Kalispell City Council to vote on using tax increment financing funds for workforce housing

Kalispell City Council on Monday is expected to decide whether to make workforce housing projects eligible for tax increment financing funds.

Council meets at 7 p.m., Oct. 7 in City Hall, 201 First Ave. E.  

To make workforce housing eligible for the funding, the city would have to amend the Downtown Plan and the West Side Urban Renewal/Core Area Plan, according to city documents. 

Council dusted off the proposal during a work session in September. Last discussed in October 2022, the proposal was shelved indefinitely at the time.  

The state Legislature defined workforce housing in the interim as serving individuals and families making between 60% and 140% of area median income. Prior to the state setting the parameters, city officials had determined that households making between 80% and 120% of area median income would be eligible for workforce housing. 

If Council were to adopt the state-defined range, then an amendment to the motion would have to be made, wrote City Manager Doug Russell in a memo.  

According to data from government-sponsored enterprise Fannie Mae, Kalispell’s area median income in 2024 was $88,400. Eighty percent would mean $70,720 and 120% would come out to $106,080. 

The discussion comes as municipalities across Montana — as well as the state government — grapple with a housing crunch.  

In the decade leading up to the 2020s, the U.S. Decennial Census data revealed a 6.2% increase in housing in Flathead County while the population grew by 14.8%.    

Flathead County’s ratio of monthly payment for housing to median household income in 2024 was around 70%, one of the highest in Montana, according to data from the University of Montana’s Bureau of Business and Economic Research.  

During the Sept. 9 work session, councilors questioned how necessary the amendment would be as developers can apply for tax increment financing funding for infrastructure, thus reducing housing costs.  

Development Services Director Jarod Nygren said during the meeting that added language in the urban renewal plans would ensure that the developer keeps the units affordable through a city-developer agreement. 

Councilor Chad Graham voiced skepticism of using the funds, which typically go toward addressing blight in underdeveloped areas. He suggested that the creation of a housing authority would be more appropriate.  

Councilor Ryan Hunter was a proponent for amending the plans to include workforce housing, recommending developers partner with nonprofits that specialize in keeping housing affordable. 

COUNCIL WILL also decide whether to enter into a renewed lease agreement with the Kalispell Golf Association.  

The association is nearing the end of its 20-year lease granted in 2009 and has approached the city with a new 30-year lease proposal, according to city documents.  

The new lease would allow the association to make property improvements of up to $75,000 without the city’s approval as well as change rates from up to 10% to up to 20%. Language in the new lease would also allow for a trail connection along U.S. 93 from U.S. 2 going north.  

During a work session discussing the proposed lease in August, Hunter voiced disapproval of the current arrangement, saying the golf association is using and maintaining the city’s infrastructure without paying to the city. 

140 acres of golf course land was provided to the city in 1938 and 1973 with the restriction that the property be used for golf course purposes, according to city documents. The golf association is responsible for funding the operation and managing the course. 

Council also is poised on Monday to confirm firefighter/paramedics Chris Albrecht and Will Watson. The pair have successfully completed their one-year probationary period.  

Jack Underhill can be reached at junderhill@dailyinterlake.com and 758-4407.