Allow covenants that provide housing affordability
Summary
HB 422 would amend Montana’s covenant statute, section 70-17-203, MCA, to expressly allow certain real-property covenants that are designed to promote workforce housing affordability and attainability. The bill adds a new category of covenants that may run with the land: restrictions on the sale, lease, or an owner’s share of equity appreciation in residential property when those restrictions are tied to specific income levels or occupations. The stated purpose is to support long-term affordability for workforce housing.
In practical terms, the bill would permit deed restrictions or similar covenants that limit who may buy or lease a home, or how much equity appreciation an owner may retain, if the restrictions are structured to benefit people in designated income or job categories. It would not broadly rewrite all covenant law, but would carve out an explicit statutory authorization for this type of affordability-focused housing arrangement within Montana’s existing rules governing covenants that run with the land.
Impact
The bill would amend Montana property law by expanding the list of covenants recognized as running with the land under 70-17-203, MCA. This would give legal support to workforce-housing covenants in residential developments, making it easier for local governments, nonprofits, employers, or developers to create deed-restricted housing programs aimed at keeping homes affordable over time. The affected parties would include homeowners, buyers and renters in targeted income or occupation groups, developers, housing trusts, and land-use planners.
Sentiment
The available voting history suggests the bill had some support but also notable resistance. It passed a House Judiciary committee vote to table by a wide margin, 19-1, indicating that most members favored setting it aside rather than advancing it. The bill ultimately died in process, which suggests that while the concept of housing affordability had appeal, there was not enough momentum to move the measure forward.
Contention
The main point of contention is likely the policy choice to allow covenants that restrict sale and lease rights based on income or occupation and that can limit an owner’s share of equity appreciation. Supporters would view these tools as necessary to preserve long-term workforce housing affordability, while opponents may have concerns about market restrictions, property rights, fairness, and the precedent of tying housing access to specific jobs or income brackets. The committee’s decision to table the bill indicates that these concerns outweighed support for the proposal at that stage.