Kalispell postpones expansion of use of TIF funding for workforce housing

At this time, Kalispell is on hold on a proposal to expand the ability of workforce housing projects to apply for city funding.

The city council voted on Monday to indefinitely postpone a pair of ordinances that would still have allowed tax-increase financing (TIF) funds for such projects.

The Council split on the votes. Councilors Ryan Hunter and Jed Fisher voted in opposition, both noting that they would rather vote to approve or reject the changes than postpone.

City staff introduced the proposal this summer, but City Manager Doug Russell said Monday staff had changed their recommendation.

“What we came up with was to extend an available tool and what we found were differences of opinion on that,” he said. “We thought it might be a good idea to take a break from discussions about workforce housing in the TIF district.”

Noting that the Board regularly votes on topics it disagrees with, Hunter said he would rather vote than delay.

“I fear that if we postpone it now, we will never see it again and we will lose a tool that could have helped our community,” he said.

But Mayor Mark Johnson said TIF funds can still be used for infrastructure costs for housing projects while the city considers other options for a “community-wide” housing program.

“That will allow us to put that aside for now so we can continue the conversations,” he said.

The proposal would have updated two urban renewal plans to specifically enable the provision of TIF funds for workforce housing, which is often used to indicate a scheme for households earning too much to qualify for subsidies. traditional housing for low-income people.

A developer can still request from the city that TIF funds be directed towards a project‘s infrastructure costs, but the proposed change would have expanded this to allow a developer to request funds to help with vertical construction costs. .

The proposal was a source of contention among Council members. Some favored the proposal while asking for changes, still others argued that it was unnecessary as developers can still apply for TIF infrastructure funds, thus reducing the overall price of a project and causing a reduction in housing costs.

Councilor Chad Graham said TIF funds should be used for projects that reinvest in the district and not for a “social agenda”.

The proposal also sought to set income parameters to determine who would qualify for the resulting housing units developed with the use of TIF funds.

City staff suggested funding focus on workforce housing for households with an average median income between 80% and 120%. In Flathead County, the estimated median income for a household of four is $80,300. To be considered at 80% of the AMI, a household of the same size would have to earn $63,500. To be at 120% AMI, the household would earn $95,300.

But the income metrics have drawn criticism from the Council and the public.

Some advisers wanted the income threshold to be below 80% of the MAI, while others said there should be no income guidelines to provide the most flexibility.

Several housing experts told the Council that they struggled to help those in housing need who fell below the 80% threshold.

Ahead of the vote during public comment, Cassidy Kipp of the Community Action Partnership of Northwestern Montana applauded the Council for being late.

“I’m excited to have ongoing conversations about it,” she said.

Managing Editor Heidi Desch can be reached at 758-4421 or [email protected]

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