make newspaper
noticing for initial zoning in conjunction with annexation conform to State law (Saunders).
Planner Chris Saunders went over the elements of the proposal, including the prevention of
nuisances, and modifying noticing requirements for initial zoning with annexation. He stated that current
state law states one notice in newspaper, but they are currently running three ads in the newspaper as well
4
as posting a sign. Staff believes it meets criteria.
President JP Pomnichowski asked for questions for staff at this time. JP Polrinichowski asked if
the newspaper notice is the only thing changing, to which Planner Saunders affirmed. Nathan Minnick
stated that the commission would not have to spend time on smaller projects and would be able to focus
on the bigger ones because items will go to the board of adjustment instead.
President Pomnichowski addressed Shawn Becker and stated that he has represented staff and
applicant, to which Mr. Becker replied that yes, he was a member of the city commission,but was the
applicant in this case. He added that there will be a need to have oversight of this board because they will
have a tremendous amount of authority, and that this could be a divisive issue in the community, i.e.,
quorums not being met and conflict of resolution not being resolved.
Peter Harned asked for clarification on whether it would be similar to this committee. Mr. Becker
stated that it would be judicial, would have a legal obligation as long as they are not arbitrary and
capricious, and that the board would make recommendations. Nicholas Lieb asked on what basis would
these board members base their decisions on, to which Mr. Becker answered that they would be
representing the public as a whole.
MOTION: Peter Harned made a motion to recommend approval of file number Z-06161,Nathan
Minnick seconded the motion.
JP Pomnichowski called for a vote on the motion at this time, motion passed unanimously 4-0.
ITEM 5. ADJOURNMENT
There being no further business to come before the City of Bozeman Zoning Commission,
President and Chairwoman JP Pomnichowski called for adjournment at 11:37 p.m.
JP Pomnichowski, President, Andrew C. Epple, Director,
City of Bozeman Planning Board and City of Bozeman, Department of Planning &
Zoning Commission Community Development
*City of Bozeman Planning Board meetings are open to all members of the public. If you have a special need or disability,please contact our ADA Coordinator,
Ron Brey,at 582-2306(voice)or 582-2301 (TDD).
5
STAFF REPORT
1 RKCFO CE:HOUSI G ID(T v1END 1T FILE NO. #Z=061
Item: Text Amendment Application #Z-06152. To revise local development
regulations to remove requirements from Title 18 for restricted size lots
and units and to create requirements in a new Title 16, Housing for the
provision of workforce housing.
Applicant: Bozeman City Commission.
PO Box 1230
Bozeman, MT 59771
Date: Before the Bozeman Zoning Commission and Planning Board on
Tuesday, July 18, 2006, at 7 p.m. in the City Commission Meeting
Room, City Hall, 411 E. Main St; and before the Bozeman City
Commission on Monday, August 7, 2006 at 7 p.m., in the Community
Room, Gallatin County Courthouse, 311 W. Main St.
Report By: Chris Saunders,Assistant Director
Recommendation: Conduct public hearing and receive public comment
PROJECT LOCATION
The proposed edits are applicable throughout the legal boundaries of the City of Bozeman as a modification
to the overall development regulations. Primary applicability would be, to areas zoned for residential uses.
In the case of protest against these changes signed by the owners of 25% or more of either of the
area of the lots included in the proposed change; or those lots 150 feet from a lot included in a
proposed change, such amendment may not become effective except upon a favorable vote of two-
thirds of the present and voting members of the City Commission.
PROPOSAL
The Community Affordable Housing Advisory Board (CAHAB) advises the Bozeman City Commission
regarding affordable housing issues. In early 2006 the CAHAB addressed the City Commission on the issue
of workforce housing and presented a proposal. After discussion over several weeks, the City Commission
directed the preparation of an ordinance which reflected the CAHAB proposal. The proposal has been
brought forward for public comment and discussion through the ordinance review process. The text is
attached to this report.
The proposal has several components and affects two different titles in the municipal code. As portions of
the proposal affect Title 18, Unified Development Ordinance, the proposal has been directed to the
Planning Board and Zoning Commission for review and comment.
#Z-06152 Workforce Housing Text Amendment Staff Report 1
Sections One and Two of the draft proposal create the new Title 16, Housing. The proposal includes a
requirement for the provision of a defined percentage of homes for purchase in new development to be
made available to households meeting defined income limits, sets applicability of the new regulation to
development, provides alternate means to comply with the requirement, allows for individualized plans to
comply with the standards, creates density bonuses for compliance with the regulations, establishes
construction and character of dwelling unit standards, requires owner occupancy of the affected dwellings,
establishes limits for appreciation to retain affordability, establishes requirements for buyer selection and
screening, requires construction of affordable units prior to other units in a subdivision, requires an
affordable housing plan, and requires disclosure of the location of affordable units to all purchasers.
Sections Three and Four revise "Title 18, Unified Development Ordinance, to remove some existing
regulations and incorporate the requirements of Title 16 by reference. The revisions would delete Section
18.42.180, BMC and requirements for a percentage of subdivided area to be provided as minimum sized lots
or defined alternatives, and remove a mandatory minimum density requirement. The revisions would further
delete Section 18.16.030.C, BMC which establishes maximum area requirements for homes subject to
Section 18.42.180,BMC.
REVIEW CRITERIA
Changes to zoning standards require evaluation of the proposed amendment with respect to the required
criteria set forth in state statute in Section 76-2-304, MCA, presented as follows. A summary of staff s
evaluation follows in the discussion below. A positive response for all criteria is not required for approval.
1. Is the new zoning designed in accordance with the growth policy?
The Bozeman 2020 Community Plan was developed over the period of 1999-2001, and was
adopted in October 2001. Chapter Five of the growth policy addresses housing. It
summarizes the number of housing units, construction by number and types, value, and
other descriptive information. Section 5.1 specifically discusses housing affordability. The
section notes that cost of housing increases since 1990 had materially outpaced increases in
household income for both rental and for purchase housing.
The chapter includes goals, objectives, and policies to be pursued to address housing issues.
These are listed on pages 5-13 through 5-16. Not all are specifically intended to address
income-qualified affordable housing but rather apply to all housing. The City has taken
several actions to help ensure an adequate supply of housing such as being active in
annexation, facility planning, and continuing a diverse zoning program with emphasis on
providing for attached housing. These have advanced the goals and objectives.
Some policies call for specific actions.
Policy 45) Conduct an affordable housing needs assessment at least every five years, and
prepare and implement an affordable housing strategic plan.
Policy 47) Ensure that the zoning ordinance includes both minimum and maximum
residential densities.
#Z-06152 Workforce Housing Text Amendment Staff Report 2
Policy 45 contains two parts. The City contracted with Bay Area Economics to conduct an
assessment in 2002. The City Commission adopted a resulting affordable housing policy
covering multiple aspects of housing in 2003 as Resolution 3630.
Policy 47 has been implemented. The proposed revisions to Title 18 would remove the
existing minimum density requirement for most of the community. A minimum density
requirement would remain for the R-4 Residential High Density District.
2. Is the new zoning designed to lessen congestion in the streets?
The proposed edits do not address items that would impact this criteria such as street standards or
parking requirements.
3. Will the new zoning promote health and general welfare?
Health is advanced by having adequate housing. The proposed edits have to do primarily with how
housing for certain income ranges is provided.
4. Will the new zoning secure safety from fire, panic and other dangers?
The proposed edits do not address items that would impact this criteria such as setbacks, or availability
of emergency services.
5. Will the new zoning provide adequate light and air?
The edits do not alter required compliance with building codes, setbacks, or other requirements that
address this criteria.
6. Will the new zoning prevent overcrowding of land?
The proposed edits remain in keeping with standards previously found acceptable for density.
7. Will the new zoning avoid the undue concentration of population?
Opinions of what constitutes "undue" concentration of population are highly individualized. Building
codes and similar development standards will ensure that the negative effects of concentrated
population are mitigated.
8. Will the new zoning facilitate the adequate provisions of transportation, water, sewer, schools,
parks,fire, police, and other public requirements?
The proposed zoning does not alter the requirements to provide for these services.
9. Does the new zoning give reasonable consideration to the character of the district?
The proposed regulations specifically call for housing of similar type to be provided as is already allowed
in the district.
#Z-06152 Workforce Housing Text Amendment Staff Report 3
10. Does the new zoning give reasonable consideration to the peculiar suitability of the district for
particular uses?
The proposed changes do not amend individual zoning district uses and therefore will not affect this
criteria. The edits are primarily applicable to residential zoning districts.
11. Was the new zoning adopted with a view of conserving the value of buildings?
The proposed regulatory language will apply to areas where new development is proposed. Existing
buildings are not expected to be impacted. Development standards for compatibility are not proposed
to be altered.
12. Does the new zoning encourage the most appropriate use of land throughout the municipality?
The decision that a property is appropriate for residential use will be made on the basis of the growth
policy designation. Choice of an individual zoning district will be made through the zone map
amendment process. This amendment will not change the individual districts and therefore will not
affect this criteria. The edits are primarily applicable to residential zoning districts.
PUBLIC COMMENT
No public comment has been received as of this writing. Any written comment will be forwarded at the
public hearings.
Conclusion
Pursuant to Section 76-2-304, Montana Codes Annotated, the Zoning Commission and Planning Board
shall review the Unified Development Ordinance text amendment application to determine if the proposed
zoning change meets the requirements of the Adopted Growth Policy, state statute, and other adopted state
laws and local ordinances. The Zoning Commission and Planning Board shall act to recommend approval
or denial of the Unified Development Ordinance text amendment. The recommendation of the Bozeman
Zoning Commission and Planning Board will be forwarded to the Bozeman City Commission for
consideration at its public hearing on August 7, 2006. The City Commission will make the fuzal decision on
the application.
Attachments: Attachment A—Draft ordinance revisions
Report Sent To: Community Affordable Housing Advisory Board
#Z-06152 Workforce Housing Text Amendment Staff Report 4
r3NCITY OF BOZEMAN
DEPARTMENT OF PLANNING AND COMMUNITY DEVELOPMENT
Alfred M. Stiff Professional Building phone 406-582-2260
20 East Olive Street fax 406-582-2263
P.O. Box 1230 planning@bozeman.net
Bozeman, Montana 59771-1230 www.bozeman.net
MEMORANDUM
TO: CITY COMMISSION
FROM: CHRIS SAUNDERS
RE: COMMISSION QUESTIONS FROM JULY 311T MEETING
DATE: AUGUST 2, 2006
At your July 31, 2006 meeting, the Commission requested additional information on several topics related to
the workforce housing proposal.
1) How many subdivisions would be affected by a change of applicability from 5 dwellings to 10
dwellings?
In the past five years the City has processed 109 preliminary subdivision plats. Eight subdivisions
had 6 to 9 lots and would potentially be affected by the change. Four of the eight were non-
residential subdivisions. Therefore, four subdivisions would be affected by the change of
applicability from 5 dwellings to 10 dwellings.
2) How many Restricted Size Lots (RSL) have been developed?
A more detailed reply is attached. In summary:
Seventeen subdivisions have been approved with RSLs
307 RSLs for attached or detached single household development have been approved
358,309 square feet of aggregated area for multi-household development have been approved
Sixteen RSLs currently have bade building permits issued for them, other lots have plans currently in
review and are expected to be issued building permits soon.
One dwelling on an RSL has been completed and issued a certificate of occupancy
3) Does the proposal address the many lots currently approved or under review? If not could it be
amended to be applicable?
The proposal applies to residential subdivisions (Section 1, paragraph 16.02.020.A). Therefore, as
written it does not apply to subdivisions which were deemed sufficient for review prior to the
effective date of any implemented ordinance. This is in accordance with the requirements of state
law as implemented by Sections 18.06.040.A and 18.64.080.A, BMC.
It may be possible to change the ordinance to affect previously approved subdivisions. To do so
would be complex and would require significant changes to the proposal. For example, the current
proposal places the responsibility to have workforce housing constructed on the subdivider. This
provides a single point of contact for coordinating where the units are built,how the housing plan is
developed, etc. It would be much more complex trying to coordinate between many lot owners. It
would also move the responsibility for program compliance from where the greatest flexibility in
cost has been identified, land purchase.
Part of the challenge is the level of knowledge available at the preliminary plat stage. This same issue
is a factor for park land dedication. Recent changes to Section. 18.50.020,BMC were made to create
planning . zoning • subdivision review < annexation • historic preservation o housing ® grant administration • neighborhood coordination
a mechanism addressing changes in density between preliminary plat submittal and actual
construction. This is very recent and has not yet been utilized on an actual development so its level
of success is unknown. A similar mechanism may be possible but would require addition of a
substantial cash-in-lieu component to the program. The assignment of responsibility to individual
lots may be problematic and contradict the requirements for a housing plan by the subdivider.
4) Can the review process (pipeline) be speeded up?
The City is subject to state limitations on how many days may be used to review a subdivision
proposal. In most cases reviews are conducted in substantially fewer days than are allowed. Many
factors are simply beyond the City's control such as weather, availability of consultants to design or
install infrastructure, and completeness of submitted materials. The City has been actively working
to streamline review processes for over ten years. Each time an opportunity has been identified it
has been taken. There is little,if any, non-essential effort left. Each step in the process is necessary
to ensure public access and accountability and comply with state law and constitutional obligations
for open government and public access. The options to reduce review time will only move the time
investment. It is more effective to address issues early rather than delay them.Availability of
infrastructure can be a limiting factor which is not always within the City's control. Staff would
appreciate an. opportunity to discuss in detail with the Commission the current procedures and steps
involved with development.
Page 2
CITY OF BOZEMAN
DEPARTMENT OF PLANNING AND COMMUNITY DEVELOPMENT
Alfred M. Stiff Professional Building phone 406-582-2260
MTV—ME 20 East Olive Street fax 406-582-2263
AP.O. Box 1230 planning@bozeman.net
Bozeman, Montana 59771-1230 www.bozeman.net
MEMORANDUM
TO: CITY COMMISSION
FROM: CHRIS SAUNDERS
RE: RESTRICTED SIZE LOTS STATUS TO DATE
DATE: AUGUST 2,2006
The following describes the current status of Restricted Size Lots to date. The requirement to provide
Restricted Size Lots took effect on January 1, 2004. The requirement therefore only applied to those
subdivisions submitted after that effective date.
Effective Date of Section 18.42.180 -January 1, 2004
Subdivisions with RSLs
West Winds Phase 1 & 2
Legends at Bridget Creek I
Flanders Creek
Rosa
Diamond Estates II
Meadow Creek
Oak Springs
Valley West Phase 3a
Cattail Creek III
Oak Meadows
Lydens
Legends at Bridget Creek II
Loyal Garden
Alder Creek 3
Cattail Lake
West Winds phase 3
The Knolls at Hillcrest
Number of approved
RSLs
Individual 5,000 sq. ft. lots 255
Individual 3,000 sq. ft. lots 52
Multi-home lots 358,309 square foot aggregated area
RSLs Platted
West Winds 1 8
planning • zoning • subdivision review • annexation • historic preservation • housing grant administration neighborhood coordination
Legends 1 12
Oak SpringsI&II 24
Cattail Creek III 2
Valley West IIIA&B&C 42
Flanders Creek 24
RSLs with Issued
Building Permits 16
RSLs with Homes and
Certificate of Occupancy 1
Page 2
Affordable Housing Support Currently in Place in the City of Bozeman
June 1, 2006
E 1 i E 1 ° ° E 1 C I
CAHAB -Advocacy and information Small minimum lot sizes and setbacks
clearinghouse, public entity in support of private
efforts such as ASI on Oak Street
Community Housing Fund—Commission Removed numerical dwelling unit density caps
discretion to financially support housing
Affordable Housing Revolving Fund - Annual Allow mixed uses to enable additional housing
financial support for matching funds, grants, and areas and options with transportation efficiency
loans—federal seed funds
Funding for HRDC Road to Home—Homeowner No minimum dwelling size beyond that required
training and down payment assistance by building code
Galavan/Streamline (transit) —Annual financial Established reduced parking standards for
support for transit services, relieves burdens of affordable housing
transportation
Community Needs Assessment for housing Allow manufactured housing within all residential
zoning districts
Efficient infrastructure planning and funding Allow modular housing within all residential
zoning districts
Fiscally responsible operation of the City Enabled Accessory Dwelling Units in all
residential districts
Limited bonding and other debt reduces tax load Allowed increased lot coverage in R-4 districts
for interest payments
Advance land use planning for greater surety in the Affordable housing projects given priority in
development process to reduce risk, cost, and review scheduling
delay
Option to pay impact fees for affordable housing Affordable housing is community benefit for
projects I meeting performance standards for PUDs
1 E E 57 0 of residential areas are zoned to allow multi-
home development
Montana Board of Housing—Reduced interest rate Park dedication requirements are capped so that
loans and reduced closing costs higher densities are less costly
CDBG— grant funds Alternative transportation options are a required
essential part of all street design and development
Section 8 — Cost support for housing expenses Allowed building heights have been increased
Six dwelling per acre minimum
Restricted size lots and dwellings
Community residential facilities allowed as
individual households in all districts when meet
standards
Community residential facilities allowed as in all
residential districts as either principal or
conditional use
Page l of 2
Exclusionary Zoning Elements`
o Minimum floor area for dwellings (usually far in excess of actual need)
o Exclusion of multiple household dwellings
o Restrictions on the number of bedrooms
o Prohibition on manufactured homes
o Large lot frontage requirements
o Large minimum lot size requirements
*pp.40-41, The Legal Guide to Affordable Housing Development, American Bar Association, Chicago,
IL 2005
Page 2of2
CAHAB Proposal Public Hearing Draft
Workforce Housing text amendment implementing language
This text represents the placement into ordinance format of the proposal given to
the Bozeman City Commission by the Community Affordable Housing Advisory
Board (CAHAB) in early 2006. The ordinance reflects the creation of a new title
in the Bozeman Municipal Code, which is titled Housing. This placement enables
related programs and requirements to be located in a common location within the
City's legal structure.
The draft ordinance presented here has four sections. Sections 1 and 2 implement
the CAHAB proposal. Sections 3 and 4 remove elements of the existing
affordable housing program from Title 18, Unified Development Ordinance,
Bozeman Municipal Code.
***Those sentences in bold italics led and terminated by asterisks indicate
revisions the City Commission has directed to be incorporated in the draft.***
Section 1
Title 16,Housing
Chapter 2,Workforce Housing
16.02.010. Purpose
The purposes of this chapter are to:
A. Require the construction of for-purchase workforce housing as a portion of new
residential development;
B. Create offsets for the resultant costs to development for the provision of workforce
housing;
C. Create an ongoing supply of affordable homes for purchase by the low and moderate
income workforce.
*** City Commission directed on July 31" that the program be
reviewed after 4 years and periodically thereafter***
16.02.020. Applicability
A. A developer of a residential subdivision which will result in construction of five or more
dwelling units shall provide, or shall cause to be provided, to the extent feasible, twenty
five percent (25%) of the total dwelling units for the workforce housing program, as
outlined below.
***City Commission directed on July 31" that the percentage be
reduced to 10% throughout the proposal***
B. Project Size:
1. Projects with fewer than five dwelling units - No workforce housing
requirements
2. Projects with five to twenty-five dwelling units (5-25). Twenty-five percent of
the units in the subdivision must be dedicated to workforce housing requirements
(including any additional dwelling units approved through a density bonus).
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Workforce Housing text amendment implementing language
*** City Commission directed on July 31S` that for the purpose of
calculating the number of required workforce units any bonus
dwellings be not be included***
3. Projects with more than twenty-five dwelling units (25+). Twenty-five percent of
the units in the subdivision must be dedicated to workforce housing requirements
(including any additional dwelling units approved through a density bonus),
subject to the provisions of Section 16.02.040.
16.02.030. Affordable Housing Plan Required
The developer of a subdivision shall submit, prior to or concurrently with their application for
preliminary plat approval, an application describing their affordable housing plan in accordance
with this and other applicable ordinances. The developer's affordable housing plan must, in
addition to items listed above, include a marketing plan and estimated project timeline.
16.02.040. Methods of Compliance
A subdivision required to provide workforce housing according to this chapter may meet its
obligations according to one or a combination of the methods established below. Rounding:
Where the calculated required total workforce housing dwelling units includes one-half or
greater portion of a dwelling, it shall require the provision of one full dwelling unit.
A. Projects with five to twenty-five units (5-25):
1. Twenty-five percent (25%) of the dwelling units in the
subdivision must be dedicated to workforce housing, including any
additional dwelling units approved through a density bonus. ***
City Commission directed on July 31" that for the purpose of
calculating the number of required workforce units any bonus
dwellings be not be included***
2. All dwelling units must be constructed within the boundaries of the subdivision.
B. Projects with twenty-five Units or more (25+):
1. Twenty-five percent (25%) of the units in the subdivision must be dedicated to
workforce housing, including any additional dwelling units approved through a
density bonus.
***City Commission directed on July 31"that for the purpose of
calculating the number of required workforce units any bonus
dwellings be not be included***
2. Alternative Option:
a. Rather than providing, or causing to be provided, the full number of
required work force dwelling units, the requirement for up to half of the
number of required ,dwelling units (12.5% of the total dwellings) may
instead be satisfied through the dedication of one (1) parcel of land to the
city. The land must be suitable to the construction of the required number
of dwelling units if constructed at the same density as in the subdivision
for which the land is proposed as a replacement. The land dedicated must
be without abnormalities and with complete environmental review. The
value of the land dedicated must be equal to or greater in value (as
Page 2 of 8
CAHAB Proposal Public Hearing Draft
Workforce Housing text amendment implementing language
determined by independent appraisal) than the total value of the finished
lots which would have been utilized for the up to 12.5% of the total
dwellings for which the land is offered. The site must be economically
feasible to develop the required number of dwelling units, be appropriately
zoned, and be fully improved with infrastructure.
b Under option 2, at least half of the required dwelling units (12.5% of the
total dwellings) must be constructed in the subdivision.
C. Individualized program:
1. A developer may meet the city's workforce housing requirements through an
individualized program. To be eligible, the proposed program must provide a
level of affordability equal to or greater than the amount that would be
generated under the standard guidelines. The individualized program is subject to
all standard city staff, board, commission, and public review. In addition the
project will be subject to one additional public meeting m front of the Community
Affordable Housing Advisory Board for review and comment by community-
based non-profits. The meeting shall review:
a. Project feasibility,
b. Community need for project,
C. Overall benefits and drawbacks of project
d. Compliance with all applicable affordable housing and workforce housing
regulations.
2. The CAHAB will make a recommendation to the City Commission on each
individualized program, which will make final decision.
*** City Commission directed on July 31" that the review of the
plans be incorporated into the regular subdivision review
process***
D. Waiver. A developer may request a waiver from the requirements of this chapter. A
waiver request must be submitted to the Community Affordable Housing Advisory Board
simultaneously with application for preliminary plat subdivision review. The CAHAB
will make a recommendation to the City Commission on each waiver request, which will
make a.final decision.
*** City Commission directed on July 31" that additional
opportunities for creativity to comply with the requirements be
allowed including workforce unit banking, and cash-in-lieu***
16.02.050 Cost of Housing
A. Price of Dwelling Units: The units will be affordable to moderate income households
paying 30% of their monthly income toward Principle, Interest, Taxes, and Insurance.
AMI will be determined by HUD and verified and (if necessary) adjusted annually. The
price will be set based on a 30 year, fixed rate loan at the Montana Board of Housing rate
plus 1/2% as of January 1 of each year. Prices will be determined January 15 of each year
and approved by the City commission. The maximum sales price shall be published on
the City's website and available at the City planning office.
I. Two bedroom units will be affordable to a household of 2 earning less than 80%
of the Area Median. Income (AMI);
2. Three bedroom units will be affordable to a household of 4 earning less than 80%
of the AMI; and
Page 3 of 8
CAHAB Proposal Public Hearing Draft
Workforce Housing text amendment implementing language
3. Four bedroom homes (when allowed) will be affordable to a household of 6
earning less than 80% of the AMI.
B. Owner-occupancy: All workforce housing units must be owner occupied and must
remain as the principal residence of the occupant for the duration of their ownership.
C. Buyer selection and screening: Units produced through the Workforce Housing Program
are available for purchase by households earning less than 120% of the Area Median
income for their corresponding household size as determined annually by HUD.
Screening shall be carried out by the City at the expense of the developer.
*** City Commission directed on July 31" that screening costs
would not be at the expense of the developer***
D. Sustained affordability: The following measure will be applied to ensure that sustained
affordability is achieved in the workforce housing:
1. Appreciation on the unit will be capped at 3% per year, maximum. A person
purchasing a workforce housing unit will only be eligible to receive a maximum
of 3% appreciation each year. This is the maximum. appreciation allowed, not the
guaranteed rate of appreciation. Purchasers will receive a maximum appreciation
schedule at closing.
*** City Commission directed on July 31" that the cap be raised
to 4.5%per year maximum***
2. The City of Bozeman will be granted a first right of refusal on the property.
3. The maximum rate of appreciation will apply for the first 10 years of ownership.
After 10 years of ownership, any workforce housing deed restriction on the
property will be removed. If the house is sold before 10 years, the new buyer will
be subject to the workforce housing eligibility requirements and a new 10 year
affordability period will commence.
*** City Commission directed= on July 31" that extending the
duration of the affordability requirement be considered***
4. In the event of the sale of the property before ten years, appreciation of the
property is calculated. If the actual appreciation of the property is less than the
maximum appreciation, the owner receives the actual appreciation (less costs). If
the maximum rate of appreciation is equal to the rate of appreciation, the owner
receives the maximum rate (less costs). If the actual appreciation of the property
is greater than the maximum rate (3%), the owner receives the maximum rate
(3%) and the difference will be allocated to the City's Affordable Housing fund.
16.02.060. Cost Off-Sets
A one-to-one density bonus will be provided for each dwelling unit meeting the workforce
housing requirements, whether on-site or through land dedication. Density of development must
be such that the density bonus does not cause the individual lots to have dimensions or
constructed dwellings to have characteristics which are less than minimum standards established
by Title 18, BMC.
16.02.070 Additional Requirements
Page 4 of 8
CAHAB Proposal Public Hearing Draft
Workforce Housing text amendment implementing language
A. Housing Mix: Developer must provide a mix of two and three bedroom homes. Four
bedroom homes may be allowed by exception. A minimum of half(50%) of the homes
must be three bedroom homes. All homes must provide a minimum of two bathrooms.
All homes must have at least a single car garage. One bedroom homes will not be
allowed to meet workforce housing requirements. While Accessory Dwelling Units are
encouraged to increase density within a subdivision, ADUs can not be used to meet
workforce housing requirements.
B. Unit type: Unit type of the workforce housing units must be of the same type as the units
in the subdivision. In the case of a mixed-use development (such as single-family
detached and attached housing), the workforce housing units must be of type in the same
proportion as the units that are not constructed as part of the workforce housing program.
C. Livability: The workforce housing units shall be functionally equivalent to market rate
units in the same subdivision. Features included in market rate units must be included in
workforce housing units, however; the type of features need not be identical.
Non-regulatory Note: The spirit of this regulation is to allow for flexibility
on the part of the developer. For example, while-,market rate homes may
have Corian countertops,, workforce housing`units could use laminate.
Quality of the unit is a concern here - some cities have been forced to
write regulations regarding the necessity for closets and kitchen cabinets
due to inadequate quality of workforce units.
D. The location and type of the proposed workforce housing must be identified on the
developer's affordable housing plan. The workforce housing lots must be dispersed
throughout the subdivision.
16.02.080. Criteria for Location, Integration, Character of Affordable housing Units
A development subject to this chapter shall comply with the following criteria:
A. Timing of Units: The workforce housing units must be constructed before any other units
in the subdivision. Building permits will not be issued for remaining lots until the
workforce housing units have received Certificate of Occupancy.
*** City Commission directed on July 31" that workforce units
be constructed at a proportional rate to market rate units, i.e.for
each nine market rate units one workforce unit must be
constructed***
B. The location and type of proposed workforce housing in a development must be disclosed
in writing by each seller to each. subsequent purchaser of the lots or dwelling units until
all workforce housing units in the development are completed.
Section 2
Chapter 4,Definitions
Page 5 of 8
CAHAB Proposal Public Hearing Draft
Workforce Housing text amendment implementing language
16.04.010. Affordable Housing
Housing for persons earning less than 65 percent of the area's annual median income for rental
housing and 100 percent of the area's annual median income for purchased housing. Further,
affordable housing does not require greater than 30 percent of the household gross annual
median income for housing. Annual median income is defined by the Department of Housing
and Urban Development. Affordable housing is subject to the City's affordable housing policy.
16.04.020. Workforce Housing Dwelling Unit
Affordable housing subject to covenants or restrictions requiring such dwelling units to be sold at
prices that will preserve them as affordable housing for a period of at least 10 years.
16.04.030. Affordable Housing Development Plan
That plan prepared by an applicant under this ordinance that outlines and specifies the
development's compliance with the applicable requirements bf this title.
16.04.040. Affordable Housing Fund
The fund(s) created by the City of Bozeman to support the provision of affordable housing.
Section 3
18.42.180 Provision of Affordable Housing
Development shall be evaluated against the requirements of Title 16. When applicable, the
development shall comply with the requirements of Title 16. --
*** City Commission directed on July 31" that Sections 3 and 4
would not be removed***
giving2. The 2003 14ausift9 Needs Assessment established the need fer- additienal lew and
3. The City Geffitnissieft hftg adopted an affordable heu��g pehey
r-eEfair,eng nts and previding ether-related means ef addressing heids�g
5. Develepment ef the n�nimum sized lets shag lafgely depend en the aetiens e
rs ,.If 4,'-Q t:tlo
Page 6 of 8
CAHAB Proposal Public Hearing Draft
Workforce Housing text amendment implementing language
heusing.
per if,
i. 4he tetal area ef stieh lands being subdivided fer-r-esidential ptirpeses in A phase
,
—ppreval of the subdivision by the Gity.
rest--ie6ons with the fiaal plat, offei:4ig for sale to any wAtifig buyei! the RSL lots
transferred te the Ck�, not later than the time ef final plat appr-eval ef
site RSLs shag net be eempfised ef mere than 59 pereent RSJ=s v4thei:ft piier-
Page 7 of 8
CAHAB Proposal Public Hearing Draft
Workforce Housing text amendment implementing language
000
5,900 in single heuseheld distriets anEl
r >
rcc^ji-kired rRK.4he-anprai`sal nest sha be b beef A -land been
Gen-A94ssien the area r-eqi--:.-----' may be assembled iftte latter- lets te allew
nt-. et a ram+ n++r.-dnble heusing
.-.le
Si.,e T nks /RCT TI
Section 4
18.16.030 LOT COVERAGE .AND FLOOR AREA
A. Maximum lot coverage by principal and accessory buildings shall be:
1. For newly created lots in the'R-S district, determined: through the PUD review
procedures set forth in Chapter 18.36, BMC, in compliance with the adopted
Bozeman growth policy.
a. For existing lots in the R-S district, not more than 25 percent of the lot area
shall be covered by principal and accessory buildings.
2. Not more than 40 percent of the lot area in the R-1,R 2,R-3 and RMH districts.
3. Not more than'50 percent In the R-4 district.
4. Not more than 40 percent for residential uses or 60 percent for nonresidential or
mixed uses in.the R-O district.
B. Minimum floor area requirements for:each dwelling in all districts shall be that area required
by the City's adopted International Building Code.
.
Ptevision of Affer-dable Hettsieg, (exeludieg at-ea used fei! a garage) s a14 net, emeeed _9 Afi-e-er
of tvx iet area.
Page 8 of 8
COMMISSION RESOLUTION NO. 3630
A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF BOZEMAN,
MONTANA, ESTABLISHING AN AFFORDABLE HOUSING POLICY FOR THE CITY
OF BOZEMAN AND SUPERSEDING THE AFFORDABLE HOUSING POLICY
PREVIOUSLY ADOPTED BY COMMISSION RESOLUTION NO. 3037.
WHEREAS, the City Commission did, on the 19th of December 1994, adopt Commission
Resolution No. 3037, establishing an affordable housing policy, based on the recommendations of its
Bozeman Housing Task Force; and
WHEREAS,the Community Affordable Housing Advisory Board identified the need to amend the
affordable housing policy to more accurately reflect current needs; and
WHEREAS,the City of Bozeman entered into an agreement with Bay Area Economics to conduct
a study and submit recommendations for a new affordable housing policy; and
WHEREAS, Bay Area Economics submitted its recommendations to the City of Bozeman in May
2003; and
WHEREAS, the Community Affordable Housing Advisory Board subsequently modified those
recommendations to more accurately reflect the community needs; and
WHEREAS, the City Commission, at its meeting on September 8, 2003, indicated general
support for the recommended policy.
NOW, THEREFORE, BE IT RESOLVED by the City Commission of the City of Bozeman,
Montana,that the Commission hereby adopts the Affordable Housing.Strategies, dated September 22,
2003, a copy of which is attached hereto as Exhibit"A" and by this reference made a part hereof.
PASSED AND ADOPTED by the City Commission of the City of Bozeman, Montana,at a regular
session thereof held on the 22nd day of September 2003.
ATTEST:
STEVEN R. KIRC HO , yor
R IN L. SULL N
Clerk of the Commission
ARP D A M:
P J.
City Attorne
Exhibit "A"
AFFORDABLE HOUSING STRATEGIES
September 22, 2003
Strategy L Housing Affordability Guidelines
1 The City will use the HUD Gallatin County Area Median Income (AMI) or, if
supplied, the HUD City of Bozeman Area Median Income (AMI),
2. Using HUD definitions, households shall pay no more than 30% of their gross
annual income towards their housing payment.
3. Bozeman's Standard Housing Affordability Income Guidelines for homeowners
are 61-100% of the AMI.
4. Bozeman's Standard Housing Affordability Income Guidelines for renters are
40% to 60% of the AMI.
Strategy IL Regulatory and Process Reforms
1. Major site plans with no deviations can be approved by City planning staff,
2. Concurrent development of infrastructure and housing should be allowed for
affordable housing in appropriate situations.
3. Whenever practical, all City Departments will give priority to projects that
exceed affordability requirements.
4. As opportunities arise, City Staff will explore ways to reduce development
costs without compromising the livability and quality of the neighborhood.
5, The City will continue to work with the legislature to revise subdivision
guidelines to encourage more dense development,
6. The City will develop systems to provide details on types of units being
developed. Information gathered shall include inventorying vacant land,
existing housing and buildings, and tracking new subdivisions in order to
provide market information,
7. The City will invite the business/building community to suggest possible
additional regulatoryand process reforms and streamlining thatwould promote
construction and rehab of affordable housing.
Strategy Ill. Restricted Size Lots(RSL) & Restricted Size Units (RSQ)
1 As stated in the 2020 Plan, every residential annexation into the City of
Bozeman of five acres or more, that is not zoned as Residential Suburban
shall have a minimum net acreage density of 6-8 units when subdivided.
2. Every residential annexation of five acres or more that is not zoned as
Residential Suburban shall have a minimum of 10% of the buildable net
acreage dedicated to Restricted Size Lots (RSL)that are 4,900 to not greater
than 5,000 square feet for single famity household detached (6F9 SHD)and
27500-to 3,000 for single fam+y household attached (ASF SHA) units when
subdivided. The RSL shall bue dve-oligimia-ted designation shall be recorded with
on the final subdivision plat.
3. The total floor area of the unit built on an RSL (minus the garage) shall not
exceed a ratio of 1:3.3. Units built on RSLs shall be known as Restricted Size
Units(RSU). Example if the lot is 4,000 square feet the square footage of the
house can not exceed 1212, or a ratio of 1 square foot of floor area per every
3.3 feet of lot.
4. In lieu of designating the required number of RSL for market sale with the final
plat, the owner may provide a donation c; by fee-simple transfer of title of
J
buildable donat duvuiupeu RSLs to the City, I ca U11c; UU11C3LC;U I V1 U re!
requiredubemis with 1 fee simple transfer RSL being equivalent to 3 for market
sale RSLs. The City will utilize donated RSLs or the proceeds of sales only
for affordable housing. d annexed
V cal I I I I VA LVO
5. In lieu of designating RSLs within the subdivisiem bu-:11-1
land being subdivided the owner may designate off-site comparable RSLs-erm
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a one required-flor one -repl eed-bes+t at a ratio of 1:1. The subdivision
containing the off-site fee vsimple transfer RSLs cannot be comprised of more
than 50% RSLs without prior City Commission approval, The off-site fee
simple transfer RSL shall be established and transferred to the City not later
than the time of final plat approval of the subdivision responsible for creating
the fee simple transfer RSL.
6. Within multi-household zoning districts and with approval from the City
Commission, the area required for RSLs may be assembled into larger lots to
allow construction of affordable housing complexes.
67. At residential annexation, in lieu of supplying the required numberof RSLs,the
owner may pay a "cash in lieu" fee to the City. The payment shall be
calculated as the appraised value per square foot of developed land within that
: _J L_ ,
specific subdivision at the time of final plat approval multiplieu vy-J-�-tz-o
- - -
C11 vi I'll L.;I I I lumplium VY LI IV
The cost per square foot shall be multiplied by 5,000 in single household
districts-and by 3,000 in multi-household districts for each required RSL. The
appraisal cost shall be borne by the owner of the land being subdivided. The
City will use payments in lieu of RSLs only for affordable housing.
78. City staff will give high priority to ensuring that RSURSU language is included
in the Unified Development Ordinance as soon as possible in autumn 2003.
This language will be subject to the sunset clause described in Strategy IX.
Strategy IV. Home Ownership Program
1 The City shall cause to be developed a down payment assistance program for
home purchasers whose household income meets Bozeman's Standard
Housing Affordability Income Guidelines.
2. The down payment assistance program shall include components of home
ownership education and counseling, information on mortgage products and
affordable housing assistance programs, and referrals to developers of RSU.
3. Families who meet the City's Standard Housing Affordability Income
Guidelines, have completed the down payment assistance program, and
qualify for a Class A Mortgage shall be known as target income purchasers.
4. Households whose income is below Standard Housing Affordability Income
Guidelines, but meet all the other criteria of a target income purchaser, may
be considered for down payment assistance; however, the households must
have additional financial assistance from alternate sources so that the amount
of the City's down payment assistance does not exceed the amount generally
supplied to target income purchasers,
5. The City shall develop a system to track RSL and building permits for RSU so
that target income purchasers can be notified when units are being developed.
6. During the construction process, builders of RSU will give priority to target
income purchasers who qualify to purchase the home.
7. The down payment assistance program will work with local lenders and state,
federal and private affordable housing programs to develop a variety of home
ownership options and information packets for interested parties.
Strategy V. "Very Low-income Units"Development Incentives
1. "Very low-income" is defined as housing that is affordable to households
whose income is below the City's adopted Standard Housing Affordability
Income Guidelines. Incentive developed housing is affordable to households
whose gross annual income is below 60% of the AMI for for-sale-homes or
40% of the AMI for rentals.
2. Conditional upon prior City Commission approval and funding availability, an
affordable housing developer may enter into an agreement with the City to
receive building permit fee waivers, waiver of other City fees, impact fee
reimbursement, and/or financial assistance in exchange for developing very
low-income units. The impact fee reimbursements,fee waivers, and financial
assistance shall collectively be referred to as "Housing Development
Incentives."
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3. Although Strategy V is not limited to affordable housing developments, the
Housing Development Incentives will need to be combined with another
subsidy program in order to achieve affordability for very low-income
households.
4. The City will reimburse the developer for the agreed upon amount of Housing
Development Incentives upon occupancy of the very low income units and
eligibility verification of the unit and occupant.
5. The affordability period for very low-income units shall be the greater of 20
years or, if the owner is participating in another public or private entity's
housing program, the guidelines of that entity's program.
6. For-sale very low-income houses shall be tracked with a deed restriction.
7. Very low-income rentals shall be tracked through the City's property inventory
system recommended in Strategy 11.
8. The owners of very low-income rentals will annually submit eligibility along with
a $25 fee per unit to the monitoring agency. If the information is available
from another monitoring source, the owner can substitute that entity's
monitoring certification and pay no fee.
9. For-sale, very low-income units shall have the subsidy forgiven at the rate of
1/20th annually. If the home is resold prior to the 20th year the owner shall
repay a pro-ration of the subsidy to the City's affordable housing fund.
10. One and two bedroom units that are affordable to persons below 40% of the
AMI shall be reimbursed at a rate of 100% of the Housing Development
Incentives per qualifying unit.
11. Three and four bedroom, two bathroom units that are affordable to persons
below 40% of the AMI, shall be reimbursed at a rate of 150% of the Housing
Development Incentives per qualifying unit.
12. For units affordable to person below 30% of the AMI, Housing Development
Incentives will be doubled.
13. No more than 50% of the units in a development may receive Housing
Development Incentives.
Strategy V1. Additional Financial Contributions
I Alternative or additional financial incentives to for-profit and nonprofit
affordable housing developers would be on a case by case basis as
recommended by the CAHAB and approved by the City. Examples would be
land grants, low-interest loans, property tax abatement, and or infrastructure
assistance.
2. The City will complete legal research to determine if property tax abatement
is allowed for affordable housing projects under State law. If so, the City will
make any changes necessary to local laws to permit this option to be made
available.
3. The City will welcome any financial data made available by for-profit and non-
profit affordable housing developers that will help the City determine the
amount of financial incentives/assistance needed to make it possible for the
private market to respond to the City's high-priority housing needs.
Strategy V11. City Participation
1. The City of Bozeman will dedicate a minimum of $200,000 annually to the
Community Affordable Housing Fund,
2. To assist with the annual affordable housing funding commitment,the City will
dedicate at least 50% of economic development impact fees collected from
Big Box stores to the Community Affordable Housing Fund.
Strategy M. City Land
1. Should the City receive property of 10 acres or more not earmarked for
another use, a priority for the use of the property shall be a model subdivision
designed to showcase the development goals of the 2020 plan.
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Strategy IX Biennial Review, Sunset Provision
1 Biennally after adoption,the CAHAB, in conjunction with City staff, shall review
the City's affordable housing priorities and strategies and make
recommendations to the Commission as necessary to meet the City's
affordable housing needs and goals, as identified in the 20246-� City's
adopted growth policy, the 2003 Housing Needs Assessment, and any
subsequent needs assessments prepared for the City.
2. A sunset clause will be included in ordinances and code revisions adopted to
implement strategies 11 and III to ensure mandatory review and timely revision
of housing policies in response to changing housing needs. (The sunset
clause should specify a five-year period or an alternate length of time to be
determined through discussion among City staff,the City Commission,and the
CAHAB, with public input from the building industry and other interested
organizations.)
Strategy X. Business Plan, Long-term Funding Stream
I Upon City adoption of Affordable Housing Strategies and ordinances, the
CAHAB will work with City staff to complete a business plan regarding annual
and five-year budget needs; funding sources (grants, big box fund, general
fund, housing loan repayments, etc.); staffing; and so forth.
2. The CAHAB will work with City staff, the City Commission, and interested
organizations to create a reliable long-term funding stream for the Affordable
Housing Fund, to ensure a base of predictable funding for the first-time home
buyers' program and for rental housing. One intent will be to strive to reduce
the level of City General Fund commitment necessary to maintain the City's
affordable housing programs through diversification of funding sources and,
if possible, eventual endowment of the Housing Fund.
3. The City, in cooperation with other interested organizations, will aggressively
pursue grants to help with affordable housing.
Strategy Xi. Additional Potential Actions for Research and Consideration
I The City will review the purposes of the Design Review Board and consider
the advantages and disadvantages of redefining its purposes—such as shifting
its development review responsibilities to staff—or eliminating the board. If the
City chooses to redefine the role of the DRB, it will not eliminate DRB
development review only for affordable housing projects, which need to
receive the same degree of review as all housing projects.
2. The City will consider a guaranteed timeframe for review and approval of
affordable housing projects.
3. The CAHAB, in cooperation with City staff,will assess establishing a residency
requirement for the home buyers'program,and a possible provision regarding
full-time students, and make a recommendation to the City Commission.
4. The City will research the legality of selling parcels of long-unused, perhaps
impractically located or sized parkland, or of building affordable housing on
them.
5. The City, in cooperation with any interested local organizations, will consider
developing a kiosk or referral service for affordable units to make it easy for
very low-income and low-income residents to find housing in their price range
without developers of this housing needing to spend significant sums on
marketing.
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D Cc, �C�IC
2103 Highland Court
7AU�G0 1 2006 Bozeman,Montana 59715
DEPARTMENT OF PLANNING Tel: 406 587-1479
AND COMMUNITY DEVELOPMENT E-mail: Ftraeger@aol.com
July 28,2006
Department of Planning and
Community Development
City of Bozeman
PO Box 1230
Bozeman, MT 59771
Dear Department of Planning:
I am writing to ask you to oppose the proposed city ordinance to selectively subsidize
housing. More such.social engineering and the distortions that would be caused by it will
only be harmful to the majority of Bozeman citizens and taxpayers.
I have lived in many places(including seven cities)where I have had to commute to work
(up to 1 V2 hours one-way) from an"affordable"home and neither I nor anyone I knew
expected someone to subsidize housing for us so that we could ride our bikes or walk to
work. If some people find housing in Bozeman:too expensive,why shouldn't they
commute from a lower housing cost town or county?
If we subsidize housing in Bozeman(a very attractive place to live)there may be almost
no end to the number of people who would be attracted to live here.
Subsidizing housing can also be viewed as subsidization to businesses and their
customers because to some extent it lowers the cost of what employers have to pay their
employees.
All available housing is affordable by somebody;that which isn't eventually is lowered
in price until someone"affords" it.
Although she does not always get her facts and comments right Tammy Nall certainly did
get it right in her Chronicle column of July 21. Please re-read it.
Sincerely,
Fredrick W. ger
rcayl-_ i uo G
Rich Sherlock
From: "Rich Sherlock" <aplusbozeman@bridgeband.com> ]U�_ 2 4 ?006 UU
To: "Malby, Andy" <amalby@belgrade-news.com> -
Sent: Thursday, July 20, 2006 3:32 PM DEPARTMENT OF�'._f-;\,flNG
Subject: Guest editorial AND COMMUNITY DFV`i PMENT
THE AFFORDABLE HOUSING DEBACLE: MORE GOVERNMENT MEDDLING
The City of Bozeman is contemplating an ordinance that would require developers to make 25% of the
dwelling units they build to be "affordable," if the development has five or more homes.
The thinking involved in this proposal is bewildering. The Bozeman city government believes it should have the
authority to force a developer to sell 25% of the homes he builds at a loss. Where does this authority come
from? Well, I spent about an hour reading the Bozeman Municipal Code, and I could find no provision that
grants the city the ability to seize this kind of authority over a legally operating business.
One might wonder what the developer has done to warrant this kind of punishment. After all, the developer is
not causing the problem, he actually is contributing to the solution. By increasing the supply of available
housing units the demand will eventually decrease and prices will come down. This is simple economics, a
concept that must be unknown to those in city government.
Yes, it must be ignorance. After all, the city has also implemented impact fees, punished Walmart for being too
successful, delayed the construction of Lowe's, and forced companies like Zoot Enterprises to build outside
the reach of these heavy-handed leftists. And to what end? Well, they are the cause of the problem they are
attempting to solve. Every time government meddles in the free market system, it causes more problems than
it solves.
But this is the mentality of government do-gooders. They love to force other people to pay for their
"compassion." Somehow they think that the changes they impose happen in a vacuum, that no other factors
will be influenced by their actions. They are convinced that they are smarter, they care more, they can do it
better. They believe that the free market is, well, too free. They are looking for a problem that doesn't need
solving. But their unshakable faith in the ability of government to micromanage other peoples' lives knows no
bounds.
So what will change if the ordinance is implemented? Well, put yourself in the shoes of the developer. You are
working hard to put food on your table and pay your electric bill, just like everyone else. You have X number of
dollars, just like everyone else. Then the city comes in and says that one out of four homes you build must be
sold at the price they dictate, and, according to the draft ordinance, you have to build the affordable homes
first before you can build a home that will actually make you money.
You have these choices: 1) lose money, and cancel your vacation or cut back on eating out, 2) make up for
your losses by charging more for the remaining houses, or 3) build houses outside the reach of the city,
thereby carving up farmland and contributing to sprawl. What would you do?
Also worth asking: Shouldn't people buy homes based on their ability to pay for them? If a family is unable to
buy a home based on their income, they should remain renters, right? Fact is, there is no right to home
ownership. Government should not be making the rest of us to pay for some others to buy a home they cannot
otherwise afford.
Or maybe it's diabolical genius. The city is making private businesses a defacto arm of government.
Developers would no longer be able to pursue their own private interests. They be forced to embrace the
government's social policy priorities.
7/20/200E
Page 2 of L
Government would essentially be i, Amenting a tax on developers with- .r raising taxes. This tax would filter
down to the end user in the form of, surprise, more expensive housing. Yes, the affordable housing program
will make 75% of the new houses in the city more expensive.
Yes, this is the genius of government meddlers.
Rich Sherlock
388-6988
i
7/20/2006