City Council approves contract with consultants for housing policy proposal

Real estate signs dot a new subdivision under construction off Dore Lane on the south side of Missoula in early September. The city will contract an outside consulting firm to offer recommendations needed to complete a new housing policy. (Missoula Current file photo)

Citing the rising cost of home and rental prices, members of the Missoula City Council on Wednesday gave their unanimous approval to a contract with an outside consulting firm to develop recommendations for a future housing policy.

The $33,900 contract with Werwrath Associates follows less than a year after the city’s Department of Housing and Community Development formed a steering committee to look at the issue, marking the first phase of developing a polished housing policy.

Eran Pehan, director of Housing and Community Development, said Werwrath Associates was the logical choice to prepare a panel of recommendations to the city, given how the firm recently prepared and presented a gaps and needs analysis on housing in Missoula in January.

“We believe they bring cost savings and efficiency, and expertise that an additional consultant wouldn’t have at this stage,” Pehan said. “Werwrath is going to be able to complete this work by the beginning of December. They’re coming in front-loaded with all that knowledge.”

Under the scope of work approved Wednesday by the City Council’s Admin and Finance Committee, the firm will recommend ways to incentivize affordable home construction, and it will look at affordable housing trends and projections.

It will also explore a funding mechanism to guide any future housing investment by the city, and look at entrepreneurial models for housing development to reduce the need for outside subsidies.

“The contract will provide our office with the resources and expertise required to bring forth that formal policy commendation,” said Pehan. “They can begin to fulfill the scope of services immediately to begin planning housing policy services.”

The full City Council is expected to sign off on the contract on Monday.

The gaps and needs analysis presented by Daniel Werwrath in January offered a deep look at economic trends, demographics and general issues around affordability in Missoula.

According to the study, sales of all homes priced under $200,000 decreased 40 percent between 2007 and 2016, while detached homes listed below $200,000 decreased 46 percent over the last two years.

Given the cost of housing, the rate of home ownership in Missoula remains 19 percent below the state average, and 16 percent below the national average, the study added. The vacancy rate for rentals remains tight while 41 percent of Missoula households spend more than 30 percent of their income on rent.

A survey completed with the study also found that 92 percent believe local government should provide incentives for developers to build affordable housing.

“We’re specifically contracting them (Werwrath) for their research and policy development expertise,” Pehan said. “A lot of that will be the behind-the-scenes work they provide our technical working groups. We know internally what we’re going to focus on outside of that.”

Bozeman also completed a gaps and needs analysis, though Missoula City Council member Heidi West said the results were less than satisfying.

“I’ve heard some criticism from the Bozeman policy,” she said. “Because they (Werwrath) were instrumental in the gaps and needs assessment in Bozeman, I’m curious what sort of needs they found there that could be applicable here, so we don’t repeat the same shortcomings.”

Pehan suggested those shortcomings weren’t the fault of the consultant, but were missing from the original scope of work. She said Werwrath’s contract with Missoula covers all bases.

“We focus on that heavily and in defense of all contractors out there, they complete the work they’re asked to complete in the scope of work,” Pehan said. “When we look at the Bozeman plan and see pieces missing, it’s important to remember they weren’t likely contracted to complete those portions or to do the outreach.”