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Pehan said adjusting development fees has been a topic of discussion in the past, but the city’s focus on finding solutions to the affordable housing crisis has brought it to the fore.
“The continued rise in the cost of single-family homes makes it imperative to address this as soon as possible,” said Pehan.
Lengthy review procedures make construction more expensive, Pehan said. Holding costs – the interest paid on money borrowed to fund a project – can cost developers thousands of dollars.
Pehan said the proposal received “fairly unanimous” support from the Missoula development community, with whom city officials have worked closely. The fee could lower development costs, resulting in lower costs for buyers and tenants.
“Believe it or not, I actually support the fee increases because we have them tied to specific schedules. Time is more important than a 15% increase,” Ryan Frey, owner of Saddle Mountain Construction, Missoula, said in a public Comment to the committee. “We have high hopes for this plan.”
If the proposal is passed, two new planners, a review engineer, a Parks and Trails planner and a senior legislative reform planner will be added to the city staff. The fee will provide the money for these positions, which means their compensation does not come from the general city budget.