Housing project advances toward $6.5M award

By Bella Butler EBS STAFF

Editor’s note: This story ran in a recent issue of Explore Big Sky. The graphic in the print story reflects data from the Meadow Area. The graphic in this story reflects data from the Big Sky area.

BIG SKY – The Montana Board of Housing advanced the Big Sky Community Housing Trust’s application for a nearly $6.5 million award in federal tax credits at a May 25 meeting.

The Housing Trust, in collaboration with Lone Mountain Land Company, announced its new 24-unit workforce housing project, Riverview, on Jan. 19. LMLC purchased the future site of Riverview—the former American Bank building and adjacent lots that extend to the land across the road from Ace Hardware—and the housing trust is now seeking a 9 percent federal Low Income Housing Tax Credit award, distributed by the Montana Board of Housing, to fund approximately 65 percent of the project’s estimated budget of $9.8 million.

Big Sky Resort Area District has awarded the project $1.4 million of resort tax collections to the project. The Housing Trust has applied for a $500,000 resort tax award in the current allocation  for the project this year, and BSCHT Executive Director Laura Seyfang said forecasting indicates that they’ll ask for around $200,000 next year. The trust hopes to fund the remainder through philanthropy. 

The Housing Trust’s portion of the project is funded independently from LMLC’s units, so the tax credit and resort tax funding applies exclusively to the trust’s 24 units. Seyfang said though the project is a collaboration, this distinction is a solution to an important question: “How can we best attract appropriate dollars, and use them appropriately, but still create the most housing for workforce?” 

Seyfang presented the project to the housing board on May 24. The Riverview project was initially one of 12 projects seeking an invitation to apply. Following the presentations, the seven Montana Board of Housing board directors narrowed the pool down to eight applicants, who will submit full applications to be considered for one of the five or six awards granted in late fall.

The five board directors that spoke favorably of the Riverview project said they were impressed with the project’s collaboration, strong community support, leveraging of many resources and comprehensive, well-planned solutions. One director ranked Riverview in her top eight in part because of Big Sky’s “desperate need” for such a development.

Two directors did not rank Riverview among their top eight projects. “I really lean heavily in my choices on those projects that serve the lowest income levels,” said board director Robert Gauthier of Ronan, one of the directors who left Riverview off his list.

According to the Tax Policy Center, developers receiving the LIHTC must meet one of three income requirements: At least 20 percent of the project’s units are occupied by tenants with an income 50 percent or less of the area median income; at least 40 percent of the units are occupied by tenants with an income 60 percent or less of AMI; or at least 40 percent of the units are occupied by tenants with income averaging no more than 60 percent of AMI and no units are occupied by tenants with income greater than 80 percent AMI. 

A survey produced for the Housing Trust by an analyst out of Washington in January 2021 found that 124 households in the Big Sky area would be eligible for this LIHTC-regulated housing (Seyfang added that this number is likely higher as it doesn’t take into consideration commuters working in Big Sky). The analyst concluded that there is an annual need for 41 units for households with income at 50-80 percent AMI. 

Riverview, along with projects in Billings, Dillon, Hardin, Kalispell, Libby and two in Great Falls, was invited to move forward with a full application for the award. The Housing Trust and its partner, BlueLine Development, will make another presentation to the state housing board on Oct. 18. Seyfang says Blueline, a Missoula-based company that specializes in affordable housing consulting, will help guide the trust in how to use the tax credits and adhere to the regulations attached to them.

“These funds are crucial to the overall financial feasibility of the project …” Seyfang wrote in an email to EBS on May 26. “As an unincorporated community, we have restricted options for ways to finance the critical and expensive problem of lacking workforce housing. If we are not awarded these funds, the project will likely be delayed or not possible, in this expensive construction climate.”

The Housing Trust’s 2020 report states that the average wage earned in Big Sky is $17.83. Affordable rent and utilities earning this wage, or 30 percent of gross income before taxes, is $892 per month, according to the report. The average monthly rent and utilities cost in Big Sky is $1,050. Next to pricing, availability is a major issue. The same report shared that there are 145 rental applicants on the housing trust’s waitlist; in Big Sky and Bozeman, the trust reports 0 percent vacancy. 

Seyfang said public comment on the project is encouraged. 

Public comment on the Riverview project or other local housing issues can be sent to info@bigskyhousingtrust.com.