Calling it a model for future development, members of the Missoula City Council on Wednesday gave the mayor initial approval to sell 9 acres of city-owned property off Scott Street for a mixed-use project, including permanently affordable housing.

The development, which includes a collaboration between the city and Ravara LLC, will result in 70 units of permanently affordable housing built on a 3-acre land trust and 6 additional acres of market rate housing.

The 70 affordable units represent the largest permanently affordable land trust development in Montana. Once completed, it will essentially double what's currently available in that market in Missoula.

“We're realizing what we hope will be a game-changer for the community, the neighborhood and the City of Missoula,” said Mayor John Engen. “The partnership came together very quickly, and there was a lot of due diligence among the partners. This hits on all cylinders.”

Wednesday's authorization passed on 10 to 1 vote, with only council member Sandra Vasecka voting in opposition, saying she wasn't “totally convinced.” The final vote will take place on Monday night.

The project deploys a number of funding tools including tax increment financing, which will be used to design the project and lay the public infrastructure needed to accommodate neighborhood growth.

It also includes an opportunity zone investment by a Salt Lake City investor. Opportunity zones were established by the former Trump administration's 2017 tax package.

“What we get here for the sale of this property and our investment of infrastructure is a mixed used development with permanent affordability,” said Engen. “We'll be looking at the infrastructure that's necessary in that neighborhood to mitigate the impacts.”

Details on the final project won't be available until a design process plays out over the coming months. But as proposed on Wednesday, the vision includes 70 units of permanently affordable homes on 3 acres and market rate housing on the remaining 6 acres.

However, the affordable and market rate homes will be intermixed throughout the development, according to Dawn McGee, a member of the Ravara development team which includes Goodworks Ventures.

The project also includes a daycare project and a commercial component to include food and beverage options.

“We're looking to create a master plan that has the housing woven throughout the community, so there is no distinguishing what's affordable and what's market rate,” said McGee. “We recognize we don't have a vibrant community if we don't have a housing stock. It's just going to be a mixed-use development.”

The property proposed for sale includes roughly half the parcel outlined in blue on this map.
The property proposed for sale includes roughly half the parcel outlined in blue on this map.
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Ellen Buchanan, director of the Missoula Redevelopment Agency, said that once full authorization is given next week, MRA will engage Opticos Design, a national firm that specializes in designing neighborhoods for the “missing middle.”

The final design will also encompass the adjoining 10 acres of city property and Scott Street itself, where several sizable housing projects are underway. After a six-month planning and public process, the city will then sign a purchase and development agreement.

The property is set to close 180 days later, or sometime in July.

“We're moving at lightening speed on this to fill a dire need in our community right now,” said Buchanan. “One of the things we see as a real opportunity here is the ability to create a new model for how we provide housing, and how we maximize these sites.”

Known as land banking, the city has acquired a number of parcels around Missoula, including the Sleepy Inn, the MRL Triangle in Midtown and the downtown Payne Block. It also owns the Public Works building on West Broadway and was set on Wednesday to purchase two adjoining parcels.

The Scott Street deal will create a model moving forward in how public-private partnerships might work in Missoula. The sale of each city-owned parcel will help grow the city's Affordable Housing Trust Fund.

“These funds have the power to do multiple things,” said Eran Pehan, director of Community Planning, Development and Innovation. “We hope this is the first of many like projects.”

The city's Housing Policy recommends funding the Affordable Housing Trust Fund at a level that provides it the ability to loan or grant funds in the range of $1 million to $3 million annually.

The sale of the Scott Street property will infuse the fund with roughly $1.7 million, bringing its balance to $2.4 million when combined with the city's $750,000 contribution. The city is committed to providing another $100,000 this upcoming budget cycle.

Council member Heidi West, who lives just two blocks away form the proposed Scott Street development, praised the city's urban renewable districts, its planning process and diligence in getting such projects moving.

“It's a huge accomplishment that speaks to both our extensive internal planning and public processes we have in our community,” West said. “They create the foundation for us to move quickly when the opportunity arises.”

The 70 permanently affordable homes will be sold to buyers earning 120% of the Area Median Income, which is currently around $94,000 annually. The 70 units also brings the city's goal of providing 100 permanently affordable homes over five years to 77%.

https://missoulacurrent.com/business/2021/02/affordable-home-development/

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