River Falls staff present regional housing data; city to consider code changes to encourage missing-middle units and ADUs

City of River Falls staff on July 1 briefed the Planning Commission on regional housing trends and local data showing increased construction costs, tight vacancy rates and sustained permit activity, and outlined planned zoning-code updates to permit more density, missing-middle housing and accessory dwelling units (ADUs).

"Regional housing or housing markets tend to be regional, not local," Amy Peterson, the city’s community development director, told the commission, summarizing material presented by Professor Kurt Paulson and other regional sources. Peterson and senior planner Harley Milhorn presented state, regional and River Falls data showing that household growth has outpaced housing-unit growth in recent years, construction costs rose sharply after 2020, and vacancy rates for owner-occupied housing remain very low.

Peterson said statewide building permits remain below pre-2004 levels and that statewide median sale prices rose more than 50% since 2019. Using St. Croix County figures, she said occupied housing is about 77% owner-occupied and 23% rental, rental vacancy about 3.2% and owner vacancy about 0.6%. She also announced a St. Croix County roadshow on July 24 at which the county’s housing study findings will be presented in River Falls.

Milhorn reviewed River Falls-specific numbers and trends, saying local construction-cost data tracked the national geometry of increases but with smaller magnitude. He summarized the city’s 2014–2024 series and said River Falls saw a 27% jump in average estimated single-family construction cost from 2020 to 2022; the 2020–2024 point-to-point increase in the city’s index was 14%, reflecting a change in building types in 2024 (many twin homes) rather than an actual decrease in material cost. Milhorn said River Falls achieved a high level of permit activity in 2024, reaching about 6.3 permits per 1,000 population (the presentation compared that to a pre-pandemic Wisconsin baseline reported at about 6.7 permits per 1,000 population).

Milhorn said the city is using the data to inform implementation of the comprehensive plan and listed code changes under consideration: increasing allowable densities across residential zoning districts, permitting more missing-middle housing in R-1 and R-2 districts, reducing minimum lot sizes for single-family lots, adopting an accessory dwelling unit ordinance, revising multifamily open-space requirements toward an amenity-choice approach, and updating parking standards to use land efficiently. On ADUs he explained that an ADU is a subordinate dwelling on a single-family lot and may be detached or attached and typically is smaller and tucked behind or beside the main house.

Commissioners asked clarifying questions during the presentation, including whether the national construction-cost figures were adjusted for inflation (not specified in the presentation) and what drove the material cost increases; staff attributed those increases primarily to raw-material and supply-chain pressures after 2020. Milhorn said more specific code language is being drafted and "we are actively working on it, internally and hopefully, soon it'll come before this commission for review." No formal code changes were proposed or voted on at the meeting.

The presentation referenced the city’s comprehensive plan and the St. Croix County housing study as sources for the regional data and policy rationale. Staff said additional details and proposed ordinance language will be brought back to the commission when ready.