‘Compromise’ bill aims to put $100+ million more toward Montana affordable housing program

A compromise between the Republican House Speaker and Democratic House Minority Leader could send another $115 million to the coal severance tax trust fund to be put toward housing for low- and middle-income Montanans.

Speaker Matt Regier, R-Kalispell, introduced House Bill 927 Tuesday, which cleared the House Taxation Committee in a unanimous vote shortly after its initial hearing. The first proponent to testify for the bill was Minority Leader Kim Abbott, D-Helena.

Regier told the committee there was bipartisan agreement heading into the 2023 legislative session that lawmakers needed to act to address the housing shortage and affordability issues in the growing state, and called the bill “one more piece of that conversation” along with a host of other bills.

“I think, as the puzzle comes together toward the end [of the session], we need to make sure that all the pieces are on the table and that we can put that together,” Regier said. “If it’s not, we’re just going to be short on the conversation.”

The Montana Board of Housing is currently allowed to administer $15 million of the billion-dollar trust fund toward loans for developing and preserving homes for low- and middle-income Montanans under a bill passed in 2019. HB927 would send $115 million in general fund dollars within 15 days of the bill being signed to the trust fund, which the board could then put toward the same housing effort.

The Board of Housing approved seven loan commitments under the program to seven rental housing projects that would lead to 252 rental homes in Belt, Cascade, Havre, Livingston, Helena and Laurel, according to a fiscal note on a separate bill written by the Governor’s Office of Budget and Program Planning. At the end of 2022, financing had closed for six of them, totaling approximately $14.2 million of the initial $15 million in the program.

Regier acknowledged the Republican supermajority had “overspent” so far this session and that lawmakers would have to decide which measures to move forward while keeping a balanced budget. But he said he hoped the measure was “part of the puzzle” as the legislature moves through the final third of the session.

Abbott testified in favor of the bill, saying she was representing the entire Democratic caucus. She said while there had been tension in the Capitol as to how to spend the $2 billion surplus and the budget at large, especially with a Republican supermajority, she appreciated Regier was “willing to put this in to keep the conversation going.”

“We know the workforce issues that we’re seeing. We hear it every single day. It’s one of the major barriers to getting employees, is having attainable housing in the communities where the jobs are,” she told the committee. “So, we think this is a really good idea. We think it’s part of the conversation.”

Melissa Shannon, a lobbyist for the Montana Housing Coalition, said an array of affordable housing supporters would strongly support the measure. Rebecca Meyers, representing the Billings Chamber of Commerce and Montana Economic Developers Association, said both organizations saw the bill as an opportunity to further the conversation on housing and the coal trust to address the “massive” housing crisis.

Home prices in Montana skyrocketed to an average value of $446,000 in June 2022, compared to $296,000 two years earlier, according to a report from the Montana Department of Labor published last fall. The same report found that about 42% of renters in Montana spent more than 30% of their income on rent in 2021 and said that share had likely grown in the year since.

While lawmakers tabled an effort from Sen. Ryan Lynch, D-Butte, to put $2 billion toward the coal trust fund, House Bill 546 from Rep. Dave Fern, D-Whitefish, would double the $15 million the trust fund put toward the housing program by the 2019 legislature. His bill is still awaiting action in the Senate Business, Labor, and Economic Affairs Committee.

But during Tuesday’s meeting, Fern thanked Regier for what he called the “surprise” HB927.

“It’s Christmas all over again,” he said.

Abbott’s own bill to put $500 million toward workforce housing, HB 574, was heard in House Business and Labor earlier this month. According to the legislative bill tracker, no further action has been taken on the bill.

Abbott said in a press availability after the hearing she and Regier had started talking about what would become the measure six weeks ago as each tried to find middle ground on investing in affordable housing and saving some surplus money – even if they are still not “totally aligned” on the solutions.

She said her sense is the Governor’s Office “isn’t thrilled” with the measure but echoed Regier’s sentiments, saying she hoped it would stay in consideration by lawmakers as a possible solution from both parties.

The committee voted 21-0 to move the bill forward Tuesday morning after the hearing and sent it to the House Appropriations Committee.

“I thought the tax committee, both my caucus and [Regier’s], was pretty stunned by it, and that was kind of fun,” Abbott said. “You know, you never know where some bipartisanship is going to pop up in the building. And I think it was a good compromise for us on things that we both care about, and things we think are missing right now in terms of the debate around what we do with the surplus.”

Blair Miller is a reporter based in Helena. The Daily Montanan is a nonprofit newsroom. To read the article as originally published, click here.