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On November 4, Bozeman voters will see a ballot question related to water and residential development on their ballot. The WARDcitizenspecial interest group initiative would change the city of Bozeman’s development code, requiring developers of three or more residential units to pay cash-in-lieu of water rights to the city only if the development designates33% or more of the units as affordable. If the developer does not include 33% affordable units, they are responsible for securing water rights, which, because of state water rights processes, could take 5-8 years. The WARD initiative also removes the ability for developers to meet the water demand of their development through off-site water efficiency or conservation measures.Check out the full description of the initiative.The Initiative was notdeveloped by the City of Bozeman. The City is, however, providing educational information on the Initiative.
Get the Facts on Our Water and Housing:
Since 2022, we have 1777 affordable units built, under construction, or in the pipeline
Since 2022, $120M has been spent in subsidies on those projects
Bozeman residents continue to excel in water conservation, using 188 gallons of water per household per day compared to 314 GPHD in other arid Western states
Get the Facts on Our Water:
Bozeman is not at risk of running out of water. When new housing is proposed, the city ensures there is enough water to support it. Based on the 2024 water use numbers, in a normal water year, the city only uses about 43% of its available supply, and even in a drought year, that number rises to just 60%. Bozeman’s water comes from three main sources—Lyman Spring, Bozeman Creek, and Hyalite Creek, with the Hyalite Reservoir.
To carefully manage demand, the city uses a Water Supply & Optimization Tool that monitors current usage, projects future needs, and tracks available resources. This tool is critical to ensure the city continues to develop new supplies to meet the needs of our growing community. New water supplies are being developed as prioritized in the City’s Integrated Water Resources Plan.In addition, Bozeman continues to strengthen its long-term water sustainability by developing new conservation measures and following its2023 Water Conservation Plan.
Get the Facts on Affordable Housing:
Building affordable housing is costly because of rising land, labor, material, and lending expenses. A city study found that developers can typically only make about 5% of their units affordable, as higher percentages aren’t financially viable.
To address this, the city is partnering with public, private, and nonprofit organizations and shaping policies based on local data and community input to balance affordability, growth, and neighborhood character.
Get the Facts on the Impacts of the WARD Initiative:
The WARD Initiative’s requirement that housing developments of three or more units ensure 33% of units in new developments are affordable in order to access the city’s cash-in-lieu of water rights could limit housing supply.
Even in housing projects that receive significant government subsidies,developers depend on a balance of market-rate and affordable units to cover construction costs. The result is that WARD’s high affordability requirement (33%)could make it harder for a developer to secure financing,resulting in less interest in building housing in the city. If developers choose not to build in Bozeman, demand for housing in the city may rise without the housing supply to match, driving up prices. Some may instead build in surrounding areas like the County, which could increase commuting and harm the environment.
Additional Information:
This website and related City efforts to educate voters on this initiative are not intended to advocate for or against the initiative; rather, the educational effort is to bring to light how the initiative will affect city operations, including how the City works to accommodate the development of new housing in our community and the City’s effort to provide our community the water it relies on.
We invite all to use our Question-and-Answer feature on this page to learn more.
On November 4, Bozeman voters will see a ballot question related to water and residential development on their ballot. The WARDcitizenspecial interest group initiative would change the city of Bozeman’s development code, requiring developers of three or more residential units to pay cash-in-lieu of water rights to the city only if the development designates33% or more of the units as affordable. If the developer does not include 33% affordable units, they are responsible for securing water rights, which, because of state water rights processes, could take 5-8 years. The WARD initiative also removes the ability for developers to meet the water demand of their development through off-site water efficiency or conservation measures.Check out the full description of the initiative.The Initiative was notdeveloped by the City of Bozeman. The City is, however, providing educational information on the Initiative.
Get the Facts on Our Water and Housing:
Since 2022, we have 1777 affordable units built, under construction, or in the pipeline
Since 2022, $120M has been spent in subsidies on those projects
Bozeman residents continue to excel in water conservation, using 188 gallons of water per household per day compared to 314 GPHD in other arid Western states
Get the Facts on Our Water:
Bozeman is not at risk of running out of water. When new housing is proposed, the city ensures there is enough water to support it. Based on the 2024 water use numbers, in a normal water year, the city only uses about 43% of its available supply, and even in a drought year, that number rises to just 60%. Bozeman’s water comes from three main sources—Lyman Spring, Bozeman Creek, and Hyalite Creek, with the Hyalite Reservoir.
To carefully manage demand, the city uses a Water Supply & Optimization Tool that monitors current usage, projects future needs, and tracks available resources. This tool is critical to ensure the city continues to develop new supplies to meet the needs of our growing community. New water supplies are being developed as prioritized in the City’s Integrated Water Resources Plan.In addition, Bozeman continues to strengthen its long-term water sustainability by developing new conservation measures and following its2023 Water Conservation Plan.
Get the Facts on Affordable Housing:
Building affordable housing is costly because of rising land, labor, material, and lending expenses. A city study found that developers can typically only make about 5% of their units affordable, as higher percentages aren’t financially viable.
To address this, the city is partnering with public, private, and nonprofit organizations and shaping policies based on local data and community input to balance affordability, growth, and neighborhood character.
Get the Facts on the Impacts of the WARD Initiative:
The WARD Initiative’s requirement that housing developments of three or more units ensure 33% of units in new developments are affordable in order to access the city’s cash-in-lieu of water rights could limit housing supply.
Even in housing projects that receive significant government subsidies,developers depend on a balance of market-rate and affordable units to cover construction costs. The result is that WARD’s high affordability requirement (33%)could make it harder for a developer to secure financing,resulting in less interest in building housing in the city. If developers choose not to build in Bozeman, demand for housing in the city may rise without the housing supply to match, driving up prices. Some may instead build in surrounding areas like the County, which could increase commuting and harm the environment.
Additional Information:
This website and related City efforts to educate voters on this initiative are not intended to advocate for or against the initiative; rather, the educational effort is to bring to light how the initiative will affect city operations, including how the City works to accommodate the development of new housing in our community and the City’s effort to provide our community the water it relies on.
We invite all to use our Question-and-Answer feature on this page to learn more.
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Over the past weeks, we’veheard concerns from residents about the messaging around water in our community. People have been told for several years that we are running out, and understandably, they are now concerned that our messaging has changed to one that sounds like we have plenty of supply. Truthfully, we are glad to have this conversation in our community so we can share more information about the City’s water supply.
One of the major reasons that the messaging has shifted is a success story; we have better data and information to look at our water future and have done great work with our water conservation programs and water supply development.
In years past, the City projected future water supply and demand using the best information available at that time. This inherently required that the City make assumptions about growth rates, available water supplies, and demands. To be conservative and responsible in its planning, the City used a worst-case scenario projection that assumed: 4% continuous annual growth, no demand reductions from water conservation, no additional supply, and very significant impacts from climate change. While a valid approach, this projection was rudimentary, static in nature, and included highly conservative assumptions.
To improve our ability to manage our water supply in the face of growth, the Citydeveloped a water supply and optimization tool. This tool, which the Citycompleted and began using in 2023,supports a more sophisticated and accuratewater supply and demand projection. The tool evaluates the City’s legal and reliable water supply on a monthly basisalongside existing demands and projecteddemands associated with approved development projects. The tool puts a placeholder on water for new development as projects are approved and prior to being built. It evaluates future demands based on a land use approach, not an assumed population growth rate. This has resulted in a more accuratewater management approach with fewer assumptions and still accounts for the impacts of climate changeon our water supplies.
Another major factor shifting the conversation was that we all rolled up our sleeves and got to work:Bozeman residents have taken conservation messages seriously and have worked hard to reduce the demand on our water supply, leaving us in a much better place.Bozeman is still very much drought-prone. We live in a closed basin, meaning that our water supply does have a limit to it, and good environmental stewardship means that we’re using this important resource wisely and planning for current and future needs.
Our growth rate now hovers at a manageable 1-2%. When our city was growing at the peak growth rates through the pandemic, as high as 6% at one point, we did have concerns about how fast we were allocating our supply. Now that growth is down to 1-2%, the supply lasts a lot longer.
We took those growth concerns seriously and enacted time/day watering restrictions. This not only helped ensure that people weren’t overwatering their lawns, but it also helped our Water Treatment Plant better plan for and manage the amount of water being treated and delivered to the community.
We also enacted landscaping standards, ensuring that no more than 20-35% of landscapes in new development projects can have turf, reducing water use and increasing the prevalence of native plants.
The City has continued to develop its water supply and acquire new water rights. As an example, we now irrigate the Sports Park and the cemetery with irrigation water rights and no longer pull that water from the City’s potable water system.
We have increased our rate of replacing old, leaky pipes to save water and ensure reliable water delivery to our customers.
The City is constantly striving to make better decisions; to improve, grow, and make the best-informed decisions possible for our future. Thank you to everyone for the questions and concerns around our water supply. Bozeman residents are the most sustainable water users in the state, and it’s because we all care about this important resource. We appreciate you taking the time to learn more and understand.
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A reminder that local ballots will be mailed by Gallatin County by October 17, so you can expect them in your mailbox after this date. This is an all-mail ballot – ballots must be returned by mail ordropped off at an official ballot drop-off location by November 4, Election Day. You can check the status of your voter registration by visiting voterportal.mt.gov.
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We just had two interesting presentations related to the WARD initiative at City Commission! Check out the recording here.
One Valley Community Foundation’s Regional Housing Coalition presented a policy analysis on WARD. Their findings can be found in the documents section of this website. Their report discusses the drivers of the high cost of housing, the likely impacts on Gallatin County, including environmental concerns around developing on wells and septic, and policies/tools that can be pursued to help create more affordable housing.
Headwaters Community Housing Trust presented results from a poll of 424 registered voters in Bozeman. Their poll looked at a number of issues, from WARD to UDC to housing solutions. Their methodology and memo on the results can be found in the documents section as well.
Thanks for tuning in and staying up to date on all things WARD!
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Still have questions on the water side of WARD? Learn more about the Water Adequacy for Residential Development initiative from Shawn Kohtz, our Utilities Director, in this video.
Shawn explains that we still have room to grow in our current water supply. And if a developer had to get a water right to develop, a process that takes at least 5-8 years with no guarantees, it may not be able to be used at our treatment facilities. That could lead to standalone water systems and an increase in staffing to manage those, which would be more costly to ratepayers.
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Sit down with David Fine, our Economic Development Manager, in this video and learn all about the housing side of WARD.
David explains the factors that go into the cost of building a home and why subsidies are a critical component in making affordable housing happen. Without subsidies, building affordable housing often doesn’t pencil out.
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The City of Bozeman recently retainedEconomic Planning Systems (EPS) to look at the Water Adequacy for Residential Development (WARD) initiative’s requirement that a residential development of three or more units seeking to meet its water demand using the City’s cash-in-lieu of water rights provide 33% of the homes at affordable rates. EPS’ analysis includes what the 33% requirement would do to a project attempting to be built in the current market.
According to the study, a 30-unit single-family home market-rate development without affordability requirements could make a 10% profit in today’s market. With WARD in effect, that same development may lose $25,000 per home, for a total loss of 4%. The model also looked at a 90-unit apartment complex. According to the report, such developments are not currently feasible in today’s market without affordability requirements, and WARD increases the funding needed to make a profit by $2.6 million.
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Heads up as we get closer to Election Day: as required by Montana law, the ballot contains a statement of purpose but does not contain the full text of the ordinance the initiative seeks to adopt. The text of the complete ordinance the initiative seeks can be found here. The ballot language is below:
"The Bozeman Water Adequacy Initiative amends 38.410.130.D of the Bozeman Municipal Code to allow development to pay cash-in-lieu of water rights only if the development provides 33% or more of the dwelling units as restricted by deed for 99 years or as long as the law allows and sold at 120% or less of area median income (AMI) or rented at 60% or less of AMI. This applies to all residential development of three units or more. The initiative also repeals the ability of residential development to satisfy its water adequacy requirements by implementing offsite water efficiency or conservation measures."
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For the past few weeks, Mayor Cunningham has issued a FYI on the WARD citizen initiative during the weekly Commission meetings. Each week, he shared information related to water and housing to help the public better understand these complex topics.