Updated Unified Development Code could Diversify Housing Options in Bozeman

After years of revision, the newest version of Bozeman’s Unified Development Code (UDC) went into effect on Feb. 1. The updated UDC aims to address housing affordability by allowing for a wider range of housing options in residential areas — including higher-density dwellings. 

The UDC is a legal document that regulates the types of development permitted in different areas through building standards and zoning districts, according to the City’s website. Bozeman Community Development Manager Chris Saunders said the UDC influences all new development in the community. 

“Every home, every new job, recreation activities, all that kind of stuff gets influenced by the [UDC],” he said. 

According to City Commissioner Emma Bode, the UDC also dictates what kinds of housing can be developed in the various zones across the city and regulates some visual aspects of Bozeman, like vegetation planting and home siding. 

“It very much impacts what it feels and looks like to live in Bozeman,” she said. 

Bode said that the new UDC is so different from the previous one that the city commission repealed the old document entirely. According to her, these large changes were in response to a 2023 revision of the Montana Code Annotated, called the Montana Land Use Planning Act (MLUPA). 

“[The] MLUPA required municipalities across the entire state to implement some specific development code updates — some specifications all aimed at making it easier to build,” Bode said. 

“I think opponents to MLUPA would say that it was slashing regulation, and proponents would say that they were trying to address the housing crisis by removing red tape and regulation that made it more expensive to build homes,” she said. 

According to Saunders, the state’s updated regulation on local development policy is a response to both national questions of housing affordability and a desire to update state regulations and laws. 

One such change is that local policy must now allow duplexes and manufactured homes to be built anywhere that single-family homes can be built, according to Bode. She said that this allows for more diverse housing options, which can increase affordability. 

“The updated [UDC] provides a lot more flexibility by the right for people to build the types of housing that are less expensive,” she said.  

The new UDC allows up to eight units per building in low-to-medium density mixed-use residential zones, while low-density residential zones are limited to two. 

Bode said that while drafting the new UDC, the city commission sought extensive community feedback. This included a survey on housing priorities in the Bozeman community conducted by the local nonprofit Forward Montana. 

“More 18 to 24-year-olds were ranking affordable housing as their top priority, whereas homeowners and older folks were ranking things like neighborhood and community character as their top priorities,” she said. “Certainly older folks and homeowners do still see affordability as a problem, but they weren’t ranking it as the most important thing.”

According to Bode, while the City cannot change construction and labor costs, which partly determine housing costs in an area, it can create policies regulating housing density.  

“Really, the only place that we have a strong impact on housing price points is in our policies, our laws around what's allowed to be built where,” she said. “While this is a small wedge of the housing cost equation, it's an important one.”

According to Saunders, the City is also working to incentivize affordable housing development by implementing clear regulations that won’t slow construction. 

“The City includes a series of incentives in the code that allow folks to hopefully be able to save some costs on their construction — those are typically income-limited,” he said. 

Bode said that the incentive-based program encourages affordable housing without requiring it. 

“We are not allowed to require affordability by any means,” she said. “Our state legislature prohibits us from doing things like inclusionary zoning.” 

Instead, she said the updated UDC benefits developers who build affordable housing. 

“Essentially, we have a streamlined track where developers can maybe get an extra story of height or have less parking required if they make a certain proportion of the units they build at an affordable rate,” she said. 

Benjamin Finegan, executive director for the Bozeman Tenants Union, said that the UDC can also impact renters.

“More diverse housing options and increased density are important parts of the solution towards safe, dignified housing for all,” he said. “More options and more density can only positively impact the cost of rent.” 

However, Finegan said that to truly lower rent costs, more action is necessary. 

“Ultimately, to really impact the rent, tenants need massive public investment in decommodified housing, increased tenant protections and unions with the leverage to negotiate rent directly with corporate landlords,” he said.