Where Should the Locals Live?

More than 15 years ago, as the first director of Whitefish’s nascent planning department, Bob Horne helped write a growth policy to steer the booming mountain town’s rapid growth. In it, he emphasized the sustainability of natural resources, smart land-use planning, economic development, transportation, and affordable housing, which he saw as inextricable threads that, if stitched together thoughtfully and responsibly, would create an enduring community fabric.

Today, Horne and other community fixtures in Whitefish say that fabric is being torn asunder by legislation that undermines the city government’s authority to craft solutions tailored to the town’s unique set of challenges, including its workforce-housing crisis.

“If your community has a robust housing market with high demand and escalating prices for all types of residential units as we do in Whitefish, you are probably pricing out or at least cost burdening a number of your essential workers, like police, firefighters, teachers, nurses, and service industry personnel,” Horne told members of the Montana Legislature’s Senate Local Government Committee earlier this month, as they considered a measure to dismantle Whitefish’s Legacy Homes Program. “This program is one part of the solution.”

Horne was testifying in opposition to House Bill 259, which would abolish Whitefish’s affordable workforce housing program by prohibiting its “inclusionary zoning” ordinance, a statute requiring that a share of some new residential construction — that requiring a discretionary permit, such as a conditional-use permit — be designated affordable for people with a certain income. With support from powerful lobbying groups representing Montana’s building and real estate industries, as well as out-of-state groups like Americans for Prosperity, the bill has cleared every legislative hurdle and is headed toward Republican Gov. Greg Gianforte’s desk.

But opponents like Horne, as well as the leaders of Whitefish’s Chamber of Commerce, its tourism and convention bureau, and its entire slate of elected city officials, say the bill and the consequences it will have on the city’s burgeoning affordable housing program will erode the character and authenticity that gives Whitefish its allure to begin with.

“What inclusionary zoning allows you to do is to harness a bit of that highly lucrative market to provide permanent affordable housing for at least some of these essential workers,” Horne said. “We have some great builders in Whitefish, but they did not create the hot market that we are trying to harness a piece of — that market was created by the community. And again, that market is very lucrative for developers, builders, realtors, building suppliers, lenders and everyone in the development industry. But if it were not for the foundation of this community, the market would not exist.”

The inclusionary zoning ordinance serves as the centerpiece of the Whitefish Legacy Homes Program, which is not yet two years old and has produced little in the way of tangible development or affordable inventory. But the program is designed to help working residents with moderate incomes enter into a housing market they otherwise could not, a challenge that in Whitefish and communities like it is becoming increasingly prevalent.

Under HB259, the Whitefish Legacy Homes Program would lose its inclusionary zoning enforcement ability, rendering the program ineffective, and prompting supporters to urge local control on an issue that varies from community to community.

Kevin Gartland, executive director of the Whitefish Chamber of Commerce, said his business members oppose the bill in part because it strips away local control, but also because they are increasingly hamstrung by a diminishing workforce as droves of workers are being priced out of the community they serve.

“The inclusionary zoning program created by the Whitefish community is not the result of liberal Whitefish politicians shoving their radical philosophies down the throats of our businesses and our residents,” Gartland said. “This program and the larger strategic housing plan was created at the behest of the Whitefish business community. I can tell you this because I am the one who went to city council five years ago at the request of my board of directors to ask for the city’s help in putting together a plan for an issue that my 450 business members believe is the most critical obstacle not only to maintaining our economy but growing it. And that’s a complete and total absence of housing that is affordable to the folks who drive our economy. Our workers.”

In Whitefish, the affordable housing program is just the latest undertaking in a series of regulatory steps by the city to build out the local inventory of affordable housing, a scarcity of which has priced out many middle-income, working-class residents, leaving them with few options for finding cost-effective living arrangements. When the problem was first identified and discussed, local employees complained of having to commute from neighboring communities like Columbia Falls and Kalispell; now, they’re commuting from as far away as Eureka and Libby.

According to a workforce housing needs assessment released in December 2016, middle-income residents have limited options when it comes to finding housing, a problem that is displacing locals and forcing them to live outside their chosen community — 56% of Whitefish’s workforce lives in neighboring communities, 34% of whom would prefer to live in Whitefish. The assessment also noted that only 70% of Whitefish homes were occupied by locals, which marked a 10% decline from 2000.

“The affordability gap is now valley-wide,” Whitefish Mayor John Muhlfeld told state lawmakers this month. “I ask you, where are the workers who are the building blocks of our communities supposed to live? We ask that you keep local decision making at the local level. We know what is best for our town.”

Karin Hilding, a city engineer in Whitefish for more than 25 years, described how the city’s pioneers, including the famous Baker brothers, after whom Baker Avenue is named, donated land and materials to build Whitefish’s early infrastructure, including its roads, water and sewer lines, recognizing the need to accommodate the growing community.

“Though the roots of Whitefish are strong, the prices of homes are causing these roots to be cut,” Hilding said. “The families that built our town don’t have this type of money, and few kids growing up in this town will be able to return to live here. So as someone who has spent 25 years helping to build a vibrant community with resilient infrastructure, my work would have been wasted, as it would have helped create a town without real people. The Baker Brothers and the folks who came after them didn’t sacrifice to create a beautiful town to have it sold off as an exclusive playground.”

Since 1995, Whitefish has aggressively used a resort tax collected from lodging, retail, bars, and restaurants to make capital improvements designed to support its resort-community components and out-of-state and seasonal residents, including by building bicycle paths, improving streetscapes and parks, and repairing existing infrastructure like roads, storm sewers, sidewalks, curbs, and gutters.

The Legacy Homes Program, supporters say, is yet another example of a local solution crafted at the local level.

“The reality is that Whitefish is harnessing its active market that they created in the first place, and they’re doing it to get cost-controlled, deed-restricted housing units so that a portion of our essential workers can actually live in the community that they serve,” Horne said. “That in turn makes Whitefish even more diverse and vibrant and even more desirable for a live-work-and-play experience. Ladies and gentlemen, when you build great places, people want to live there. Please let us continue to grow the Legacy Homes Program and make Whitefish an even greater community. Please table this unfortunate bill.”