Frequently Asked Questions
Can we get more water?
Typically, when a community’s water usage increases, water rights can be purchased from nearby water sources to allow us to utilize more water from that water source. However, Bozeman is in a closed basin. This means that all water rights around us have been allocated so we cannot acquire more water rights to increase the reliable water supply for Bozeman. With the water rights that the City of Bozeman currently has, we have around 10,500 AF of reliable water supply.
2. What about groundwater?
Our current water rights are in regards to surface water. Using groundwater has not been shown to be a reliable water supply. More research needs to be done to determine reabsorption rates.
Groundwater is connected to surface water, so groundwater is essentially also closed due to surface water already being appropriated. The City would have to demonstrate sufficiently low impact or adverse effects of any groundwater wells on anyone’s surface water supply if they wish to use groundwater wells as a water source.
The City has done some exploratory wells to determine if some groundwater can be used to supplement our water supply.
3. How is water related to affordable housing?
Given that we are in a closed basin, our finite water supply must be considered in how we grow and develop. We have seen rapid growth in Bozeman, and the demand for water will soon exceed our reliable water supply. Additionally, as more and more people struggle to afford living in Bozeman, it is clear we need more affordable housing. By only allowing the cash-in-lieu of water rights (CILWR) option for developments that have at least 33% affordable units, we can ensure that new developments are helping chip away at our housing crisis.
Non-affordable developments can be built if the developers can bring new water rights to the table.
City of Bozeman code Sec. 38.410.130 addresses water adequacy for development and currently offers the cash in lieu of water rights option for new development.
4. Will this ballot initiative stop development?
Passing this initiative will encourage developers to include affordable units in their projects in order to utilize city resources, namely water. Any residential development that is helping meet the housing needs of our community by including at least a third of the units affordable at this much-needed level would still be allowed to proceed in Bozeman.
Passing this ballot initiative could halt new residential developments of 3 or more units that are providing no of affordability. Home remodels, backyard cottages, granny flats, and duplexes or single homes that are not part of a larger development, will not need to comply with the affordability requirements.
This ballot initiative is not focused on commercial development.
Any development that is able to provide its own water rights (ie. not dependent on the City’s finite reliable water supply) will also be able to build.
5. What is the City of Bozeman doing now for affordable housing?
The City of Bozeman is trying a variety of strategies to try to incentivize more affordable housing and allocates some money from the general fund to support some affordable housing projects. However, currently, most developments are approved and allowed to pay CILWR, regardless of how expensive the rentals or homes will be.
The City on February 11, 2025 adopted a new Affordable Housing Ordinance (AHO) that includes incentives such as reductions in parking requirements or increased height allowance for developers to build affordable units. These incentives can be granted for developments committing to build some units affordable at 60% AMI for rentals or 120% AMI for home ownership. The new AHO will go into effect by March 12, 2025.
The City has some limitations on what they can mandate for developers. For example, the City used to use “inclusionary zoning,” where a percentage of new homes were required to be affordable, or developers could pay cash-in-lieu of affordable homes. However, in 2021, the State Legislature banned cities from implementing inclusionary zoning.
6. Is this ballot initiative legal?
Yes! Even though the State Legislature has limited local government’s ability to implement some approaches to affordable housing such as required inclusionary zoning or rent control, local governments are allowed to use incentives to encourage the housing and development we want to see in our community. The use of cash-in-lieu of water rights can be conceptualized as an incentive to streamline new development that otherwise would be hard to achieve without the availability of new water rights. In exchange for this incentive, affordable housing will be included in the new residential development.
Along with acting inline with the State Legislature, we are also acting in accordance with the MT Constitution.
"ARTICLE II DECLARATION OF RIGHTS, Section 1. POPULAR SOVEREIGNTY. All political power is vested in and derived from the people. All government of right originates with the people, is founded upon their will only, and is instituted solely for the good of the whole."
"ARTICLE V THE LEGISLATURE, Section 1 . POWER AND STRUCTURE. ...The people reserve to themselves the powers of initiative and referendum."
7. Why is the requirement set at 33% affordable housing?
According to the City of Bozeman’s AHO Open House Presentation, there are 16,600 total renter households in Bozeman and Belgrade. 7,400 renter households earn at or below 60% AMI. There are 1,517 units of income-restricted housing being developed or are developed. This means that there are 5,883 renter households that do not have access to affordable units. The total estimated housing unit demand is nearly 900/year over 10 years for 2023 - 2033 (Table 19, Bozeman 2023 Economic and Market Update which is the latest data available). Therefore, the number of affordable units needed per year over ten years is 588.3 (affordable at or below 60% AMI). 588.3 affordable units per year needed / 900 total units projected to be built equals 65% household demand for affordable housing which is well in excess of 33%.
Additionally, 74% of the jobs created from 2017 - 2022 had an average wage of $60,000 based on the Bozeman 2023 Economic and Market Update further supporting the need for a large percentage of new housing to be affordable.
33% affordable units will begin to chip away at this severe lack of affordable housing at a necessarily higher rate.