Missoula City Council approves interim rules for Townhome Exemption Developments

Missoula Mayor John Engen

Missoula has pioneered the use of Townhome Exemption Developments since they were approved by the Montana Legislature in 2011, but that effort has led to “a tiny bit of chaos,” Mayor John Engen said Monday night.

So the city, with the City Council’s blessing, is slowing things down for six months while planners clarify the regulations governing large townhome developments.

During that time, an interim zoning ordinance – approved on an 8-1 vote Monday night – will be in effect.

Townhome Exemption Developments will continue to move through the review and approval process, city planners emphasized.

From left, Councilwomen Mirtha Becerra, Gwen Jones and Julie Merritt.

Councilwoman Gwen Jones said her goal is to “have livable housing that also stands the test of time – that’s still in good shape after two decades.”

The mere fact that some proposed TEDs have taken so long to approve (when they’re intended for expedited review) “speaks to the fact that the process is not working well and needs to be addressed,” Jones said.

But there is no moratorium in effect, Councilman John DiBari said, and no back-pedaling on the city’s commitment to Townhome Exemption Developments.

“The time spent on this issue shows our commitment to keeping TEDs as a viable option in this community,” he said. “We are trying to assure ourselves that we have the information needed to make educated decisions. This is the prudent and smart thing to do.”

Councilwoman Heather Harp attributed the need for an urgent interim ordinance to “’growing pains.”

The Montana Legislature only conceived of and approved Townhome Exemption Developments eight years ago, and Missoula is the only city that has brought a significant number of those developments to fruition.

In that time, though, the proposed developments have changed dramatically, said Laval Means, planning division manager for Missoula’s Development Services.

The Legislature was trying to make it easier to finance condominiums and townhomes.

Shortly after HB460 passed, developers in Missoula began to propose small residential projects of 2-6 units using the exemption from subdivision review. In TEDs, “individual homebuyers own their residential units and the land beneath and an association owns and maintains the common areas.”

Missoula’s first Townhome Exemption Developments were infill projects that took advantage of existing road networks and infrastructure.

“The city of Missoula accommodated and even encouraged TEDs as a legitimate and cost-effective alternative to minor subdivisions,” she said.

“More recently, much larger TED projects have been initiated like The Aspens in the Franklin to the Fort neighborhood (56 units), Hellgate Gardens off Siren’s Road (36 units) and Koly Court Townhomes (31 units) off Grove Street just west of North Reserve Street,” Means explained. “These larger projects contained more private streets and more common areas to be owned and maintained by the association, but they still fit into the existing urban fabric.”

Hillview Crossing

Since 2018, the City Council’s Land Use and Planning Committee has reviewed the Hillview Crossing TED project (68 units). It remains in limbo because of environmental and road issues, but will not be affected by the interim zoning ordinance because it’s so far along in the process.

Here’s what happened, though, Means said. “In the past few months, a next generation of TED projects have been proposed to Development Services staff – very large projects on greenfield sites that are currently void of a collector street network and infrastructure.

“The size, complexity and location of these proposed projects, combined with some developers’ legal counsel opinions … has prompted staff to request to take the time needed to research and propose a balanced package of code amendments.”

Ward 4’s Jesse Ramos, though, begged his fellow City Council members to vote against the interim zoning regulations and rewrite of regulations governing TEDs.

Ward 4 Councilman Jesse Ramos

“Please, please vote this down,” he said. “The emergency is our need for affordable housing. Stop wasting our time on this.”

Approving interim, and later permanent, regulations governing Townhome Exemption Developments will further drive up the cost of housing in Missoula, to Ramos’ thinking.

“Don’t be fooled,” he said. “This in no way creates affordable housing or helps alleviate our affordable housing crisis. We need less regulations, not more.”

Dwight Easton, public affairs director for the Missoula Organization of Realtors, also urged a “no” vote Monday night.

“Considerable time, energy and capital has been invested in numerous housing projects throughout the city that will be adversely impacted by the proposed interim urgency zoning measure,” Easton said. “Dissatisfaction with the current rules is not a reason to adopt this as an emergency ruling.”

Most of the council disagreed with Easton and Ramos, though.

“It is absolutely a fact that everyone on this council is acutely aware of the price of housing in Missoula,” said Councilman Jordan Hess. “It’s entirely reasonable to take a step back and address how these developments can occur.”

Do not, he told Ramos, conflate “the orderly development of our city” with the effort to provide affordable housing.

Furthermore, Hess said, to say the urgent interim zoning ordinance is an “overreach” of government “is a complete farce. It is not.”

Mayor Engen, in a rare entry into the council’s discussion, said he had to be convinced that there was need for an emergency ordinance. When city planners made their presentation, he became a believer.

As approved Monday, the interim zoning ordinance expires in November. In the meantime, it affects only the largest “and potentially most impactful” TED projects, Means said.

It will not affect projects of nine or less units. Nor will it affect larger Townhome Exemption Developments proposed on lots that have no resource constraints, are being built using an existing transportation network, and are likely to be fully developed in a short amount of time.

“In other words,” she said, “the interim ordinance would not affect projects that intend to support the orderly and beneficial development of the city and enhance public health, safety and welfare.”

The interim zoning ordinance clarifies the review and approval procedures for conditional use TED projects.

Said Means: “This includes interim regulations related to submittal information for areas where hazardous lands may be present and the need to review, accept, approve and potentially condition development based on the outcomes of that information; a clear expectation of timing, sequencing, and lapse of approval; and restrictions on development within flood-prone areas.”

Yet to come are the proposed long-term ordinance changes, which will be written following discussions with Missoula-area builders, local officials and private citizens.