BOZEMAN – The Bozeman City Commission voted unanimously on two actions to support 155 units of workforce housing in Bozeman. The Lumberyard project combines 155 units of workforce housing with 285 units of market-rate rentals in a mixed-income project. The workforce units will be restricted for at least 50 years at rents deemed affordable for households making 60% of the area median income (AMI) or $1,420 a month for a two-bedroom unit at today’s AMI.

The Bozeman City Commission voted to provide up to $7.5 million in reimbursement for eligible costs of public infrastructure using tax increment financing (TIF). With TIF, a developer finances all the cost of new public infrastructure that is necessary for a project and is reimbursed with new tax revenue generated by the project. The assistance makes projects feasible that would not be feasible but for TIF assistance – like workforce housing projects.

Bozeman’s City Commission also provided a $1 million grant to the newly created Gallatin Community Housing Impact Fund managed by NeighborWorks Montana (NWMT). The Fund will provide gap financing that makes workforce housing projects feasible throughout Gallatin County. The grant agreement requires that at least $1 million from the Fund must be invested in projects within the Bozeman city limits. NWMT provided a commitment letter to Reuter Walton Development for $2.5 million contingent on closing City and investor dollars into the fund. The gap financing from the Fund, combined with the commitment of TIF funds from the City will make the 155-unit workforce housing project feasible.

Bozeman-based Virga Capital is the developer of The Lumberyard project and is financing the public infrastructure and constructing the market-rate housing. “We are thrilled to be partnering with the City of Bozeman and Reuter Walton Development on delivering desperately needed workforce housing,” said Rob Lateiner, CEO of Virga Capital. “Without the City of Bozeman’s leadership in providing tax increment financing assistance, this project would not be possible.”

Reuter Walton Development is building the 155 units of rent-restricted workforce housing utilizing low-income housing tax credits (LIHTC). “The Gallatin Community Housing Impact Fund is making our 155-unit affordable housing project feasible,” said Nick Walton, founder, and CEO of Reuter Walton Development. “LIHTC is an underutilized source of funds in the Bozeman market because projects are often infeasible due to high construction costs. With the City’s seed investment in the Fund, we can pair federal and local resources to provide essential affordable housing for the Community.”

NeighborWorks Montana is managing the Gallatin Community Housing Impact Fund. Other committed investors in the Fund include First Security Bank, Stockman Bank, Opportunity Bank, American Bank, Bank of Bozeman, and Clearwater Credit Union.

Those seeking more information on the project can reach out to David Fine at dfine@bozeman.net.