By Martin Kidston

When the Missoula Organization of Realtors unveiled its latest housing report this year, the annual graph showing the steady creep in housing costs had reached a new high, pegging out at nearly $240,000.

While the figure proved alarming, it wasn't completely unexpected. Simply put, Missoula is suffering from a housing shortage, and Mayor John Engen believes it's time to do something about it before prices lead to widespread economic eviction.

“There's an affordability gap, and some of that is a function of inventory,” Engen said. “What we see in communities that are not unlike Missoula – places that are attractive to live – they become too expensive for working folks to live in. I do not want to become Boulder, Colorado, where the medium home price is around $700,000.”

Missoula Mayor John Engen

Last week, Engen unveiled his plans to establish a housing office, taking the first step in creating and executing a needed housing policy. As envisioned, the plan would establish a dedicated team to chase down grants, arrange for public-private partnerships and implement a strategy based upon need.

In an interview with the Missoula Current this week, the mayor added detail to his vision, noting the plan will continue to evolve as the pieces fall into place. Without affordable housing, he believes, Missoula will fail to reach its potential as an emerging city.

“We've had great partners over the years in the nonprofit housing community, but they're scrambling for the same resources,” Engen said. “The work they do, which is pretty terrific, is still not closing the gab. We need to find out ways to close that gap and grow the pie and provide more resources.”

Engen first mentioned his desire to create a housing policy in January, though he admits the need has lingered for years. He has since discussed the issue with members of the City Council and other community members, including those versed in housing and construction.

“As I began talking about this, it became very clear that we needed a municipal structure that made some sense, and we needed to think about resources differently,” Engen said. “Fundamentally, we have to have a plan, and we have to have policies, and we've got to have a champion – someone to drive the train.”

The mayor has found that champion in Eran Fowler Pehan, the executive director of the Poverello Center, which serves the city's homeless population. Of all her skills, Engen finds value in Pehan's knowledge of the grant system, particularly that dealing with the U.S. Department of Housing and Urban Development.

“Their model is changing, and their interest is all about this collective impact rather than this notion of simply applying a band-aid to the symptom,” Engen said. “There are some rewards in the system for that, and there will be winners and losers as a result. I want Missoula to be one of the winners.”

Seated in her office Friday, Pehan discussed her new role as the city's housing director, a position she'll assume this July. She agreed with Engen regarding the changing landscape of federal grants, whether they come from HUD, the Department of Justice or the Department of Veterans Affairs.

Money is harder to come by and grant recipients must show progress in resolving the overall problem, she said.

“Nationwide, we're seeing a tremendous shift in funding from an allocation-type grant to really merit-based, outcome-focused grants,” Pehan said. “Doing good work, unfortunately, isn't enough to get funded anymore. Those funding sources want to see tangible outcomes.”

Pehan said she'll look to the city's housing experts to learn more about Missoula's needs and opportunities. The Garden City isn't alone in its struggle to provide adequate housing, she said, and other forward-thinking communities have found unique tools to address the challenge.

“It's a call to action in a lot of ways,” Pehan said. “We cannot continue to operate business as usual. That's the challenge facing Missoula and our nonprofits. How we can position ourselves to benefit from the shifts in federal funding to bring these monies back to our community and serve as a model statewide and nationwide.”

Engen said the city's changing demographics add to the challenge, though they also bring unique opportunities. Aging Baby Boomers are looking to simplify, though not necessarily downsize. Extra rooms for visiting grandchildren remain an expectation, even in condo living. Urban living near services and retail opportunities has also grown in demand.

Future housing efforts could see an increased focus on public-private partnerships, like plans being proposed near Southgate Mall.

When Engen talks about the issue, he's not just referring to low-income housing stock, though that's also part of the mix. Creating opportunities for workforce housing will also play in future discussions regarding efforts to boost the city's housing supply.

“We have real opportunities, particularly in our redevelopment districts and the Brooks Street corridor to bring planning, money and mixed income stuff together so we have a lot more opportunity, and lot more variety,” Engen said. “Some of this is just having a lot more options for people to chose from.”

For that, Engen has turned to Ellen Buchanan, the executive director of the Missoula Redevelopment Agency. Buchanan will serve a the deputy CAO of Redevelopment, Housing and Economic Development.

Engen believes MRA is uniquely positioned to bring public-private opportunities to the table.

“MRA's Board of Directors has long been interested in housing, and certainly MRA has assisted the redevelopment districts that it serves,” Engen said. “Like me, that board wants to be intentional. They want to create projects rather than react to projects, and that's what we've been doing.”

Daniel Kemmis, a member of MRA's Board of Directors, said the agency has worked to address housing for years, though it has become more focused on serving as a resource for affordable housing.

He described the effort as a steady continuum, one that will likely gain momentum in the coming months and years.

“We're trying to become more focused and more effective in steering tax-increment resources into affordable housing opportunities,” Kemmis said. “With the mayor's encouragement, the board is going to continue deliberately along that avenue.”

Contact reporter Martin Kidston at