Under Bellevue's current code, a Main Street lot in the Business zone can be built to 40 feet. A draft rewrite now before the city would make the base limit 35 feet and two stories for most of downtown. A builder could go higher only by deed-restricting part of the building's housing for people who work locally. In other words, height downtown would be earned with housing. A mile or so away, a developer is asking the city to annex 191 acres south of town. Under county zoning that land supports about 38 homes. The plan presented to the city calls for 439.
These are two separate proposals, and both run into the same state rule. Idaho limits how fast a city's property-tax revenue can grow, and new construction and annexation are two of the ways a city's budget can grow faster than that limit. If you are comparing the South Valley with Hailey or the north valley, these rules shape what Bellevue is likely to add over the next several years.
The Tax Rule Behind the Downtown Draft
The Idaho State Tax Commission's 2026 budget training explains the formula. A taxing district starts from its highest property-tax budget of the prior three years and adds 3%. On top of that it can add increases for new construction and annexation, and those growth increases are capped at 8%.
Bellevue's Community Development Director, Brian Parker, spelled out what that means for the city in a September 28 memo to the City Council and the Planning and Zoning Commission. He wrote that the 3% cap "has the effect of divorcing the revenue generated by property tax value from the economic vitality of a city." According to the memo, new improvements are added to the tax roll at 90% of their assessed value. Parker's conclusion, reported by the Idaho Mountain Express:
"The pathway to increasing the property tax base is to increase new construction activity to take advantage of the extra five percent year over year."
The same memo lists "Increase Property Tax Revenue" as one of four goals for the zoning rewrite. The other three are walkability, business activity and housing. Parker also argued that low-density growth leaves a city with road and service extensions it has to maintain for decades. Concentrating growth where pipes and streets already exist is meant to avoid that cost. The downtown draft reflects that reasoning.
What the Draft Would Change on Main Street
The draft splits the current B Business zone, which runs the length of Main Street, into two zones. A Downtown zone would cover roughly a block on either side of Main from just north of Beech Street to Chestnut Street. A Highway Business zone would cover the northern stretch and the corridor along Forbis and Martin lanes. The Limited Business/Residential zone would get minor edits and a new name, Neighborhood Mixed-Use. The city posted an interactive map of the proposed boundaries.
Here is how the current code compares with the draft:
| Current B zone | Draft Downtown (DT) | Draft Highway Business (HB) | |
|---|---|---|---|
| Base height | 40 feet | 2 stories or 35 feet | 3 stories or 40 feet |
| Extra height | None | 45 ft/3 stories with 25% local housing; 60 ft/4 stories with 50% | None |
| Apartments | Conditional, through a mixed-use PUD | Permitted | Conditional |
| Single-family homes | Not a listed permitted use | Prohibited | Prohibited |
| Gas stations | Permitted | Prohibited | Conditional |
| Car washes | Permitted | Prohibited | Prohibited |
Coverage of the proposal described it as raising the height limit from 40 to 60 feet. The draft code is more specific. The 60-foot limit applies only to a building where at least half the residential square footage is deed-restricted local housing, and a third story facing the street must step back 10 feet from the façade below. A building with no restricted units would get a lower ceiling downtown than it has today.
The draft defines a "local housing dwelling" as a primary residence for someone working at least 30 hours a week for a Bellevue-licensed business, someone working 30 hours a week in Blaine County healthcare, emergency services or public safety, a person over 65, or a disabled person who worked full time in the county before their disability. It sets no income limits. The restricted units would have to be mixed in with market-rate units, not grouped separately. Each restricted unit would also reduce the required parking by one space. Separately, parking requirements for commercial uses downtown would drop by half.
For a buyer, that points to apartments over shops downtown, with part of each larger building tied to local employment, and a lower likelihood of drive-throughs and gas stations in the core. Mayor Christina Giordani told the Mountain Express she is aware residents have a "big fear" of gas stations and box stores. She sees the rewrite as a way to bring zoning in line with what the community wants. The draft would also send conditional use permits to the City Council for a final decision and make design review a noticed public hearing before the commission, so neighbors could comment on individual projects.
The draft is not settled. Councilwoman Tammy Davis told the paper that apartments in the business zone would suit her only as part of a mixed-use building with commercial space on the ground floor. Councilwoman Genoa Beiser said she needed "more time to chew over the parking and housing incentives." Parker plans focus groups with Business zone property owners before sending the draft to the Planning and Zoning Commission. The Council is aiming for final review in February 2027.
Gannett Ranch Would Add Through Annexation
Downtown, any added tax growth would come from new construction. Gannett Ranch would add land to the city through annexation, the other route the state formula counts. The property is 191 acres east of Gannett Road. The petitioner is Gannett Ranch Holdings, LLC, and the development is led by Lance Emery, executive vice president of development at Steadfast Companies. According to the Idaho Mountain Express, the proposal includes:
- Phase one: 65 single-family homes, 65 townhomes and 225 apartments
- Phase two: 84 homes
- Phase three: agricultural use
- Across the project: 10,000 square feet of commercial space and 100,000 square feet of flex industrial space
- On-site wastewater treatment instead of Bellevue's municipal plant
The land is currently zoned R-5 under Blaine County's Residential/Agricultural designation, which the Mountain Express reported would allow about 38 single-family homes. Annexation would open the way to more than eleven times that number. Emery told the paper that a main reason to develop inside the city is the "zoning and various zoning opportunities that are available within cities that are not necessarily available within the county." He also said the project's water use would be no more than 20% of the property's current agricultural irrigation, with excess water from its water rights used to recharge the aquifer.
The schedule has slipped. The Planning and Zoning hearing set for October 5 was postponed because of a defective online notice, and the city confirmed that the Council item planned for October 13 would not go forward. The 5b Gazette reported that the applicants then said they could not attend a rescheduled October 19 date and that November 9 was named as the next available meeting. The Gazette also reported a dispute over whether the ranch is contiguous with city limits. City staff concluded it is, because part of the land is already inside the city. During open comment on October 13, speakers opposed the annexation, citing density, water, traffic and housing costs.
Even if the project clears the eligibility step, it still faces a full application review, a commission hearing with a zoning recommendation, and a final Council hearing. The city's own memo says the Council "has broad latitude" to decide whether annexation is in Bellevue's interest. For a buyer, the 439 homes are a possible future supply, not one already scheduled.
The Meetings Where This Gets Decided
Starting in November, Bellevue moved Council meetings to the first and third Mondays of the month and Planning and Zoning meetings to the second and fourth Mondays. These are the next dates on the city calendar:
- Planning and Zoning Commission, Monday, November 23, 5:30 to 7:30 p.m.
- Bellevue Urban Renewal Agency, Tuesday, December 1
- City Council, which meets on the first and third Mondays at City Hall, 115 Pine Street
Agendas and packets are posted on the city's site before each meeting. The September 28 packet with the full draft code is available as a PDF.
Questions Buyers Ask
Would the downtown rules affect an existing house on a Business-zoned lot? The current B zone does not list single-family homes as a permitted use, and the draft would prohibit them in both new business zones. Parker's memo states the goal of avoiding "high numbers of nonconformities, which would discourage maintenance and improvements." If you are looking at a property along Main Street, check its zoning designation and its status under the code before you make an offer.
Is the 60-foot height limit already in effect? No. It is part of a draft still under review, and February 2027 is a target date for adoption, not a vote that has happened.
Would Gannett Ranch use Bellevue's sewer plant? The developer has proposed on-site wastewater treatment, citing capacity limits at the municipal plant.
This post is general information about proposed rules and state tax law, not legal, tax or financial advice. Please confirm how any of it applies to a specific property with an attorney, a tax professional or the City of Bellevue.
If you are weighing a South Valley purchase while these decisions are pending, Stevenson Real Estate Group can go through the draft zoning map and the hearing calendar with you, parcel by parcel. We follow Bellevue's meetings closely so you can make your decision with the current status of each proposal in hand.
