About four years ago, Josh Kendrick, the CEO of local disability services non-profit Opportunity Resources, Inc., began noticing a troubling trend during the organization’s management meetings. For about three weeks in a row, Opportunity had lost staff because of the rising cost of living. Already, the organization was worried about finding support for the disabled adults it serves. Now, it was struggling to find places for that support to live — not to mention the organization’s clients themselves.
“That’s what started this whole conversation,” Kendrick said Thursday before he joined Missoula Mayor Andrea Davis and other officials in plunging golden shovels into a mound of dirt at an old industrial site at South Third and Ash streets in the Riverfront neighborhood. “How can we as Opportunity be part of the solution to housing in Missoula? And how can we keep our amazing direct-support professionals in Missoula?”
The answer to that inquiry is Opportunity Place, a mixed-use project backed by the city’s redevelopment authority that is slated to bring 24 income-restricted housing units to the market next year. Each of the units will be adaptable for use by adults with disabilities, and eight will be fully accessible, with 42-inch doorframes and open floor plans.
“How can we as Opportunity be part of the solution to housing in Missoula? And how can we keep our amazing direct-support professionals in Missoula?”
And in addition to the apartments, the project will include more than 3,000 square feet of commercial space, part of which will be used to house a gallery displaying work from artists with disabilities in ORI’s network.
“So we’ve got economic development, housing development — this project, we like to say that it has all the good feels,” Mike Bouchee, one of the developers of the property, told the crowd at the project’s groundbreaking Thursday.
Opportunity Place will be built at the site of a wood products facility that once employed Opportunity Resource’s clients. The wood products business — no longer as reliable an economic driver as it once was — is being sold and moved to another site in town, preserving the jobs. In its place, new houses — and not luxury condos either. These units are restricted to those making 40 to 80 percent of the area median income, a designation that will last for 50 years. That guarantee is “critical,” Davis said Thursday.
“I want to thank you as the residents of Missoula for supporting that, because ultimately it’s your investment into properties like this that can make it happen,” she said.
In a roundabout way, everyday Missoulians are indeed invested in the project. Opportunity Place is made possible through a patchwork of local and federal affordable housing funding and support. This includes almost $2.5 million in tax-increment financing, a sum that the Missoula Redevelopment Agency approved last summer.
“We hear regularly from employers that their employees are having a hard time finding housing in the Missoula market,” Annie Gorski, deputy director of MRA, said at an agency meeting last year, as reported by the Missoula Current. “This will help meet that need.”
That $2.5 million comes in two chunks. Just shy of a million can be used for deconstruction at the site and infrastructure improvements — new, underground utility lines, for example. That’s the standard purview of the MRA when it decides to invest in projects with a potential public benefit. But the remaining $1.5 million will be used to actually help build the housing itself. Not so long ago, this wouldn’t be an allowed use. But in 2021, the Montana Legislature changed the list of allowable TIF expenditures to include workforce housing by classifying it as infrastructure.
“It was the TIF funding that allowed us to clear the site and prepare it for this project,” Bouchee said. “It is the TIF funding that will be constructing many of the public improvements, sidewalks and so forth. But more importantly, Missoula is so forward-thinking and progressive that they immediately recognized an opportunity when the state legislature changed the definition of allowable uses of TIF funding. … You can put that money into bricks and mortar. So the city awarded us a significant TIF award to go into building these workforce housing units and absolutely making this project a reality.”
But it takes a village to build an $11 million housing development, especially one that promises affordability. In addition to the TIF funding (and private bank loans), the project is receiving support from the brownfields cleanup fund plus a 9 percent low-income housing tax credit from the Montana Board of Housing.
That last chunk was never certain. Federal housing tax credits are allocated by local housing authorities, and the process is highly competitive. Opportunity Place was awarded the tax credits last November, the final piece in a complicated funding puzzle. The credit works out to about $6.5 million over a decade.
The process for getting this project off the ground just shows how challenging building affordable housing is. Losing any one piece of the funding puzzle would have seriously jeopardized the project, or at the very least affected what kind of affordable housing it could offer. Without the TIF funding there would have been a significant “feasibility gap,” Bouchee said.
At the same time, Kendrick, with ORI, said he sees these kinds of private-public partnerships as the future.
“I think we’re gonna continue to struggle with staffing and we’re gonna continue to struggle with housing,” he said. “But with partnerships like this, I think private partnerships are gonna be the future of hopefully coming to a solution to this problem.”
This is the second city-financed workforce housing project in the city’s portfolio. Like Opportunity Place, the Scott Street-Ravara development is also replacing an old wood products facility. But it’s designed for would-be homeowners: 89 units will be placed in a community land trust, with more than half income restricted. Construction at the site is ongoing.
Davis said the push for more affordable housing in Missoula is an ongoing one centered around the city’s code reform effort. In the meantime, though, she said that projects like Opportunity Place and Scott Street-Ravara set the precedent for the private sector to invest in affordability.
“While we continue to work on much larger opportunities and challenges in front of us, as we get code reform wrapped up and underway, well, the private sector can respond to properties like this and bring more, more mixed-use opportunities to our community,” she said. “When we can invest both in the infrastructure and the workforce housing, in order to know that this will be affordable for years to come — for generations to come — is very critical.”
