Affordable Housing Ordinance

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The City Commission adopted the current Affordable Housing Ordinance (AHO), found in Division 38.380 of the municipal code, on September 27, 2022, in response to State legislative action. In 2021, the Montana Legislature passed House Bill 259, which prevents the City from requiring affordable housing in new developments. Since many other tools used to create affordable housing are also prohibited in Montana, the City turned to voluntary incentives to encourage developers to build affordable homes. The current AHO is a response to this policy context.

To develop the current AHO, the City conducted an extensive review of the existing code, identified alternatives, and chose those that would best encourage the construction of new affordable housing. So far, the ordinance has created 387 affordable units with 1,079 more in the project pipeline across 15 projects.

In July 2024, the City Commission asked staff to propose revisions to the AHO, which fall into three categories:

  1. Administrative changes to provide clarity in its application.
  2. Enhancements to better incentivize the voluntary creation of new affordable housing units.
  3. Amend or remove the deep incentives in response to current market conditions and substantial public feedback.

The AHO includes two areas of incentivization known as the “shallow” and “deep” incentives, each option requiring a number of units to be set at a certain Area Median Income (AMI) in exchange for defined code relaxations. Over the next few months, we will be consulting with the public and City boards to evaluate alternatives and share their priorities. We appreciate your engagement on this critical topic for Bozeman!

The City Commission adopted the current Affordable Housing Ordinance (AHO), found in Division 38.380 of the municipal code, on September 27, 2022, in response to State legislative action. In 2021, the Montana Legislature passed House Bill 259, which prevents the City from requiring affordable housing in new developments. Since many other tools used to create affordable housing are also prohibited in Montana, the City turned to voluntary incentives to encourage developers to build affordable homes. The current AHO is a response to this policy context.

To develop the current AHO, the City conducted an extensive review of the existing code, identified alternatives, and chose those that would best encourage the construction of new affordable housing. So far, the ordinance has created 387 affordable units with 1,079 more in the project pipeline across 15 projects.

In July 2024, the City Commission asked staff to propose revisions to the AHO, which fall into three categories:

  1. Administrative changes to provide clarity in its application.
  2. Enhancements to better incentivize the voluntary creation of new affordable housing units.
  3. Amend or remove the deep incentives in response to current market conditions and substantial public feedback.

The AHO includes two areas of incentivization known as the “shallow” and “deep” incentives, each option requiring a number of units to be set at a certain Area Median Income (AMI) in exchange for defined code relaxations. Over the next few months, we will be consulting with the public and City boards to evaluate alternatives and share their priorities. We appreciate your engagement on this critical topic for Bozeman!

  • Jan 28 Commission Meeting Recap

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    On January 28 (link to meeting recording), the City Commission reviewed the draft Affordable Housing Ordinance (AHO). With input from public comment and city boards, Commission made several amendments to the draft ordinance and directed staff to return with language reflecting those changes. The final draft will return to Commission for a vote on February 11 (link to meeting agenda).

    The following summary reflects the amendments directed by Commission:

    Sec. 38.380.030.F.

    • Utilization of the Type B and C incentives now includes a requirement for the developer to hold a preapplication community meeting. A notice for the meeting must be mailed to owners of all property and all mail addresses withing a 200-foot radius of the proposed development. If the development is located within a city recognized neighborhood association, the developer must provide written notice of the meeting to the presiding officer of the applicable neighborhood association, to the city neighborhood liaison, and to the chair of the inter-neighborhood council. This amendment is located on pages 11 and 12 of the Ordinance.

    Sec. 38.380.040 Incentives

    • All minimum ADA spaces must be located on the same site as the dwellings.
    • The Type A Incentives for multi-household dwellings are amended to only allow for one additional story of height in R-3 if the proposed building has four or fewer total dwellings.
    • No height in incentives in R-S, R-1, R-2, and RMH.
    • Adds M-1 to the list of height incentives, where it was previously omitted.
    • For the Type C incentives, only one (1) additional story of height is available in R-3 and R-4.
    • For the Type C incentives, no more than two (2) additional stories of height are available in R-5, R-O, REMU, B-1, B-2, B-2M, B-3, and UMU.
    • For the Type C incentives, the minimum parking requirement is increased to 0.75 spaces per dwelling.

    Sec. 38.380.050 – Development Standards for Affordable Dwellings

    • Subsection D is amended to read:
      • Access to shared amenities, including parking, by residents of the affordable dwellings must be the same as those in market-rate dwellings in the development. For amenities other than parking, the cost of any such amenity must be included in the required affordable rental rate.


  • Draft Ordinance

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    The draft Affordable Housing Ordinance is now available online. The public comment period for the Commission hearing on January 28 is now open as well. Please submit any written public comments to comments@bozeman.net and they will be considered in the draft and by the City Commission.

    A reminder as well that Community Development Board will be meeting and reviewing the draft ordinance on January 13. For full meeting details including how to join remotely, visit our website.

    Thanks again for all of the input, and please be sure to attend meetings in person if you can or submit your written comments before Jan. 28!

  • Survey results are posted

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    The AHO survey is officially closed and the results are now available in the Resource Documents section of this page. If you are interested, please take the time to review the Survey Results and Graphs, as well as all the feedback we receive at the Open House.

    As a reminder, the ordinance will be discussed at the Economic Vitality Board meeting tonight at 6:00 p.m. at City Hall. Feel free to attend!


  • Next steps

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    Thank you for taking the time out of your busy schedules to engage with us last night at the open house. As requested, the display boards and slide deck from the event are uploaded in the Resource Documents section. Feel free to review and send us your questions and feedback!

    The next step is for staff to bring the ordinance to the Economic Vitality Board on December 4 from 6:00-8:00 p.m. at City Hall. You are welcome to attend to listen to the discussion and give public comment.

    And as a reminder, the AHO Community Engagement Survey is open and collecting feedback until December 1.

  • Survey is live!

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    The Affordable Housing Ordinance Community Engagement Survey is officially live! Your feedback is incredibly valuable to us, and we want to hear about your priorities on housing affordability in Bozeman. Please take a few minutes to share your thoughts and complete by December 1.

    The City of Bozeman strives to ensure its surveys are inclusive and accessible. If you need access to this survey in an alternative format or need assistance with completing this survey, please contact the City of Bozeman ADA Coordinator by phone at 406-582-3232 or by email at darnado@bozeman.net.

  • Engage with us!

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    We are kicking off this engagement with an Open House on Thursday, November 21 from 4:00-7:00 p.m. at Fire Station 3, 1705 Vaquero Pkwy. The goal for the evening is to consult with you using interactive exercises to better understand your priorities for the updated AHO. See you then!

    If you can't meet in person, we'll also have a survey available for you to share your input. Sign up for updates to be notified when the survey opens!

Page last updated: 10 Feb 2025, 09:12 AM