Sioux Falls offers density bonuses and reduced parking for workforce housing projects under Ch. 158, encouraging affordable units near transit corridors and downtown employment centers including hospitals and banking offices.
Under Shape Sioux Falls 2040 and Ch. 158 zoning, qualifying multifamily projects can earn up to 25 percent additional units when at least 20 percent of units are reserved for households earning 80 percent or below area median income. Projects near Sioux Area Metro routes receive parking-ratio reductions. The Affordable Housing Solutions Fund supplements the bonus with gap financing. Eligible projects must record an affordability covenant for at least 20 years. Banking-sector employers including Wells Fargo and Citi participate in workforce-housing partnerships near downtown employment hubs.
Failure to maintain affordability triggers covenant enforcement, recapture of permit fees, and potential rezoning challenges; no criminal penalties apply.
See how Sioux Falls's density bonus law rules stack up against other locations.
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