A tool to safeguard public funding for housing projects

“Use the right tool, for the right job, in the right way.” It’s a motto good craftsmen, mechanics and chefs swear by.  

Try loosening a rusty bolt with pliers, when you really need a socket wrench and WD-40. Or try using a meat cleaver to trim a kiwi, when you really need a peeler. 

Kalispell city councilors should heed that advice as they consider an update to its Downtown Urban Renewal Plan that would make workforce housing developments eligible for tax increment finance funding. 

Tax increment financing is public money that can be used to address blight and spur economic development that, in turn, benefits the greater city. For example, the Council in 2022 approved $7 million TIF funding for a parking garage associated with a proposed downtown hotel. 

Two years ago, the council considered an option to include workforce housing in its urban renewal plan but ended up shelving the proposal indefinitely. When discussing the proposal in 2022, councilors pointed out that developers could already apply for TIF funds for infrastructure, thus reducing housing costs. Adding a workforce housing clause was unnecessary. 

Since then, however, the Legislature has defined workforce housing as serving individuals and families making between 60% and 140% of the area median income. Having state-determined parameters on what “workforce housing” means now allows the city to add language in its urban renewal plans that would ensure that a developer who receives TIF funding to build workforce housing, keeps the units affordable.  

In short, it allows the city to hold the developer accountable and safeguard public funding for its intended use. 

In considering Councilor Chad Graham’s concerns about whether workforce housing is an appropriate use of TIF, it should be noted that the Council awards these public funds at its discretion. It has the final say on whether a project meets the criteria of blight and community benefit — whether that’s a commercial center, a boutique hotel or a vital housing development. 

While currently there isn’t a line of developers at City Hall clamoring for TIF funds to build workforce housing, if the opportunity arises — and it surely will — the city should be ready with the right tool for the right job.