May 26 Housing Workshop
Moscow City Council Workshop, May 26, 2026. City Hall, Moscow, Idaho.
The Supply Problem
Moscow's housing shortage is a supply problem. The city permits 30 to 40 new homes a year for a population of 26,700. Vacancy has stayed below 2% for as long as anyone can measure it. Home prices doubled in a decade: a three-bedroom house that sold for $230,000 in 2016 now carries a median sale price of $456,000. Not enough houses, too many buyers, prices rise.
The council spent two hours discussing whether to create a housing authority, a new government body with the power to issue bonds, acquire property, and run housing projects. It would require staff, a board, legal counsel, and operating funds. Moscow currently has eight unfilled positions it cannot afford to fill, including three police officers. The city lost nearly $2 million from general fund operations in 2023 and just absorbed a 28% health insurance increase. City Administrator Bill Bellknap told the council that before spending time on a housing authority, he would "like to understand where this priority ranks with all of our other needs." Council President Drew Davis said the same thing more directly: the county started this conversation, then punted it to the city, and a city-only scope leaves out Palouse, Troy, and rural Latah County, where housing is also scarce.
The city's own track record shows what actually moves the needle. Over the past decade, Moscow reduced lot sizes, cut setbacks, allowed twin homes and townhouses, permitted accessory dwelling units, and opened commercial zones to residential use. The 2026 legislature pushed further: smaller manufactured homes (HB 800), expanded ADU rights (SB 1354), and a new starter-home subdivision category with lots as small as 1,500 square feet (SB 1352). Every one of those changes cost the city nothing and removed a barrier between a builder and a buyer. A housing authority does the opposite. It inserts a new layer of government between supply and demand. Moscow does not need another board. It needs fewer rules and faster permits.
Meeting Overview
Council President Drew Davis opened the second Council Workshop of 2026, dedicated to the topic of housing. City Administrator Bill Bellknap delivered a 48-minute presentation covering Moscow's housing market, affordable housing programs, the city's regulatory history, housing authority powers under Idaho law, and recent 2026 legislative changes. Council members then discussed priorities, tools, and next steps.
Attendees identified from audio: Council President Drew Davis, Mayor Hailey Lewis, Council Members Bryce, Sage, Scott, and Evan. Staff: Bill Bellknap, Matt (referenced but not presenting).
Housing Market Snapshot
Housing Mix
| Type | Units | Share |
|---|---|---|
| Multifamily | ~5,300 | 48% |
| Single-Family | ~5,000 | 45% |
| Mobile/Manufactured | ~560 | 5% |
Key Market Dynamics
- Population growth steady at ~1% per year for 50-60 years
- Housing historically tight: valuable surrounding farmland, limited market absorption (30-40 homes/year), university competition
- Home price index outpacing median household income since ~2022
- Interest rate lock-in: homeowners unwilling to trade 3% mortgages for 6.5-7%
- Median sales price relatively flat 2022-2026, bouncing between $400K-$500K
- Latah County housing costs 5.7x median household income (national avg: 3.6x)
Housing Starts & Production
Moscow's single-family housing starts show two distinct eras: steady growth from 1972-2006, then a sharp drop during the Great Recession (from 79 units in 2006 to 20 in 2009). Recovery has been slow, only recently reaching the historical average of ~50 homes/year.
| Period | Trend | Notable |
|---|---|---|
| 1977 (peak) | 83 SF + 277 MF = 360 total | Baby boomer buying wave; pop. ~16,000 |
| 2000-2010 | MF surge, then crash | Off-campus student housing boom (West A) |
| 2009 (trough) | 20 SF units permitted | Great Recession impact |
| 2019-2022 | Low production | Both SF and MF depressed |
| 2022-2025 | Climbing upward | Returning to ~50 SF/year historical average |
Affordable Housing Programs
Affordability Defined
Housing costs + utilities not exceeding 30% of household gross income. Rental assistance generally targets households under 80% of Area Median Income (AMI). Homeownership programs typically target 80-120% AMI.
Low-Income Housing Tax Credit (LIHTC)
Created by the 1986 Tax Reform Act. Provides tax credits subsidizing ~70% of new construction costs. Projects carry a 30-year affordability period, reassessed at 15 years. Moscow has ~255 LIHTC units: Creekside, Creekside Senior, Independence Hill, Eatmore Apartments, and Hawthorn Village.
Section 8 / Housing Choice Vouchers
Participants pay up to 30% of adjusted monthly income; Idaho Public Housing Authority pays the remainder via HUD funding. High demand with waitlists. A 2024 Idaho law prohibits cities from requiring landlord participation.
Program Mix (Region 2)
| Program | Share of Affordable Units |
|---|---|
| LIHTC | 56% |
| HUD Subsidized / Section 8 | 42% |
| HOME Program | 2% |
Proposed HUD FY27 Budget Cuts
- ~13% total reduction (~$10.7B vs FY26)
- $285M reduction in rental assistance and public housing (~0.4%)
- New work requirements and 5-year benefit limits for rental assistance
- Prohibition on new voucher issuance by public housing agencies
- $922M reduction in homeless assistance programs
- Proposed elimination of Community Development Block Grant (CDBG) and HOME programs entirely
Moscow, as a non-entitlement community (under 50,000 pop.), must compete for block grant funds through the Dept. of Commerce rather than receiving direct HUD allocations.
Local Providers & Organizations
| Organization | Focus |
|---|---|
| Habitat for Humanity | Homeownership construction + ADA accessibility modifications |
| Hills & Rivers (fmr. Moscow Affordable Housing Trust) | Community Land Trust model; 2 rehab + 8 new builds; expanded to Whitman County |
| Sojourners Alliance | Transitional housing, homeless prevention, rapid rehousing |
| Family Promise of the Palouse | Homeless prevention, rotating emergency shelter |
| IHFA | Administers LIHTC program statewide |
Community Land Trust Model
The CLT model creates permanent affordability by separating land ownership from home ownership. The trust owns the land, the homeowner buys only the improvement (the house) and holds a long-term ground lease.
- Ground lease: ~$80/month for a 99-year term that renews with new owners
- Resale formula: Limits resale price to keep the home affordable for the next qualifying buyer
- Tax benefit: Owner doesn't pay property tax on the land value (held by trust)
- Funding sources: IHFA grants, bank/credit union sponsorships, ARPA funds (expired)
City Regulatory Actions Timeline
Added bonus densities for affordable housing. Council approved $40K for affordable housing in FY09 budget.
Moscow Affordable Housing Trust filed as 501(c)(3). $15K dedicated to land trust setup via Community Frameworks (Spokane).
Trust officially recognized. Code amended to allow twin homes and townhouses.
Modified building heights and reduced side setbacks for smaller lots.
Allowed residential uses in commercial zones (by right above/behind commercial; CUP for ground-floor).
Allowed accessory dwelling units (ADUs).
Removed minimum lot size for ADUs; removed covered parking requirement in R1/R2.
Established affordable ownership grant program ($10K-$20K/unit with ARPA funds). 6 grants issued.
Latah County proposed housing authority; council expressed support (May 20). Grant program unfunded.
Focus shifted from county to city for housing authority. Fair Housing Commission urged council to act.
Housing Authority: What Is It?
Under Idaho law, a housing authority is an independent public body that operates as a municipal corporation. Board members are appointed by the mayor and confirmed by council to 5-year terms. Analogous to Moscow's Urban Renewal Agency (URA).
Powers
- Sue and be sued as a legal entity
- Execute contracts; make bylaws and regulations
- Construct, reconstruct, improve, lease, and operate housing projects
- Acquire, purchase, lease, sell, or exchange real property
- Exercise eminent domain
- Issue bonds; incur debt; invest reserve funds
- Investigate housing conditions; hold hearings
- Make or acquire loans to low-income persons
Creation Requirements
Governing body must adopt a resolution finding that unsanitary/unsafe dwelling conditions exist or that there is a shortage of safe, affordable housing. Can be terminated at any time the council declares no further need.
Obligations
Open meetings, public records, annual budgets, financial audits, annual reports to the authorizing body. Becomes a component unit of the city.
2026 Legislative Session Bills
Passed
Eliminates the requirement that manufactured homes be multi-sectional in residential zones. Reduces minimum size from 1,000 SF to 400 SF (single-section) or 800 SF (multi-section). Retains requirements for permanent foundation, minimum roof pitch, and consistent materials.
Requires all jurisdictions to treat short-term rentals the same as single-family dwellings. Prohibits cities from requiring: owner occupancy, professional property management, additional insurance, additional parking, inspections, signage, rental day limits, or increased utility fees.
Note: This was a more restrictive version than the Airbnb-backed draft. The Idaho Realtors Association and Airbnb supported it.
Prohibits cities from banning ADUs in any residential zone. Key provisions Moscow must comply with:
- Must allow one internal or one detached ADU per lot
- Cannot require additional off-street parking (with limited exceptions)
- Cannot impose impact/connection fees exceeding those for single-family homes
- Cannot limit ADU size below 1,000 SF or 75% of primary dwelling (Moscow currently: 600 SF / 60%)
- Cannot require owner occupancy (Moscow currently requires it)
- Cannot impose height limits less than the existing primary dwelling
Deadline: February 1, 2027. Each city must amend codes to allow starter home subdivisions in residential zones. Defined as: 4+ acre subdivisions with single-family detached homes on lots no larger than 1,500 SF, compact sizes, efficient site design.
- Cannot require lots larger than 1,500 SF (unless infrastructure limitations)
- Front/rear setbacks max 15 feet; side setbacks max 5 feet
- Lot width max 30 feet; lot depth max 70 feet
- Cannot impose permit/impact fees exceeding standard single-family rates
- Exceptions allowed for genuine infrastructure limitations (sewer/water capacity)
Moscow has done similar projects through PUD process (Tempo Commons, Greenside Hills).
Did Not Pass
Would have required allowance of twin homes and duplexes in all residential zones. Moscow's concern: included a limit of one parking space per unit, problematic for a college town with 6-8 bedroom duplexes. Expected to return next session.
Moscow already allows this (2014 code change) except primary ground-floor frontage (requires CUP). Same parking limitation concern.
Would have required cities to allow multifamily/mixed-use on religious lands with relaxed building height (40 ft / 3 stories), parking, and setback standards.
Council Discussion
- Housing is consistently a top-three issue raised by the public
- Drew attention to the distinction between "affordable" and "attainable" housing (different terms used in legislation)
- Noted the tension: homeowners want property values to rise, while non-owners need prices to fall
- Recalled that former Council President Parker had requested more detail on the housing authority proposal from advocates, and the response didn't meet expectations for specificity on staffing and funding
- Pointed out that three new council members have been elected since those earlier discussions
- Strongest advocate for housing authority as a tool, comparing it to how the URA operates
- Praised the CLT model: $80/month ground lease, 99-year term, perpetual affordability through tax and resale benefits
- Noted that IHFA, credit unions, and banks have funded CLT projects, not primarily city budget
- Recalled that in 2016, a family with one earner could buy an average Moscow home for ~$230K; that price has now doubled
- "A housing authority is one potential tool as a quasi-governmental entity... It's about having tools at our disposal"
- Clarified that the Fair Housing Commission in 2025 intentionally kept the housing authority recommendation broad
- Focused on practical barriers developers face: permitting timeline is the #1 complaint he hears
- Clay soils in Moscow/Latah County severely limit the construction window; missing it costs significant money
- Not calling for cutting the process, but asking: "Can we fine-tune or take out some steps?"
- Parking requirements are the second major cost/restriction driver
- Cautioned that reducing parking increases stormwater burden (clay soils = water doesn't drain)
- Recommended evaluating URA and land trust performance before creating new entities
- Suggested housing should be weighed against other priorities in the upcoming strategic plan update
- Emphasized protecting historic districts: solutions shouldn't create new issues in established neighborhoods
- Wants to "quiet the noise" around regulatory fees by showing with numbers what percentage of home cost is permits/fees vs. materials/labor/land
- Proposed a rental-first strategy: increase rental stock to drive down rents, enabling renters to save for down payments
- Mentioned Fort Collins, CO experiment ~20 years ago with minimal zoning (innovative, but the council that approved it was voted out)
- Has a list of 21-30 data deficits he wants answered before making decisions
- Directly asked council: "Do you want staff time to go towards determining the feasibility and costs of a housing authority?"
- "I don't feel good knowing that we've had two years of letters... asking us for action"
- Expressed concern about staff bandwidth: 8 unfilled positions (including 3 police), 28% health insurance increase, jail closure overtime costs
- "Before we spend time sketching it out, I would like to understand where this priority ranks with all of our other needs"
- Has spent much of his career on affordable housing development; notes it's very difficult in Idaho
- Encouraged by housing being discussed at the state legislative level
- Concerned about the county punting the housing authority to the city: "Solving housing in our county should be a county issue"
- Moscow is the most expensive place to live in Latah County; city-only scope leaves out Palouse, Troy, and rural areas
- Committed that this won't "go into a folder" but will require one-on-one conversations to advance
- Recommended the strategic plan update as the proper venue: "I'll be asking, what are your three top issues?"
- Referenced the 2008 precedent: when the city launched the housing trust, staff prepared a 3-year business plan
- Noted larger housing authorities employ 30+ staff
- Dept. of Commerce refused to let Moscow apply for an infrastructure block grant tied to a LIHTC project due to Build America Act requirements
- PNZ is already working on code updates for flexible development forms (cluster development, rear-loaded lots)
Agreed Direction
- Read the studies: All council members to review the 2019 Partnership Housing Study and 2022 CEDA Housing Assessment
- Submit written thoughts: Council members to send organized priorities/ideas to Drew and Mayor Lewis within approximately one week
- Strategic plan integration: Housing to be evaluated in the strategic plan update beginning in ~60 days, ranked against police staffing, EMS, infrastructure, and jail closure impacts
- Code compliance: Staff (PNZ) must begin code amendments for SB 1354 (ADUs), SB 1352 (starter home subdivisions, deadline Feb 1, 2027), and HB 583 (short-term rentals)
Open Questions
- Should the city or the county (or both jointly) pursue a housing authority?
- What is the actual staff time/cost to explore a housing authority feasibility study?
- Are existing entities (URA, Hills & Rivers, FAHC) performing well enough, or is a new entity needed?
- What specific projects would a housing authority undertake? (needed to estimate staffing)
- Should the city prioritize increasing rental stock or homeownership tools?
- What are the actual regulatory costs as a percentage of total home construction cost?
Transcribed from audio recording using faster-whisper large-v3. Speaker attribution inferred from conversational context (automated diarization did not separate speakers). All statistics from the city staff presentation. Some passages may contain transcription errors.