Several tools to consider in the state's battle against the affordable housing crisis

Apr. 22—CHEYENNE — It was only the first official day of the interim session, and state lawmakers had a lot to digest from their Monday meeting in Lander on ways to tackle the issue of affordable housing.

The Wyoming Legislature's Joint Corporations, Elections and Political Subdivisions Committee heard testimony from real estate agents, renters and county officials on where Wyoming is headed with the affordable housing crisis, pitching ideas on how to address it.

Rep. Mike Yin, D-Jackson, reminded his fellow committee members that affordable housing is a key element in building up the Cowboy State's workforce.

"We're doing it to help Wyoming families ... live in a house in Wyoming and not go somewhere else, and then be part of our workforce," Yin said. "They can't do that if they can't live here."

Cheyenne Mayor Patrick Collins told lawmakers when he was elected three years ago, the Cheyenne Housing Authority had 1,000 families on its waiting list. That number is now up to 2,000 families waiting for housing.

Affordable housing units are currently built with funding from the 9% low-income housing tax credits, regulated by the Wyoming Community Development Authority (WCDA). The WCDA builds 120 to 150 affordable housing units each year.

This is not enough to keep up with the growing need for affordable housing, Collins said.

"We're getting further and further behind," he said. "If we're going to be successful, we have to find a different way to fund housing projects."

Stakeholders presented to lawmakers "tools" available to help the state expand its affordable housing supply, including living facilities for Wyoming's workforce. Tax Increment Financing district (TIFs), leasing state and federal lands, and tax incentives to refurbish abandoned buildings were just some of the tools brought to state policymakers' attention Monday morning.

Incentivizing developers

Public-private partnerships have already seen success in places like Teton County.

TIFs are one such relationship that could be used to incentivize more developers to build in the area.

In order to qualify as a TIF district, the local municipality must establish an Urban Renewal Authority (URA), requiring a study to find blight or areas filled with vacant lots, abandoned buildings and houses that are in very poor or dangerous conditions.

Property tax administrator Kenneth Guille with the state Department of Revenue said this tax structure hasn't been used much in the Equality State. It is mainly a tool for cities and counties to cure blighted areas, he said.

Cheyenne's use of the URA tax increment financing tool helped the city demolish asbestos-infected buildings on the capital city's west side. Now, in its place, is a clean site where the construction of a new hotel is underway.

TIF districts require a redistribution of taxes, Guille said, but they don't take away funding for entities such as schools and other city services that depend on property tax revenue. Basically, these entities receive the same amount of tax revenue as they did before the TIF was established.

TIF captures the increase in property taxes and redistributes those funds to subsidize development. This system works to incentivize developers, which Collins and other stakeholders said are few and hard to find in Wyoming.

As the appraised value of property increases from the new development, the new tax revenue is used to pay back the city's indebtedness. TIF districts are temporarily established, with varying timelines, depending on the district.

Collins told lawmakers TIFs are a great tool to fund infrastructure for affordable housing. Unfortunately, many of the surveyed areas for housing projects don't meet the blight requirement. He asked the committee to sponsor a bill that would provide some TIF financial support for infrastructure without the blight requirement.

The other main request is to provide guidance on the usage of TIF districts, mainly to the benefit of county assessors.

Old buildings need some love

Rep. Trey Sherwood, D-Laramie, asked the committee to draft a bill similar to House Bill 135, which failed to make it through the 2023 general session for lack of time. The concept of the bill was first developed by Sen. Dan Furphy, R-Laramie, in 2018.

The idea is to provide property owners with an incentive to develop old buildings by way of tax credits. The bill would allow local governments to identify up to a certain number of buildings deemed old or neglected.

A property owner could earn a 50% credit on their property taxes if they demolish or remove the building within two years, Sherwood said. They could earn 100% tax credit if they are able to bring the building up to code in two years, ready for a tenant to move in.

Sherwood added this bill would not allow city or local governments to enter into eminent domain.

Lease state, federal lands

Committee members also toyed with the idea of leasing state or federal lands to expand affordable housing development. Yin asked about possible conflicts of pursuing this path.

Jackson/Teton Housing Director April Norton said the Wyoming Condominium Act does not allow long-term ownership of a condo on leased land. Travis McNiven, who said he's familiar with federal policies, said the leasing of federal lands for affordable housing development is possible.

The federal Bureau of Land Management's disposal list has allowed the building of airports, fire departments and cemeteries on federally owned lands.

Laurie Urbigkit with Wyoming Realtors said Realtors "would love to see" more discussion on leasing state and BLM lands. Urbigkit said there needs to be more development on workforce housing so teachers, nurses and emergency responders aren't being driven out of the state.

Costs of land are expensive in Cody, she said, which has halted efforts to expand workforce housing. Sen. Eric Barlow, R-Gillette, said legislative leadership on the Management Council tasked the Management Audit Committee to put together a request for proposals.

Barlow chairs this committee and promised to include this topic in its discussions. The next Corporations Committee meeting will be Aug. 8 in Evanston.

Hannah Shields is the Wyoming Tribune Eagle's state government reporter. She can be reached at 307-633-3167 or hshields@wyomingnews.com. You can follow her on X @happyfeet004.