Webb to Buchanan/FedEx Consideration201 1st Avenue East
Kalispell, MT 59901
406.758.7703
Fax: 406.758.7758
City of Kalispell • www.kalispell.com
Office of the City Manager
May 19, 2009
Mr. Ronald E. Buchanan
Principal
Devron Property Services, Inc.
120 Derby Forest Court
Roswell, GA 30076
Dear Mr. Buchanan:
I would like to express my appreciation on behalf of the City of Kalispell for your
and FedEx Corporation's consideration of Old School Station Business Park for
the location of a new FedEx Ground facility. This letter will outline the tax
increment funds from the Technology District of Old School Station that will be
made available to you, the developer of the FedEx Ground facility, for the
investment of establishing a new facility and acquiring property within the TIF
District.
Mr. Rick Baloh of Fischer and Company and FedEx Ground have
communicated to us the new facility will be a distribution center employing the
following positions:
• Retained iobs
• 2 FT
7 PT
• New jobs
• 1 new PT position will be added but not until 2014.
• Average wage is $13.81 /hour.
• Also, according to your firm, this facility provides opportunity for 10
delivery routes for independent business owners/contractors in the
Kalispell area who can make upwards in the six figures.
The developer will construct approximately 18,841 square feet on Lot 2 in Old
School Station. Estimates of the water, wastewater, fire and police impact fees,
the utility latecomer fee and the special improvement district fees have been
provided to Mr. Baloh in 2008 based on the information provided to us
regarding lot size, square footage, use and employee count.
The City of Kalispell will provide tax increment funds generated by the FedEx
Ground development to the developer as these funds become available to the
City for the length of the lease contract between the developer and FedEx
Ground.
We understand the proposed lease period is for ten years. Attached is a
proforma of the TIF funds that are allocated for the ten-year specific period. The
benefit over a ten-year period to the developer is estimated at $160,000. The TIF
benefit must be based on actual collection of the tax increment that comes to
the City. Currently we have no avenue to determine the exact calculation since
the reassessment formula is being debated at the Montana Legislature.
However, the City is supportive to provide the increment that is generated by
the FedEx project to the developer as an offset for the cost of the Special
Improvement District assessment. The estimate of $160,000 is the City's best
estimate based on recent and historical property tax collections. The City and
the developer will enter into an incentive agreement to bind the City and the
developer's commitment to the project.
Again, we appreciate the investment you and FedEx are willing to make in our
community.
Sincerely
Webb
Interim City Manager
Cc: Rick Baloh, Fischer and Company, Pittsburgh
Kellie Danielson, Community 8v Economic Development, City of Kalispell
Amy Robertson, Finance Director, City of Kalispell
Charles Harball, City Attorney
Dave Girardot, Representative of Old School Station Business Park
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