by William Skink

Over the weekend I took a look at some zoning issues that impact housing, specifically the idea of liberalizing the zoning code, or “upzoning”.

This is a national trend because it ultimately benefits developers. The jury is still out on whether the implementation of these policies are actually producing the desired effects on housing supply and affordability.

Today’s post is going to take a look at a different type of zoning that Missoula COULD have had if the three year process of developing a set of housing policies had included it in its policy recommendations.

Unfortunately, inclusionary zoning was NOT one of the tools the city decided to go with when it rolled out its set of policy recommendations to deal with the housing crisis in Missoula.

The reason I’m thinking about inclusionary zoning again is a headline in today’s Missoulian, which reads Missoula Opportunity Zone: Officials research affordable housing.

The word in the headline I want you to pay extra attention to is “research”. From the link:

The Missoula Opportunity Zone has seen a couple of large projects break ground using the Opportunity Fund so far, including a new engineering office and a new gastroenterology facility. Those projects will upgrade sewers, sidewalks, roads, lighting and street trees in the low-income Westside neighborhood through the use of Tax Increment Financing. Much of Missoula’s Opportunity Zone overlaps with Urban Renewal District II, where developers are eligible for TIF awards.

In November, staff with the Missoula Economic Partnership visited three communities in Oregon to meet with developers and tour specific projects.

For one, they toured a 21-story mixed-use building in Portland called YARD. It’s mostly a luxury apartment complex, but 25% of the units are designated as workforce units for people who earn 80% of the area median income or less. The developer got 10 years of tax abatement and a 20% reduction in fees in exchange for making sure the workforce units are affordable in perpetuity.

Let me summarize what’s going on here so you can be as thoroughly pissed off as I am.

First, the opportunity zone provides a financial tool for investors to avoid paying taxes on capital gains.

Second, public money is utilized to prepare the ground for development, and all the increased value from this development will go to the Missoula Redevelopment instead of the general fund.

Third, because Missoula DOES NOT HAVE inclusionary zoning, MORE SUBSIDIES are being “researched” to further sweeten the development pot for affordable housing.

In Portland, the developer scored 10 years of tax abatement and a 20% reduction in fees, all so a mere 25% of a LUXURY APARTMENT COMPLEX can be offered to the “workforce” who will serve the residents their avocado toast.

Last June, Hermina Harold penned a great op-ed about the big mistake Missoula made when officials refused to include the inclusionary zoning tool in the old too box (a worn out metaphor if you ask me). This part is worth repeating:

Recently, the Missoula City Council was handed a slate of housing policy recommendations to review, and they have work to do before the June 24 vote. The policy recommendations are skewed in the direction of developer incentives. These types of incentives largely failed when Bozeman and Whitefish tried them. Both cities have now switched over to mandatory inclusionary zoning policies.

We don’t have the luxury of time to wait and see if the incentives work and then change course. A University of Montana Bureau of Business and Economic Research study from 2018 reported that when median wages are compared to median home prices, Missoula housing is already less affordable than Bozeman, Denver, Seattle, Portland and Miami.

I am asking our City Council and Missoula Redevelopment Agency to enact two regulatory policies to stop the displacement of working people: 1) mandatory inclusionary zoning and 2) Tax Increment Finance District affordability requirements.

Because our local officials like to either ignore or incarcerate those who don’t go along with their gentrification schemes, Harold’s plea fell on deaf ears. No surprise there.

If Missoula officials had been able to hear the public over the loud cha-ching of more TIF loot, there would be no reason to visit Oregon to research how to create MORE subsidies for developers.

Sadly, that’s not how things played out in our liberal utopia.

Stay tuned as our electrd gentrifiers plot more “incentives” to get the public a few peanuts as the building boom continues and our collective debt bomb ticks down to a macro reset.