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City has four times fewer home starts than rest of L & C County

Developers say more should be done to encourage development within city limits

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Mountain View Meadows

Eliza Wiley/Independent Record

A beautifully manacured street with the South Hills of Helena as their backdrop is a good example of new growth in Lewis and Clark County and the City of Helena.

Ron Bartsch, owner of Sussex Construction, was planning to develop a two-lot infill in the 200 block of Hayes Avenue, an area within Helena’s city limits.

When Bartsch attended a meeting this spring to discuss his proposal with several of the city’s planning departments, however, he was met with requirements that made him reconsider.

Bartsch said he was told he would have to pave the road up to the two-lot development, a distance of three city blocks, as well as build sidewalks the whole way, incorporate stormwater drainage and provide fire turnaround access.

In all, Bartsch estimated the costs would ring up about a $1 million bill.

“Because they are so firm on, you know, ‘These are the current regulations. Here’s how you have to do it,’ it makes the city of Helena undevelopable,” Bartsch said.

“I think that the city has to understand that these exceptions exist,” he added later.

Regulations such as the ones Bartsch faces are among a slew of reasons why some developers are saying Helena isn’t doing enough to promote development in city limits, which may help explain why the number of home starts in Lewis and Clark County is about four times greater outside the city than inside.

Figures from the Montana Building Industry Association show that during the first half of 2014, 102 single-family houses were started in Lewis and Clark County outside Helena, compared to 24 in the city.

George Thebarge, director of community development and planning with Lewis and Clark County, pointed out that those figures are hard to pin down because the county does not issue building permits.

The MBIA said it received its numbers from electrical permits issued for single-family housing units.

Figures for the city are easy to pin down because of building permits the city issues. Building permits, which may run several thousand dollars, pale in comparison to costs from other regulations, some of which come from the top down.

Bill Pierce, owner of the building company Pierce and Associates, said that in his 40 years in the business, he’s seen increased regulations at the national or state level be forced down on cities.

“A lot has been at the federal level, but then again I think a community can be real pro-development, or not,” Pierce said.

Mike Hughes, of Mike Hughes Builder, said he’s seen the same increase in regulation, but he doesn’t think that’s the driving factor.

“I think people are interested in space,” Hughes said.

New homes outside the city, he added, may be on lots 25 percent larger than those in the city. Not to mention lots outside the city come at a better price.

In the city, homeowners must pay for water and sewage. The tradeoff for homeowners outside the city is the initial investment in a well and septic.

Loans also come at better rates for development outside the city. City residents don’t qualify for federal rural home loan programs.

All of these factors may influence where a homeowner wants to live, but Hughes said that none of it matters as much as price. The situation in Helena validates the old adage among builders, Hughes said, that people will drive as far as they need to drive to purchase and own a home.

“I think at the end of the day everything comes down to price. I know that my customers would very much like me to produce a home at the cost we do in the county, in the city, but we’re not able to do that,” Hughes said.

The chase to find cheap housing then leads to urban sprawl, a problem that Helena struggles with more than other major Montana cities.

MBIA numbers state that for every home built in Bozeman, 1.25 are built outside the city in Gallatin County; for every home built in Missoula, 1.12 are built outside the city in Missoula County; and for every home built in Billings, 0.55 are built outside the city in Yellowstone County.

“In my opinion Helena is not just the capital of Montana, it is the sprawl capital of Montana,” Mark Runkle, the developer of Mountain View Meadows, said.

Runkle’s development has the largest home growth in the city right now, with an estimated 800-1,000 homes in the

neighborhood upon completion. For Runkle, it was important to make sure he developed land that was within a city.

“It’s just known worldwide, conceptually, that tighter growth is better growth,” he said.

Runkle said that sprawl leads to problems of increased pollution from travel and infrastructure degradation because those living outside the city aren’t paying taxes for the resources they use in the city.

So he was determined to build in the city, and he said the city was cooperative during his planning process. He agreed that the requirements were higher in the city than outside it, but to Runkle that ensures a better standard of living. He added that he acknowledges many of those regulations came from the federal or state government and he just tries to put himself in the place of city officials enforcing them so he can understand their reasoning.

Still, the city can and should do more, Runkle said.

“The city has not proactively annexed and tried to expand, it has just waited and seen if people want to come in and follow the guidelines,” Runkle said.

Ron Alles, Helena’s city manager, said that’s going to change.

Alles said the city is looking to create infill on the west side by fronting the cost to install city water and sewer, then charging homeowners as they connect to the services.

“Within the next couple months … we have some opportunities and we’re going to try a new approach to build the infrastructure first, and then as people hook in they pay us for that,” he said.

That method will be more cost effective because it will split the price between a larger number of individuals, rather than placing it all on one developer or homeowner.

He disagreed that the city hasn’t done enough for developers in the past.

“I consider the city very pro-development,” he said.

Alles defended the regulations the city places on builders, stating that there is an expectation from city residents that they will provide for pedestrian traffic, not just vehicles, hence the sidewalk requirement. And air quality needs to remain high in populated areas, so paved roads are required in an effort to stop cars from stirring up dust.

Though Alles knows it’s cheaper to get a home loan outside the city, he added that people don’t consider the long-term costs when they build farther from town. The cost of transportation to and from work adds up.

Furthermore, people build away from amenities, then expect the city to come in later and pave a road or add drains for stormwater, he said.

He said that in addition to less tax revenue to maintain infrastructure, urban sprawl provides transportation issues and problems with schools.

That’s why he said the city has a growth policy and is taking a stance of building from the inside out.

“Part of my job is to encourage in whatever way I can — with a responsible manner — development within the city growth policy,” Alles said.

He also said the city grants exceptions to regulations when it makes sense.

“I think the city is flexible. I know the committee has granted variances in different situations,” he said.

They didn’t see Ron Bartsch’s development on Hayes Avenue as one of those exceptions.

Bartsch said he’s looking for solutions to the issues facing developers, and he thinks it would be a good idea for the city, the planners and developers to come together and determine how to encourage people to build and live within the city.

“If the city starts taking an active stance in the city of Helena, expanding our boundaries so the city can actually grow, and partnering with development so they can provide infrastructure, the city will actually grow,” he said.

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