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Missoula County adopts TED workforce housing policy to guide TIF support
Summary
Missoula County commissioners voted April 2 to adopt a two-track Targeted Economic Development District workforce housing policy that defines how tax-increment financing (TIF) can support attainable and deeply affordable housing, after staff and developers negotiated density and affordability guardrails.
Missoula County commissioners on April 2 adopted a Targeted Economic Development District (TED) workforce housing policy intended to guide use of tax-increment financing (TIF) to support housing projects in county TEDs.
John Wilkie, housing specialist for Missoula County, told the board Missoula is facing “a housing crisis,” citing an estimated shortage of about 2,400 units and a large gap between median home-price growth and income growth. He said the policy responds to a 2021 state change that allowed local jurisdictions to use TIF for workforce housing and establishes two tracks: an "attainable" track aimed at market-led projects using design and density guardrails (target density about 11 units/acre, smaller unit sizes and more modest finishes) and an "affordable" track for nonprofit-led projects using established programs and stricter income and rent limits.
Wilkie said the county developed the policy after workshop discussions with more than a dozen housing developers and community stakeholders and that the policy is intended to balance being workable for developers while producing housing that is genuinely affordable for county residents. He described criteria the county will use to evaluate applications, including project costs, financial need, amount of TIF requested relative to public benefit, consistency with TED growth plans, and the mix of housing types. He noted deeper TIF support, including limited vertical construction funding, may be offered for nonprofit affordable housing that demonstrates significant public benefit and long-term affordability.
Public comment included concerns about who benefits and whether projects will remain affordable. Kevin Davis of the Reserve Street Public Working Group urged the board to consider the fiscal impacts on other jurisdictions, saying, “TIF diverts funding away from schools, law enforcement, and fire protection.” Wilkie and commissioners said those concerns and other public feedback (some callers urged stricter long-term affordability rules) were considered during policy development.
Commissioner discussion emphasized the trade-offs between strict income-based affordability requirements and designing a policy that developers will use. The policy includes explicit flexibility so local projects that face higher infrastructure costs in TEDs can be viable.
The board moved, seconded, and voted to approve and adopt the TED Workforce Housing Policy. Commissioners directed staff to use the policy framework when evaluating upcoming TED projects and applications for TIF support.
The policy is expected to shape consideration of three near-term projects Wilkie identified in TEDs at the Y, Grant Creek Crossing, and the West Bonner Log Yard. Staff said the policy will be applied when those developers seek TIF assistance.
