Montana’s Housing Miracle Strikes Twice

Something big is brewing in Big Sky Country: an ongoing bipartisan revolution in housing policy. 

In 2023 Montana passed an ambitious package of land use reforms, making it easier for the state to meet its growing demand for housing. This year the legislature’s cross-partisan pro-housing caucus kept its foot on the gas and passed an even more ambitious package of changes to the rules that have contributed to the state’s housing shortage. 

The most significant reforms won’t take effect until 2026, but other states would do well to study Montana’s strategy for success. 

An end to overbuilding parking lots 

House Bill 492, introduced by Rep. Katie Zolnikov (R-Billings), sets a high bar for other states pursuing parking reform. Beginning in October 2026, any home smaller than 1,200 square feet in Montana’s ten largest cities will be exempt from costly local parking mandates. Because more than 80 percent of apartments and condos in the United States are already smaller than 1,200 square feet, this effectively means that multifamily buildings in those cities will no longer be required to have any particular number of off-street parking spaces. HB 492 also exempts small detached homes, all deed-restricted affordable housing, assisted living homes, and daycares. And it strikes down excessive parking mandates in many smaller cities, giving property owners there almost as much flexibility over how many parking spaces they need. 

This is a major change for many of Montana’s fastest growing cities such as Bozeman, Missoula, and Whitefish—all of which currently require one to two parking spaces for every home. It’s hard to understate the potential impact of HB 492. A recent study found that eliminating parking minimums alone can boost new home construction by 40–70 percent. In the future, Montana may go further. HB 492 originally set limits on parking mandates for other commercial uses as well. While these were removed from the bill in committee, legislators indicated they’d like to reintroduce the idea in a future legislative session. 

Taller buildings, double-wides, condo lawsuits, single staircases, and more 

Where HB 492 concerns what builders can do on the ground, Senate Bill 243, introduced by Sen. Ellie Boldman (D-Missoula), looks upward. The bill overrides local height restrictions to allow buildings up to six stories in downtown, industrial, and “heavy commercial” zones. (“Heavy commercial” zones are not defined in the bill; however, the sponsor’s floor speeches indicate it’s where “commercial uses cluster” and not “standalone corner stores in the middle of a single-family neighborhood.”) 

Several narrower bills tackle other obstacles to housing construction. 

• SB 133, introduced by Senate Majority Leader Greg Hertz (R-Polson), limits the impact fees that cities charge developers, which increase the cost of construction. Specifically, it eliminates administrative fees, caps fees growth to inflation, and limits the imposition of fees to infrastructure projects that are directly linked to a proposed development.  
• Hertz also successfully ran bills to limit construction defect litigation (SB 143) and transfer decision-making on historical preservation permits from volunteer-run boards to professional city staff (SB 214).
• SB 252, introduced by Sen. Dave Fern (D-Whitefish), requires cities to treat manufactured homes on equal footing as stick-built construction.  
• SB 532, introduced by Sen. Forrest Mandeville (R-Columbus), allows one ADU by right on parcels outside cities. (Hertz’s SB 528 from the prior session legalized ADUs within cities.)  
• Finally, SB 213, introduced by Sen. Daniel Zolnikov (R-Billings), puts Montana among states such as Connecticut and Washington that are re-legalizing single-stair residential buildings. SB 213 orders new rules for the state building code to allow for the construction of single-stair buildings up to six stories when they meet fire safety standards. 

Compared to the “Montana Miracle” of 2023, which garnered national attention, this year’s pro-housing legislation advanced without much fanfare. Intraparty feuds and a large number of competing property tax reduction schemes took up attention in Helena. Yet with such a broad reform of municipal parking mandates, the impact of this year’s package could be significantly larger. 

How to grow miracles in your own state 

What can pro-housing lawmakers in other states learn from the Treasure State? 

First, form a broad coalition. During two legislative sessions now—note that the Montana legislature only meets every other year—a bipartisan group of Montana lawmakers shepherded an array of bills through the legislative process with support from a diverse pro-housing coalition that included environmental organizations, conservative think tanks, student organizations, and local chambers of commerce. 

Second, get an early start. As in 2023, nearly all the bills in this legislative session originated as recommendations from a housing task force set up by Republican Gov. Greg Gianforte, made before the session began. 

Finally, consider giving cities time to adjust to the still-novel concept of statewide zoning reforms. Montana’s most significant reforms were amended to go into effect after a year for cities to prepare. This concession was key to moving bills out of committees that are usually hesitant to infringe upon “local control.” 

What’s next for Montana?  

First, the governor still must sign the bills. Gianforte has consistently supported pro-housing reforms during his five years in office, and these reforms originated from his task force’s recommendations. Future legislatures may want to limit commercial parking mandates, establish permitting “shot clocks” that speed up project approvals, set stronger limits on local design codes, and begin collecting data on the speed and volume of local government permitting. 

No legal reform will instantly end a housing shortage that was decades in the making. Collecting evidence and seeing what works will be a task for policymakers in Montana and beyond.