McCall council discusses tightening deed‑restriction incentives, separating rental and ownership tracks

The McCall City Council held an extended work session Jan. 2 to review a five‑year evaluation of the city’s Local Housing Incentive Program and to discuss recommended changes to deed‑restriction rules and new program tiers.

Adrian Quinn, a housing consultant working with the city, told the council the existing voluntary program has produced 16 incentive units currently occupied — 10 homeownership units and six rentals (one an accessory dwelling unit) — and that 45 units were in the pipeline expressing interest in the program. Under the current program the city provides a $10,000 reimbursement per incentive unit in exchange for a voluntary deed restriction; recipients must occupy the unit and meet local employment or senior/disability criteria. Staff said the program is intentionally voluntary and that occupancy and work requirements are enforced by deed restrictions.

Quinn and staff reviewed several proposed changes. For seniors, staff proposed adding a residency requirement (a commonly used standard in other mountain jurisdictions is 10 years of residency in the local footprint, not necessarily consecutive) to limit eligibility to long‑term local residents. Council members debated whether to couple residency with a work history requirement; some members warned about enforcement hurdles for seasonal workers and potential fair‑housing concerns raised by the city attorney, Bill, who cautioned against creating a disparate impact on protected classes.

Councilors also discussed changing the occupancy/work requirement from the program’s current six months to nine months to emphasize year‑round residency. Staff noted other jurisdictions use nine to ten months to distinguish incentive units from short‑term or seasonal housing and to recognize school‑year employees, while some council members argued that rental and homeownership products should be treated differently and that a strict 12‑month occupancy rule could be impractical.

Another recommendation would bar converting deed‑restricted homeownership units into market rentals; several council members favored keeping a hardship exemption so owners could request temporary rental authorization if personal circumstances require it. Staff suggested objective hardship criteria (economic, medical, family necessity) subject to city review and legal vetting.

Quinn presented a possible new affordability tier for rental units: a second incentive level that would increase the payment to $20,000 per unit if units are restricted and rented at rates affordable to households at roughly 50% of area median income (AMI). Staff said such a tier would be most effective if layered with other tools — land banking, expedited permits, fee waivers, partnerships with nonprofits, or use of city‑owned lots — because a $20,000 subsidy alone may not be sufficient to make smaller owner‑occupied units financially feasible for developers.

Council discussed the McCall Avenue long‑term lease program and employer‑provided housing (examples cited: Shore Lodge, Brundage, St. Luke’s and the school district) as part of the broader housing context. Staff noted state and federal mortgage programs and down‑payment assistance (Idaho Housing and Finance Association, USDA and VA products were referenced) can affect buyer affordability and that market variables such as down payment, interest rates, taxes and HOA fees change outcomes for potential homeowners.

No ordinance or code amendments were adopted at the session. Council and staff agreed to return with revised draft program documents that separate the rental and homeownership tracks, refine residency and occupancy language, identify hardship criteria for conversions, and detail funding and implementation options — including land‑banking and potential modular or small‑lot development on city parcels — for council consideration at a future meeting.

Council members characterized the session as productive and asked staff to draft revised documents based on the guidance provided.