a non-profit feels the squeeze

Missoula Habitat for Humanity Copes with Rising Costs, Fewer Donations

By Kaylee Porter, 8-05-08

	Habitat for Humanity volunteer Ashley Jackson prepares to apply a stain to the front porch of the Alvarado home being constructed in Windsor park. Photos by Alexia Beckerling

For years, finding affordable housing in Missoula has been a difficult task. Soon, due to rising land and building costs, providing it may be just as hard for Habitat for Humanity of Missoula.

“Over the past 20 years it’s phenomenal how much [building] costs have gone up,” Missoula Habitat for Humanity executive director Dave Chrismon says. “Since Habitat here in Missoula began back in 1991 we’ve seen lot sizes go down and down and lot prices go up and up.”

Though land is the biggest cost in building a house, Habitat feels pressure from the gradual increase of other expenses associated with building.

Professional services like plumbing, roofing and installing electrical and heating systems are more expensive than they used to be and Habitat has received less building material donations this year than in years past.

“Developers and builders have always been generous with us, but we just aren’t getting as many donations as we used to. That effort isn’t there like it was last year or the year before,” says Missoula Habitat for Humanity board president Jeff Roth.

Brian Magee, executive director of the Montana Nonprofit Association in Helena, says nonprofits are hit particularly hard by economic downturns because people have less disposable income to donate. At the same time, problems with the economy create a greater need for non-profit services, creating what Magee refers to as "a perfect storm" for nonprofits.

Because Habitat for Humanity of Missoula does not receive funding from Habitat International, they rely on donations for the majority of their funding.

	Kristy Frye and Habitat for Humanity site supervisor Mike Sehorn discuss the location of electrical outlets in the Frye family home in Windsor Park. Frye hopes that their home will be ready in October.

“With the exception of grants we may receive, all of our income comes from Missoula. It’s Missoulians giving us money and helping us build houses for other member of the community,” Roth says.

Last fiscal year Habitat was able to budget $40,000 for construction materials and tools. Based on this year’s donations, however, they had to cut it back to $30,000. There were similar reductions in the professional services budget, which was cut from $55,000 to $30,000.

“Both of these figures were clearly impacted by the slowdown in the building industry,” Roth says.

The situation becomes even more precarious when you consider lot prices and availability. In the early '90s, Habitat paid about $8,000 for quarter-acre lots. Now they are now paying $39,000 for lots less than half that size, Chrismon says.

But even $39,000 is a good deal. Habitat receives lots in the Windsor Park development just west of Missoula on Expressway at cost, which saves them about $26,000. The problem, Chrismon says, will be when these affordable lots run out.

“When they sell everything out there won’t be any more lots available, so we are concerned about a couple years out when we don’t have a partnership like this,” Chrismon says.

Of the 33 homes built by Habitat since they began in 1991, eight have been in Windsor Park. Three more are currently under construction.

Another aspect of the economic slump that could be affecting Habitat’s ability to fundraise and provide affordable housing is gas prices.

	A central wooden pillar in the Frye family site is decorated with blessings and messages of hope for their new home.

“I have heard from some of our volunteers, a woman from Alberton for example, ‘I can’t donate money to you because I have to give all that to the gas station so I can come down and help build the house,’” Chrismon says.

He added that the cost of hauling supplies to building sites is also a concern.

Roth points out that in order for the homes to be affordable for people, the commute to school or work must be affordable as well. This means Habitat cannot build too far out of town—a growing challenge as available land becomes more and more scarce.

Ultimately it is those in need who suffer first from the rising cost of land, building services and gas prices. The partner families receiving homes from Habitat pay for their houses at cost so these increases are passed on to them.

Because the partner family’s cost is rising, Habitat cannot afford to provide housing to Missoula’s neediest demographic.

“Instead of providing homes for the needier we have to go up the income bracket in Missoula to find someone who can afford the cost of the home,” Roth says. “We don’t want to set someone up to fail. We don’t want to put someone in a position where they can’t pay their mortgage, so we have to go up that income bracket to make it work.”

But Habitat for Humanity is just one part of the answer to Missoula’s affordable housing problem, Roth says. Programs like Section 8 and HomeWORD help by providing a safety net for those who are not eligible for Habitat homes.

Despite the hardship Habitat continues to push forward. Last year, the board decided to increase the number of houses built per year from two to three and they continue to urge people to donate their time, money or expertise.

“We have pushed hard to build more houses even though the price of lots in the community and other building cost have been going up. If prices were lower and we could build four houses for the cost of three we would love that, so we are being held back by all this,” Chrismon says. “People can help us get there and everybody has something different they can offer. It’s not all about cash donations. If you want to help, just call us up and we’ll figure out a way for you to do that.”

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