Across the nation, zoning incentives and community land trust models are being deployed to create stable, affordable housing for skilled workers many leaders hope to bring to their community.

As of 2023, more than 300 nonprofit or quasi-governmental agencies held over 40,000 housing units across the country, and land trust entities were found in almost every state, according to the Lincoln Institute of Land Policy. Experts estimated those organizations represented 43,931 residential units, as of year-end 2022.

In Jackson, April Norton, director of the Jackson/Teton County Affordable Housing Department, said her community employs a similar — but much bigger — program to Sheridan’s new Sheridan County Attainable Housing Council project.

“We have a similar program that is income and asset restricted,” Norton said. “We have three income ranges, 0-50% of median (income), 50-80% of median income and 80-120% of median income.”

The Jackson/Teton County Affordable Housing Department also offers a workforce housing program that targets people who earn more than 120% of the median income, but not enough to get into market-rate housing in Teton County.

“The institutions for which these people work are not able to pay salaries that would allow their employees to afford a $3 to $4 million home. That is where our program steps in,” Norton said. “We require those folks to work full-time locally, and earn 75% of their household income locally.” 

Norton said she had been in contact with local leaders about Sheridan County Attainable Housing Council work, and Christine Dieterich, executive director of Habitat for Humanity of the Eastern Bighorns, said she has learned from regional efforts like Jackson’s.

Every year, Jackson’s Affordable Housing Department produces a Housing Supply Plan that outlines community goals for the upcoming year. The latest plan, adopted March 3, states that “public-private partnerships and land development incentives continue to sustain our community by providing Affordable and Workforce homes for locals.”

In 2023, developers broke ground on two new affordable housing developments and completed two workforce housing developments, totaling 108 new homes for local workers and their families.

“We have 123 units under construction right now, and we are anticipating adding almost 200 units to the portfolio this year alone,” Norton said.

Just a decade ago, Norton said Jackson’s housing authority was focused on developing one project at a time. Now, they focus on partnering with private sector developers and nonprofits like Habitat for Humanity on large-scale developments.

To the north in Montana, David Fine, urban renewal program manager for the city of Bozeman, said that prior to 2001, the city had an inclusionary zoning program that required developers to build a certain number of affordable units in any given project. But about 20 years ago, the Montana Legislature made inclusionary zoning illegal.

“We had to start over,” Fine said.

Working with a regional consultant, the city came up with zoning incentives to create affordable housing based on an assumption that, with stable land costs, more units for sale or rent on land would equal a greater return per square foot for land costs. Under its voluntary program, Bozeman offers developers incentives.

Based on the number of units deemed “affordable” at a certain median income the project will provide, developers are allowed greater density in builds. That means that if 5% of the units in a proposed project are affordable to 80% of the median income, that developer will receive shallow incentives: things like an additional one to two floors allowed, a “modest” reduction in minimum parking spaces or smaller lots allowed for a townhome development.

The program is working, but there is a lag, Fine said.

“This is a bit of a lag here. It takes a while for people to start designing the projects,” he said. “We are just now seeing a lot of people taking advantage of it.”

The local government did adopt the zoning program as proposed at the time, Fine said, understanding that supply is an essential part of housing affordability. The reason to require long term affordability restrictions tied to income, Fine explained, is that, if demand continues to stay high and is addressed only by supply and demand economics, units will appreciate significantly, leading to higher rents or higher sales prices.

“Requiring caps on appreciation, or caps on rent for the long term, is part of how you ensure those units remain affordable regardless of what happens with demand,” Fine said.

Norton said she can’t speak for the rest of the state, but work in Teton County has been crucial to keeping skilled workers in the area.

“This is a vital component to our community’s sustainability. Period. The number of critical service providers, whether they’re first responders or teachers or plow drivers that live in our housing — those agencies are not going to pay enough money for somebody to be able to buy a market-rate home in Jackson,” Norton said.

Fine said many people in the Rocky Mountain West, including elected officials, are beginning to recognize housing is the No. 1 need when it comes to economic development. 

In his decade in Bozeman, Fine said he has seen numerous businesses — including tech startups that provide mid- to high-wage jobs and other businesses “we say we want in the Rocky Mountain West” — come to town.

“All of them have had very rosy expectations about how fast they would be able to grow their company in terms of headcount. Almost no one has been able to hit their headcount goals,” Fine said.

But imagine the economic impact those companies could have had, Fine said, if they were able to grow.

“We need to make sure that the companies that are here are able to find the talent they need to grow and thrive. Housing is an economic development issue. That is a big part of why we do housing,” Fine said.