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Judge blocks Montana law curbing local control, sister to Wyoming bill

Measure would strip local governments of power to regulate construction and development of accessory residential units.

The Town of Jackson partnered with developers to build Flat Creek Apartments, a $27 million affordable rental project that will create 48 units. The complex is part of a community effort to address the affordable housing crunch in Teton County. (Angus M. Thuermer Jr./WyoFile)

by Angus M. Thuermer Jr., WyoFile

A judge has blocked a Montana law that grants homeowners there the right to build an accessory housing unit, even when doing so is prohibited by local regulation —  a law mirrored by a bill currently advancing in the Wyoming Legislature.

Central to both states’ measures is the question of local control: Should local or state governments have the power to regulate community development?

Montana District Judge Mike Salvagni enjoined Montana’s 2023 Senate File 528 shortly before it went into effect on Jan. 1, saying it would cause irreparable injury, according to numerous news outlets. The law stripped local zoning authority and made construction of accessory units on single-family lots an automatic right statewide in many cases.

“I think the state has to be careful here of giving the impression or taking the steps to say ‘We don’t find you capable of solving the issues in your community,’” JERIMIAH RIEMAN, WYOMING COUNTY COMMISSIONERS ASSOCIATION

A Wyoming legislative task force has recommended the Equality State pass a bill that mirrors the challenged Montana measure. Lawmakers circulated a working draft of “Accessory residential units — permits”

EditSign in anticipation it would be forwarded to a legislative committee, perhaps as soon as Feb. 6 when the Joint Appropriations Committee next meets.

The Wyoming bill would allow lot owners in many cases to construct an accessory residential unit up to 75% the size of an existing single family house. The proposal would prevent local governments from requiring additional parking, fees in lieu of parking, street improvements or imposing other conditions on a new unit.

Judge Salvagni’s preliminary injunction came in response to a suit filed by Montanans Against Irresponsible Densification. Residents in single-family neighborhoods formed the group to challenge the Legislature’s micromanagement of local zoning, the Bozeman Daily Chronicle reported.

The homeowners “dread waking up in the morning, with no notice, and a new, more dense, building is being erected in their family neighborhood,” the judge said, according to reporting by Missoula Current. The Montana attorney general appealed Salvagni’s “irreparable injury” ruling to the Montana Supreme Court on Jan. 11.

Wyoming’s version

Wyoming’s draft bill grew from the Legislature’s desire in March to address regulations that limit economic development in the minerals and agriculture sectors. The list of sectors to be insulated from regulation expanded when Freedom Path 307, a group that targets “leftist and socialist ideas,” proposed adding “residential, commercial and industrial construction” to the committee’s priorities.

Freedom Path’s Jessie Dafoe came to the March meeting armed with construction industry reports, other papers and statistics citing the increasing expense of housing. Automatic ARU permits would boost affordable housing and stimulate business, the group asserts.

Jackson Street Apartments, a $54 million low-income public housing project paid for by the Cumming Foundation and Teton County demonstrates a community effort to address the affordable housing shortage in Jackson (Angus M. Thuermer Jr./WyoFile)

The Legislature’s Management Council bought into the idea, despite a longstanding tenet of Wyoming and conservative philosophy that local governments are best suited to solve local problems.

“Do I want to broach on local control?” Management Council Co-chairman Sen. Ogden Driskill (R-Devils Tower) asked at the initial meeting. “No,” he said, “but we want to have them [local governments] be aware that they really should be friendly.

“I have no fear of looking locals in the eyes and if they’re abusing local control, say ‘Look, knock it off or be prepared for us to work on it.’”

Management Council created the Regulatory Reform Task force that in turn formed a housing subcommittee. That subcommittee heard from business leaders and Freedom Path, which suggested ARUs as part of a solution to rising housing costs, a solution that has its own critics.

As the housing task force met last year, local governments pushed back, warning that water, sewer and other services could be strained by an unplanned, automatic statewide increase in density.

Some Teton County landowners and developers upset with the Jackson Hole community’s zoning and building regulations chimed in. Some observers wondered whether lawmakers are again singling out County 22 as they did in 2019 when they wrested authority over the siting of private schools from local governments.

That successful maneuver by the late gubernatorial candidate and Republican megadonor Foster Friess is “Exhibit A” in the state’s efforts to impose its one-size-fits-all imprint on a unique county, said Maggie Hunt, chair of Teton County Dems. “It seems like people want local control and local rule until it doesn’t suit them,” she told WyoFile.

Others interpreted the Management Council’s actions as part of a campaign against Teton County and Jackson development regulations.

“There was some frustration that this particular process has been focused on Teton County,” Jerimiah Rieman, executive director of the Wyoming County Commissioners Association, told WyoFile.

Development regulations in Teton County and Jackson make an easy target for laissez-faire capitalists. The rules can require developers to offset free-market project impacts by constructing affordable and workforce housing or paying fees.

As a result of those rules, the community has built more than 1,550 homes since 1995 for local workers and their families, the Jackson/Teton County Affordable Housing Department told the committee. Development regulations helped create another 257 dorm beds, a department representative told lawmakers.

Nevertheless, home ownership in Teton County remains unattainable for many workers who rely on local wages and are unconnected to outside sources of income or wealth, according to ongoing analyses by Jackson Town Council member Jonathan Schechter, an economic consultant. Rents, too, are escalating, with two-bedroom apartments in major complexes going for between $3,000 and $3,500 a month, according to a January report by the community’s Affordable Housing Department.

At those rates, a family would need an annual income near $128,000 to meet the accepted standard that housing not cost more than a third of one’s income. That requires a household wage of about $61 an hour based on a 40-hour week.

The task force in November voted 8-4 to refer the ARU bill to a legislative committee. Three of the five legislators on the housing task force who were present voted against the measure, which was carried by the votes of unelected task-force appointees. Which committee the bill will land in front of is still to be determined.

“I think the state has to be careful here of giving the impression or taking the steps to say ‘We don’t find you capable of solving the issues in your community,’” Rieman, head of the commissioners’ association, said.

This article was originally published by WyoFile and is republished here with permission. WyoFile is an independent nonprofit news organization focused on Wyoming people, places and policy.