Missoula County's project page for the Lolo water system has one plain sentence that matters more to a Lolo purchase than the list price does. The water system "has reached full capacity, and no new connections are allowed." Lolo still has open land, buyers, and builders. What's in short supply is a hookup to the county's water.
That shortage puts a value on homes that are already connected, puts a cost on any parcel that isn't, and sends a bill toward the existing district whose size hasn't been published yet. If you're comparing Lolo with Florence, Frenchtown, or the edges of Missoula, what you're really comparing is which side of that line a property sits on.
The sewer side has room. The water side doesn't.
The county describes two systems in two different conditions. A study done before and during the Covid pandemic found the wastewater system at capacity. Newer data show it can still take up to 400 new connections, so the county is no longer planning to add sewer capacity right now. Water is the constraint that holds everything else in place.
The county is also open about how thin that water margin is. Its project page says that if well No. 3, the largest well, failed during peak demand, the system "would struggle to provide enough water for household use and fire suppression." The proposed fix is to upsize wells No. 1 and No. 2 and a key water main. On the wastewater side, the county would add a redundant bioreactor and secondary clarifier, because the treatment plant currently has no backup if either one fails.
So the water system is too small for new homes, and it's also running without much margin for the homes it already serves. Both problems are addressed by the same $11 million project, and that estimate is still subject to change.
What a new connection costs on paper
On January 8, 2026, the Missoula County commissioners voted 3–0 to adopt impact fees for the Lolo sewer and water system. The county's fee schedule applies them to new or updated sewer and water connections to the RSID 901 system. The project page describes them as one-time fees on new construction and says they are not a new tax or assessment on existing properties.
The county's current fee schedule sets the fee by service-line size:
| Service line | Sewer impact fee | Water impact fee | Combined |
|---|---|---|---|
| Single family, 3/4" or 1" | $7,888 | $9,629 | $17,517 |
| 1 1/4" | $14,185 | $17,316 | $31,501 |
| 1 1/2" | $22,913 | $27,970 | $50,883 |
| 2" | $48,829 | $59,605 | $108,434 |
The schedule also says the Lolo fees are subject to an annual increase starting July 1, 2027. The county's own examples show who lands in the bigger rows. A four-plex usually needs a 1 1/4-inch to 1 1/2-inch line. A car wash needs 1 1/2 to 2 inches, and a hotel needs 2 inches or more. Fire-suppression lines are 4 inches but don't count against system capacity. Under this schedule, adding units, or building anything commercial, costs more than one flat fee per lot.
A fee schedule doesn't create water, though. For a buyer weighing a lot inside the district, the $17,517 is the known part of the cost. The bigger question is when that payment buys a connection the system can actually serve. Under the county's latest posted language, the answer depends on the upgrade.
Belltower shows what the constraint looks like on a site plan
The best local example is the old Lolo School property at 11395 Hwy. 93 S. Developer MCG-Vines has an approved Belltower Planned Unit Development on the 33.75-acre site. It includes 56 single-family lots, one commercial lot, one large lot with no immediate development plans, and 16.71 acres of dedicated public parkland, far more than the 0.6 acres required.
The county's description of the project spells out the water problem directly:
"Due to current water and sewer limitations, only the 56 homes are planned for immediate construction... The commercial lot will be prepared for dry utilities (like internet and electricity) only until full water and sewer services are available in the future."
The 56 homes will be served by the Lolo RSID water and sewer systems, with approval from Missoula County Public Works. The rest of the site is waiting on the upgrade. In other words, a commercial parcel on Highway 93, in one of the most visible locations in town, is being prepared for internet and electricity and nothing more. That's the clearest local evidence that infrastructure is setting the order of development.
The site's history is changing too. The old Lolo School building was donated to the Holt Heritage Center and has been moved from the Highway 93 site to a new home up Highway 12, where it still needs renovation before it can open to the public.
Who pays for the gap
New users pay impact fees, so the remaining question is what existing owners pay. The county's funding plan has four parts:
- Impact fees on new construction. The county says these are expected to generate around $8 million over the next few years, and at least $3 million of the project will be covered by them.
- $1.75 million in federal funding secured by Western Montana's congressional delegation.
- Assessments through a new Rural Special Improvement District that would mirror the boundaries of the existing district, RSID 8901.
- State loan programs, which the county would apply for if the new RSID is created, plus other state and federal sources.
The county's stated goal is "to minimize costs on existing properties already in the sewer and water district." Its posted timeline says the project would go to bid toward the end of 2026, construction would tentatively start in June 2027, and any new assessments would appear on property tax bills in the fall of 2027. That project page was last updated March 17, 2026.
The district is being reshaped at the same time. On February 12, 2026, the commissioners approved changes to the existing RSID 8901 boundary by a 2–0 vote. Two protests were received on the proposed additions, and those parcels were removed. A county update on February 3 said the new capital-improvement district, RSID 490, would go through its public process "sometime this spring." Affected owners would get a postcard, and the commissioners would then consider approving it. Members of the current district have the final say through a protest process.
Since then, the public record shows work moving forward. On June 17, 2026, the commissioners approved two HDR task orders, one for up to $350,000 to design the water and wastewater improvements and one for up to $30,000 for a risk and resilience assessment and emergency response plan. A separate agenda included a reimbursement resolution for the Lolo improvements. We have not found a published record of RSID 490 being formally created, a protest tally, or a per-parcel assessment amount. The county's project page still says the new district is under consideration.
For a buyer, that means a connected home in Lolo has two features. It has a water hookup that new construction can't get right now. It may also be inside a district that could see a new line on its tax bill starting in fall 2027, in an amount no one can quote yet. Both belong in your thinking about price.
The growth number depends on who's counting
You may see a large growth figure attached to this project. KPAX reported in March 2026 that HDR Engineering's impact study found Lolo could see up to 5,400 more dwelling units by 2050. The county's impact fee study uses different units. It projects a service population of 5,364 in 2050 and 802 growth equivalent dwelling units by 2050. These measure different things, and the gap between them is wide. For a buyer's purposes, the county's figure is the one built to match the fee schedule.
How it plays out across three kinds of Lolo property
A resale home already on RSID 901. The connection already exists, and Missoula County's fee schedule says no impact fee applies to an existing hookup. The open items are the boundary map, any future RSID 490 assessment, and whether the home sits within the parcels shown on the county's 2026 district map.
A vacant lot inside the district. This is where the cost gets real. The single-family fees total $17,517 under the current schedule and rise each year starting July 1, 2027, and the county says the water system currently allows no new connections. A buyer should get in writing from Public Works when and how service would be available before treating the lot as buildable on the community system.
A property outside the district. The RSID questions mostly drop away and are replaced by the well, septic, and water-right paperwork that drives acreage deals elsewhere in the Bitterroot. We cover that in the real price of Florence land.
The Lolo neighborhood page has more on the area itself. If you're also comparing city options, Missoula's split market works from a different constraint, a zoning map instead of a water system.
Frequently Asked Questions
Can I build a new home in Lolo and connect to county water today? The county's latest posted language says the water system is at full capacity and no new connections are allowed. Approved projects like Belltower are moving forward under Public Works approval. Confirm the status for a specific parcel with Missoula County Public Works before you commit.
Will existing Lolo homeowners pay the impact fees? No. The county says impact fees apply to new or upgraded connections and are not a tax or assessment on existing properties. Existing properties in the district could see a separate RSID assessment, which the county's timeline puts on tax bills in fall 2027 if the district is created.
How large would that assessment be? No per-parcel amount has been published. The county's process puts the assessment plan after the district creation and protest stages.
Does this affect sewer-only questions? Less so. Updated county data show room for up to 400 new wastewater connections, but repairs are still planned for that system.
None of this is tax, legal, or financial advice. It's the process context that should come before an offer. If you're weighing a Lolo home or lot and want to know how its RSID status and connection history may affect its value, Bethany Taylor can walk you through it as part of a complimentary valuation, including the specific questions to put to the county before you sign.
