At a work session last week, Whitefish City Council heard from the Whitefish Housing Authority (WHA) and the city’s Housing Planner, Luke Sponable about potential changes to the Depot Park Townhomes project.

The project, located on the corner of Railway Street and Columbia Avenue, comprises 22 two-bedroom townhouse units that were originally 100% deed-restricted for affordable community housing. The original plan was to make the homes available to households earning 80% to 150% area median income (AMI). 

Based on 2022 HUD numbers for the Flathead Valley, 80% AMI is $63,000 for a family of four, and 150% AMI is $119,000. For a two-person household, 80% is $50,800 and 150% is 95,400.

In June 2020, the council resolved to donate the property, formerly known as the snow lot, to the Whitefish Housing Authority. Parties also signed a development agreement, which said the city would pay over $900,000 to the WHA. A year later, that sum was augmented to $2 million.

The WHA is now asking the council to consider increasing the range of household AMIs served by the project. They project a shortage of over $3 million for the original proposal due to rising interest rates and building costs.

The WHA offered three options. The first keeps funding as is but changes the AMI range served to 80% to 215% with an average of no more than 135%, from the original 80% to 150% with an average of 100%.

The second option is to sell the land to the Northwest Montana Community Land Trust to be permanently held in that trust. The associate executive director of the WHA, Marissa Getts, said the proceeds of the sale would help subsidize construction costs.

“This is an extremely normal mechanism for preserving housing affordability across the nation,” Getts said.

The third option is to stay the course, keep the average AMI at 100%, and expect a shortage of over $3 million.

“We’re not giving anybody any direction tonight,” Sweeney said. “This is, in my view, a sea change of what we told this community we could provide and what the Housing Authority told us they could provide.”

City Manager Dana Smith said when the city gave the land to the WHA, it was worth about $500,000. According to the 2023 tax appraisal, it was worth $1.9 million.

During the discussion of the land trust option, Trailview, a deed-restricted neighborhood, was mentioned, and it was quickly noted that Trailveiw is privately held property. 

The WHA noted that construction costs and real estate values have seen sharp increases since the agreement with the city was made in 2020. They said median home prices in Whitefish have doubled in the last three years while the valuation of townhome projects has tripled.

Another argument made by WHA for the change in AMI range is that the 2022 Whitefish Community Housing Roadmap states that home ownership options should focus on the 70% to 250% AMI range.

Deputy Mayor Frank Sweeney made it clear early that the council would provide no feedback to the WHA that evening. He said the mayor and the city manager would need to be consulted first.