ADU rules in Billings

Billings rewrote its ADU rules in its Montana Land Use Planning Act conformance ordinance (Ord. No. 26-5930, second reading May 26, 2026; the amended zoning code states an effective date of July 1, 2026). Amended Sec. 27-1008.G makes an ADU, including a separate detached structure, a permitted accessory use on any parcel where a single dwelling unit is permitted or currently exists, and the accessory use table lists ADUs as permitted in the residential districts, ending the old N3 special-review gate. One ADU is allowed per residential lot, and a lot holding both a primary dwelling and an ADU must be at least 3,000 square feet. Detached ADUs follow the underlying district's dimensional standards; under MCA 76-2-345(2)(g) those cannot be stricter for the ADU than for the single-family dwelling. Wheeled or transportable structures (mobile homes, RVs, travel trailers) cannot serve as ADUs, and a new street address is required.

Attached and internal ADUs are equally permitted: units may be incorporated within or added onto the principal dwelling, a garage, or another accessory structure, or converted from existing space (including nonconforming accessory structures, provided the conversion does not increase the nonconformity). An attached or internal ADU may not exceed the gross floor area of the primary dwelling, must have its own separate entrance with a labeled street address, and a house with an incorporated ADU may not add another entrance facing the same street. The city code definition recognizes internal, attached, and detached configurations.

Ord. No. 26-5930 (effective July 1, 2026) raised the cap: the maximum gross floor area of an ADU is now 80 percent of the principal dwelling's gross floor area or 1,000 square feet, whichever is less; the prior code capped detached ADUs at 750 square feet. Attached or internal ADUs also may not exceed the primary dwelling's gross floor area. The state floor in MCA 76-2-345(1)(c) guarantees attached or detached ADUs up to 75 percent of the dwelling's gross floor area or 1,000 square feet, whichever is less, so the local 80 percent rule is the more permissive one that governs. Minimum lot size for a lot with both units is 3,000 square feet; height and other dimensional standards follow the underlying district and cannot be stricter for the ADU than for the primary dwelling.

No owner occupancy is required. The pre-2026 code required the owner to live in the primary or accessory unit at least six months a year and to record an owner-occupancy deed restriction, but MCA 76-2-345(2)(c) (SB 528, in force January 1, 2024) bars owner-occupancy requirements and subsection (5) voids non-compliant local rules; the city's official code interpretation of March 11, 2025 confirmed the owner-tenancy and deed-restriction provisions were void and unenforced, and Ord. No. 26-5930 repealed them outright effective July 1, 2026. The only surviving ownership rule is that the ADU may not be sold separately or subdivided from the primary dwelling or lot. Note the Municode reader still prints the repealed owner-occupancy text until the ordinance is codified.

No off-street parking may be required for an ADU. Ord. No. 26-5930 deleted the old rule requiring one dedicated ADU space, and the amended off-street parking table lists accessory dwelling units with no required minimum. This matches MCA 76-2-345(2)(a), which since January 1, 2024 has barred municipalities from requiring ADU parking or fees in lieu; the city's March 11, 2025 code interpretation had already declared the one-space rule void and unenforced. The Municode reader still shows the repealed one-space requirement until Supplement 67 codifies the 2026 ordinance.

ADUs are a permitted (by-right) accessory use reviewed administratively: the use table lists them as permitted in the residential districts, including N3 where the old code demanded a discretionary special review, and approval runs through a building permit with staff zoning compliance review by the zoning coordinator (no public notice or hearing). The city's March 2025 interpretation states that all ADUs must be permanent structures and must receive a building permit before construction. MCA 76-2-345 requires at least one ADU by right on any lot with a single-family dwelling and defines by right to exclude hearings, variances, conditional or special permits, and any discretionary action beyond site-plan conformance. Using an ADU as a short-term rental takes a separate annual STR permit, which is also an administrative permit.

The old clause barring third-party rentals in the owner-occupied unit was repealed effective July 1, 2026, so an ADU may be rented long-term without restriction; it may not be sold separately from the primary dwelling. Short-term rental (under 30 days) of an ADU is lawful but requires an annual short-term rental permit from the zoning coordinator plus a city business license, and on a property containing both a principal dwelling and an ADU only one of the two units may hold an STR permit (Sec. 27-1005.O.3(b)(1)). Both owner-occupied guest homes (owner or long-term tenant present at least 180 days a year) and whole-unit tourist homes are permitted STR types in the N districts, with a two-guest-per-bedroom cap; a permanently deed-restricted affordable unit cannot get an STR permit. The STR permit fee is 300 dollars per year on the current City Planning Fee Schedule. Montana has no statewide STR preemption; MCA 76-2-345(3) expressly preserves local STR regulation.