Kalispell to Allow TIF Eligibility for Workforce Housing
Councilors on Oct. 7 unanimously approved ordinances that will allow TIF-funded eligibility for workforce housing developments within certain areas of the municipality
By Maggie Dresser
Kalispell city councilors on Monday night unanimously approved ordinances that will allow workforce housing projects to become eligible for tax increment financing (TIF) within certain areas of the municipality.
The ordinances amended the Downtown and West Side/Core Area Urban Renewal Plans to include workforce housing for households with an income of 60% to 140% of area median income (AMI) as an eligible project. Councilors amended the original AMI range of 80% to 120% to reflect current state law.
The amendment will allow workforce housing as potential developments to the urban renewal plan, which was adopted to use TIF funding to promote economic development, improve employment and housing opportunities while expanding the tax base in downtown Kalispell and the North Meridian neighborhood. Project proposals would still be subject to council approval.
Originally brought forth in 2022 as the city experienced a rapid population growth, the ordinances were tabled following negative public feedback and an absence of project proposals.
Despite skepticism among some council members about the use of TIF dollars for workforce housing, the amendment was approved unanimously with Councilor Jed Fisher absent from the meeting.
“I know we need workforce housing, and I do like seeing that this is another tool that we can go and use,” Councilor Chad Graham said. “I have a little heartburn about it – but I’m going to go ahead and support this and see how it goes.
Previously, major TIF-funded projects include the Parkline Trail, Glacier Rail Park and the future Charles Hotel and parking garage. The addition of workforce housing eligibility could open the door for potential workforce housing projects and aid developers with financing.
Councilor Ryan Hunter, however, proposed additional amendments that failed to gain support from councilors that would add more regulations for developers like requiring workforce affordability for a minimum of 30 years or guaranteeing workforce homeownership in perpetuity.
“My concern with this is that without sideboards it can become a handout to developers that can abuse it,” Hunter said.
Eligible workforce housing developments would serve households earning between 60% and 140% of AMI. In 2022, Flathead County’s estimated AMI for a four-person family was $80,300.
For example, if a four-person household met the 80% threshold, they would be able to afford a monthly housing cost of $1,587 without exceeding 30% of the household’s gross income. A four-person household at a moderate income of 120% would be able to afford $2,382 per month.
Since the council last reviewed the ordinances in 2022, the state Legislature adopted definitions regarding workforce housing, which defines “attainable workforce housing” as a household spending no more than 30% of gross monthly income for a mortgage payment, property taxes and insurance.
Northwest Montana Community Land Trust Executive Director Kim Morisaki spoke in support of the ordinances and said she looked forward to a potential partnership with the city in the future and suggested permanent avenues like deed restrictions and ground leases.
“The one thing I’d love to encourage about this in the future is to really think about permanent affordability rather than one-time projects,” Morisaki said.