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H4. Resolution 6087, Downtown_Westside ROIKALisPEii. Development Services Department 201 1st Avenue East Kalispell, MT 59901 Phone: (406) 758-7940 Fax: (406) 758-7739 www.kalispell.com/plannine REPORT TO: Doug Russell, City Manager FROM: Jarod Nygren, Development Services Director SUBJECT: KRD-22-01 — Amend the Downtown Urban Renewal Plan and the West Side/Core Area Urban Renewal Plan to include work force housing as projects eligible for Tax Increment Financing. MEETING DATE: August 1, 2022 BACKGROUND: On December 17, 2012, Kalispell City Council adopted the Core Area Plan as an amendment to the City of Kalispell Growth Policy 2020 by Resolution No. 5601A. The Core Area Plan addresses needs and priorities affecting redevelopment of the Core Area. On December 4, 2017, Kalispell City Council adopted The Downtown Plan as an amendment to the City of Kalispell Growth Policy Plan -It 2035 by Resolution No. 5846. Additionally, City Council adopted the West Side Urban Renewal -Core Area plan by Ordinance 1717 (Original Ordinance 1259) and the Downtown Urban Renewal Plan by Ordinance 1816. The City of Kalispell utilizes a Tax Increment Finance District (TIFD) within both urban renewal plan boundaries as part of the overall strategy to meet its needs of promoting economic development, improving area employment opportunities, improving area housing opportunities, and expanding the community's tax base. Since adoption of both plans, Kalispell has experienced significant population growth as documented by the US Census and further indicted by Kalispell being named the fastest growing micropolitan area in the nation. This population growth has exacerbated housing shortages which were already reflected by near zero percent vacancy rates across the city for years. To mitigate impacts associated with the rapid growth and address blighted conditions within the plan boundaries, the city is considering including the creation of workforce housing for individuals and families with household income of 80% to 120% of area median income in both the Downtown and West Side/Core Area Urban Renewal Plans. Identified workforce housing projects created within both plan boundaries would promote area housing and employment opportunities. Work force housing is an eligible expense within a TIF District per Section 7-15-4288 (4), Montana Code Annotated (MCA). Section 7-15-4213 MCA requires that prior to the approval of an urban renewal project, the local governing body shall submit the project to the planning board for review and recommendations as to its conformity to the urban renewal plan and Growth Policy of the city. Accordingly, the Kalispell Planning Board held a duly noticed public hearing July 12, 2022, to consider work force housing as an eligible project. Staff presented a report providing details of the proposal and evaluation. Staff recommended that the Planning Board adopt the submitted report as findings of fact, determining that work force housing is supported by both the Downtown and West Side/Core Area Urban Renewal Plans and is in conformity with the Kalispell Growth Policy Plan -It 2035 and forward this recommendation to the Kalispell City Council for their consideration. There being no public testimony, a motion was presented to adopt staff report #KRD-22-01 and recommend to the Kalispell City Council that the proposed amendments to the Downtown and West Side/Core Area Urban Renewal Plans be adopted as provided. Board discussion concluded that the project was appropriate, and the motion passed on roll call vote. Additionally, the Kalispell Urban Renewal Agency held a meeting on July 20, 2022, to consider the work force housing as an eligible project in both urban renewal plans. Staff presented details of the proposal and evaluation. A motion was presented to include work force housing as an eligible project within both the Downtown and West Side/Core Area Urban Renewal Plans. Discussion concluded that the project was appropriate, and the motion passed on roll call vote. RECOMMENDATION: It is recommended that the Kalispell City Council approve Resolution 6087, a resolution setting a public hearing date of August 15, 2022, where the Kalispell City Council intends to take public comment on amending the Downtown Urban Renewal Plan and the West Side/Core Area Urban Renewal Plan to include work force housing as projects eligible for Tax Increment Financing in accordance with the Kalispell Growth Policy Plan It-2035. FISCAL EFFECTS: There are no anticipated fiscal impacts at this time. ALTERNATIVES: Deny the request. ATTACHMENTS: Resolution 6087 July 12, 2022, Kalispell Planning Board Minutes Staff Report KRD-22-01 c: Aimee Brunckhorst, Kalispell City Clerk RESOLUTION NO. 6087 A RESOLUTION CALLING FOR A PUBLIC HEARING ON THE PROPOSED AMENDMENTS TO THE DOWNTOWN URBAN RENEWAL PLAN AND THE WEST SIDE/CORE AREA URBAN RENEWAL PLAN TO INCLUDE WORK FORCE HOUSING AS PROJECTS ELIGIBLE FOR TAX INCREMENT FINANCING AS RECOMMENDED BY THE KALISPELL CITY PLANNING AND ZONING BOARD. WHEREAS, the City of Kalispell, Montana (the "City") is authorized by Montana Code Annotated, Title 7, Chapter 15, Parts 42 and 43, as amended (the "Act"), to create an urban renewal area, to undertake urban renewal projects therein, to provide for the segregation and collection of tax increment with respect to property taxes collected in the urban renewal area, to issue its bonds to pay the costs of such projects and to pledge to the repayment of the bonds the tax increment derived from the urban renewal area; and WHEREAS, in accordance with the provisions of the Act, on December 17, 2012, Kalispell City Council adopted the Core Area Plan as an amendment to the City of Kalispell Growth Policy 2020 by Resolution No. 5601A, and on December 4, 2017, Council adopted The Downtown Plan as an amendment to the City of Kalispell Growth Policy Plan -It 2035 by Resolution No. 5846, both after duly mailed and published notice and a public hearing and receipt of recommendations from the Kalispell City Planning and Zoning Board, which certified that the Urban Renewal Plans conform to the general plan for the development of the City as a whole and the comprehensive plan of the City for the areas containing the Urban Renewal Areas; and WHEREAS, City Council adopted the West Side Urban Renewal/Core Area plan by Ordinance 1717 (Original Ordinance 1259) and the Downtown Urban Renewal Plan by Ordinance 1816; and WHEREAS, since the adoption of both plans, Kalispell has experienced significant population growth as documented by the US Census, which has exacerbated housing shortages which were already reflected by near zero percent vacancy rates across the City for years; and WHEREAS, to mitigate the impacts associated with the rapid growth and address blighted conditions within the Plan boundaries, the City is considering including the creation of workforce housing for individuals and families with household income of 80% to 120% of area median income in both the Downtown and West Side/Core Area Urban Renewal Plans; and WHEREAS, pursuant to MCA 7-15-4213, on July 12, 2022, the Kalispell Planning and Zoning Board took public comment on the amendments to the West Side/Core Area Urban Renewal Plan and the Downtown Urban Renewal Plan at a noticed public hearing, reviewed and considered them as to their conformity with the Kalispell Growth Policy Plan -It 2035 and transmitted them to the City Council with the finding that work force housing is supported by both the Downtown and West Side/Core Area Urban Renewal Plans and is in conformity with the Kalispell Growth Policy Plan - It 2035 and should be adopted by the City Council; and WHEREAS, an Ordinance has been proposed to be adopted by this Council which would amend the Downtown Urban Renewal Plan and the West Side/Core Area Urban Renewal Plan to include work force housing as an eligible project in both Urban Renewal Plans as recommended by the Kalispell City Planning and Zoning Board; and WHEREAS, under Sections 7-15-4214, 7-15-4215 and 7-15-4221 of the Act, it is necessary to conduct a public hearing on the amendments to the Urban Renewal Plans and approval of any of the Urban Renewal Projects therein. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF KALISPELL AS FOLLOWS: SECTION 1. Public Hearing. On August 15, 2022, at 7:00 p.m., in the Council Chambers in the Kalispell City Hall, the City Council will conduct a public hearing on the proposed amendments to the Downtown Urban Renewal Plan and the West Side/Core Area Urban Renewal Plan to include work force housing as projects eligible for Tax Increment Financing in accordance with the Kalispell Growth Policy Plan It — 2035 as recommended by the Kalispell City Planning and Zoning Board. SECTION 2. Notice of Public Hearing. The City Clerk is hereby authorized and directed to publish a copy of the Notice of the Public Hearing in substantially the form attached hereto as Exhibit "A" (which is hereby incorporated herein and made a part hereof) twice in The Daily Interlake, the official newspaper of the City and published in Flathead County, Montana, with not less than six days separating each publication date, and to mail a copy of said notice, not less than 10 days before the date of the public hearing, to every person or entity whose names appear on the County Treasurer's tax roll as the owners, reputed owners, or purchasers under contracts of deed of real property within the Urban Renewal Areas at the addresses shown on the tax roll. PASSED AND APPROVED BY THE CITY COUNCIL AND SIGNED BY THE MAYOR OF THE CITY OF KALISPELL, THIS 1 ST DAY OF AUGUST, 2022. ATTEST: Aimee Brunckhorst, CMC City Clerk Mark Johnson Mayor CITY OF KALISPELL, MONTANA NOTICE OF PUBLIC HEARING NOTICE IS HEREBY GIVEN that the City Council (the "Council") of the City of Kalispell, Montana (the "City") will hold a public hearing on the proposed amendments to the Downtown Urban Renewal Plan and the West Side/Core Area Urban Renewal Plan (the "Plans") to include work force housing as projects eligible for Tax Increment Financing on August 15, 2022, at 7:00 p.m., in the Council Chambers in the Kalispell City Hall, 201 Ist Avenue East, Kalispell, Montana. The Plan amendments relate to both the Downtown Urban Renewal Plan and the West Side/Core Area Urban Renewal Plan. The proposed amendments to the Plans are to include work force housing as projects eligible for Tax Increment Financing within both the Downtown Urban Renewal Plan and the West Side/Core Area Urban Renewal Plan. The amendments are designed to mitigate impacts associated with the City's rapid growth and address blighted conditions within the plan boundaries. On August 15, 2022, at 7:00 pm in the City Hall Council Chambers, 201 First Avenue East, Kalispell, the Kalispell City Council will hold a public hearing regarding the proposed amendments to the Downtown Urban Renewal Plan and the West Side/Core Area Urban Renewal Plan. The proposed amendments can be viewed on the City's website at www.kalispell.com/679/Council-Public-Hearings or in the office of the City Clerk at 201 First Avenue East, Kalispell. Any person wishing to address the proposed amendments may appear at this hearing and make oral statements or present same in writing. Written comments may also be submitted for council consideration by delivering the same to the City Clerk at 201 First Avenue East, Kalispell, MT 59901, or by email to publiccommentgkalispell.com prior to the hearing. For additional information please contact the City Clerk at (406) 758-7756. Aimee Brunckhorst, CMC City Clerk Publish: August 7, 2022 August 14, 2022 KALISPELL CITY PLANNING BOARD & ZONING COMMISSION MINUTES OF REGULAR MEETING JULY 12, 2022 CALL TO ORDER AND ROLL The regular meeting of the Kalispell City Planning Board and Zoning CALL Commission was called to order at 6:00 p.m. Board members present were Doug Kauffman, Rory Young, Joshua Borgardt, Burke, and Kevin Aurich. PJ Sorensen, Kari Barnhart, Katharine King, and Jarod Nygren represented the Kalispell Planning Department. APPROVAL OF MINUTES Young moved and Burke seconded a motion to approve the minutes of the June 14, 2022, meeting of the Kalispell City Planning Board and Zoning Commission. VOTE BY ACCLAMATION The motion passed unanimously on a vote of acclamation. HEAR THE PUBLIC None. KA-22-06 — BAILEY File #KA-22-06 — A request from William and Simone Bailey for ANNEXATION annexation and initial zoning designation of R-3 (Residential). The annexation is to allow the property to be connected to city sewer due to a failing septic system. The property is located at 1788 South Woodland Drive. STAFF REPORT PJ Sorensen representing the Kalispell Planning Department reviewed Staff Report # KA-22-06. Staff recommends that the Kalispell City Planning Board and Zoning Commission adopt Staff Report #KA-22-06 as findings of fact and recommend to the Kalispell City Council that the property be annexed and the zoning for the property be city R-3 (Residential). BOARD DISCUSSION None. PUBLIC HEARING Bill Bailey — 1788 S. Woodland Drive — Expressed his wishes to have his property annexed into the City due to his failing septic sstem. MOTION Burke moved and Young seconded a motion that the Kalispell City Planning Board and Zoning Commission adopt Staff Report #KA-22-06 as findings of fact and recommend to the Kalispell City Council that the property be annexed and the zoning for the property be city R-3 (Residential). BOARD DISCUSSION None. ROLL CALL Motion passed unanimously on a roll call vote. KRD-22-01— WEST SIDE & A report to the Kalispell City Planning Board and the Kalispell City DOWNTOWN URBAN RENEWAL Council regarding a request to amend the Downtown Urban Renewal Plan PLAN PROJECT AMENDMENT and the West Side/Core Area Urban Renewal Plan to include work force housing as prqjects eligible for Tax Increment Financing. STAFF REPORT Jarod Nygren representing the Planning Department reviewed Staff Report KRD-22-01. Staff recommends that the Kalispell City Planning Board adopt staff report #KRD-22-01 as findings of fact, determining that work force housing is supported by both the Downtown and West Side/Core Area Urban Renewal Plans and is in conformity with the Kalispell Growth Kalispell City Planning Board Minutes of the meeting of July 12, 2022 Pagel Policy Plan -It 2035 and forward this recommendation to the Kalispell City Council for their consideration. BOARD DISCUSSION Young asked for a general explanation of how TIF (Tax Increment Financing) generates funds. Borgardt requested information on the URA (Urban Renewal Agency). PUBLIC HEARING None. MOTION Young moved and Aurich seconded a motion that the Kalispell Planning Board adopt staff report #KRD-22-01 and recommend to the Kalispell City Council that the proposed amendment be adopted as provided. BOARD DISCUSSION Young stated that this amendment is good for the city. Kauffman stated that this amendment will be another tool that would allow for a potential developer to request TIF for workforce housing. ROLL CALL Motion passed unanimously on a roll call vote. OLD BUSINESS Nygren updated the board on the recent city council meeting. NEW BUSINESS Nygren updated the board on the September planning board meeting. There will be no meeting in August. ADJOURNMENT The meeting adjourned at approximately 6:31pm. Chad Graham President APPROVED as submitted/amended: Kirstin Robinson Recording Secretary Kalispell City Planning Board Minutes of the meeting of July 12, 2022 Page 12 DOWNTOWN AND WEST SIDE/CORE AREA URBAN RENEWAL PLAN AMENDMENTS REQUEST FOR DOWNTOWN URBAN RENEWAL PLAN AMENDMENT AND WEST SIDE/CORE AREA URBAN RENEWAL PLAN AMENDMENT STAFF REPORT #KRD-22-01 KALISPELL PLANNING DEPARTMENT July 6, 2022 A report to the Kalispell City Planning Board and the Kalispell City Council regarding a request to amend the Downtown Urban Renewal Plan and the West Side/Core Area Urban Renewal Plan to include work force housing as projects eligible for Tax Increment Financing. A public hearing has been scheduled before the Kalispell City Planning Board for July 12, 2022, beginning at 6:00 PM in the Kalispell City Council Chambers. The planning board will forward a recommendation to the Kalispell City Council for final action. BACKGROUND INFORMATION: The City of Kalispell, Development Services staff is requesting an amendment to both the Downtown and West Side/Core Area Urban Renewal Plans to include work force housing as an eligible project. This report will analyze the proposal in accordance with state law and adopted city policies. On December 17, 2012, Kalispell City Council adopted the Core Area Plan as an amendment to the City of Kalispell Growth Policy 2020 by Resolution No. 5601A. The Core Area Plan addresses needs and priorities affecting redevelopment of the Core Area. On December 4, 2017, Kalispell City Council adopted The Downtown Plan as an amendment to the City of Kalispell Growth Policy Plan -It 2035 by Resolution No. 5846. Additionally, City Council adopted the West Side Urban Renewal -Core Area plan by Ordinance 1717 (Original Ordinance 1259) and the Downtown Urban Renewal Plan by Ordinance 1816. The City of Kalispell utilizes a Tax Increment Finance District (TIFD) within both urban renewal plan boundaries as part of the overall strategy to meet its needs of promoting economic development, improving area employment opportunities, improving area housing opportunities, and expanding the community's tax base. Since adoption of both plans, Kalispell has experienced significant population growth as documented by the US Census and further indicted by Kalispell being named the fastest growing micropolitan area in the nation. This population growth has exacerbated housing shortages which were already reflected by near zero percent vacancy rates across the city for years. To mitigate impacts associated with the rapid growth and address blighted conditions within the plan boundaries, the city is considering including the creation of workforce housing for individuals and families with household income of 80% to 120% of area median income in both the Downtown and West Side -Core Area urban renewal plans. Identified workforce housing projects created within both plan boundaries would promote area housing and employment opportunities. Work force housing is an eligible expense within a TIF District per Section 7-15-4288 (4), Montana Code Annotated (MCA). Petitioner / Owner: City of Kalispell Development Services Department P.O. Box 1997 Kalispell, MT 59903 (406) 758-7940 Planning Board Review Authority: Section 7-15-4213(1), MCA states that prior to the approval of an urban renewal project, the local governing body shall submit the urban renewal project to the planning board for review and recommendations as to its conformity with the urban renewal plan and Growth Policy of the city. Description of District Boundaries: The Downtown Urban Renewal District is an approximately 95-acre area under multiple ownerships. Starting at the intersection of 3d Avenue West and 1" Street the plan is bound by heading easterly on 1 st Street until 3rd Avenue East, thence southerly along 3rd Avenue East until the intersection with 4th Street, thence westerly along 4th Street until 2nd Avenue East, thence southerly along 2nd Avenue East until 5th Street, thence Westerly along 5th Street until 1st Avenue East, thence southerly along 1st Avenue East until 9th Street, thence westerly along 9th Street until 1st Avenue West, thence northerly along 1st Avenue West until 5th Street, thence westerly along 5th Street until 2nd Avenue West, thence northerly along 2nd Avenue West until 4th Street, thence westerly along 4th Street to 3rd Avenue West, thence northerly along 3rd Avenue West until the point of beginning. The West Side/Core Area Plan melds two linked areas under one. The initial West Side Urban Renewal Plan area is originally identified as the North Meridian Neighborhood. That area generally covers an area bounded by US Highway 2 on the south; US Highway 93 and Wedgewood Lane on the north; 7th Avenue WN on the east; and Hawthorne Avenue and northern Lights Blvd on the west. The Core Area portion of this plan is approximately 365-acres under multiple ownerships. This area is identified as the area affected by the Kalispell Parkline traversing central Kalispell from east to west bounded by 1st Street on the South, U.S. 2 viaduct on the east, Meridian on the West and Washington Street on the north. Plan boundaries illustrated in FIGURES below: Wegggstside TIF- City of Kalispell - WegsideTl gi~.US VI �,; 2 ^e DOWNTOWN URBAN RENEWAL PLAN AND WEST SIDE CORE AREA URBAN RENEWAL PLAN AMENDMENT ANALYSIS: Population in the City has been growing significantly over the past five years and Kalispell was recognized in 2022 as the fastest growing micropolitan area in the nation by the U.S. Census. Over the past decade Kalispell rental housing has been below 2% vacancy rates and at or near 0% vacancy rates at certain times. Further, construction of new housing units of all types has not yet recovered to pre -Great Recession levels, which is a nationwide trend. Limited availability of housing of all types and price points has driven home prices and rental rates up by double digits such that many locally earned wages are no longer sufficient to cover housing costs at 30% of household income. Therefore, the City of Kalispell is proposing to amend the Downtown and Westside/Core Area Urban Renewal Plans to include workforce housing as projects where TIF could be used to mitigate existing workforce housing issues. Flathead County Median Income for FFY 2022 Estimated County Area Median Income (AMI) for a 4-person family Low (80%) of Estimated County Median Income 1-Person Family 2-Person Family 3-Person Family 4-Person Family $80,300 $44,450 $50,800 $57,150 $63,500 Moderate (120%) of Estimated County Median Income $66,700 1 $76,200 1 $85,750 $95,300 The term "work force housing" is often used to indicate a program targeted at households earning too much to qualify for traditional affordable housing subsidies. The U.S. Department of Housing and Urban Development (HUD) programs generally serve those earning less than 80% of median income for their metropolitan area. Relative to those programs, "workforce housing" is intended to serve those between 80% and 120% of area median income (AMI). Generally, housing is said to be affordable when it is no more than 30% of a household's gross income where housing costs include rent or mortgage payments, utilities, property taxes and insurance as applicable. Therefore, in 2022 a 4-person household at 80% AMI in Flathead County would be able to afford a monthly housing cost of $1,587 while the 4-person household at moderate income would be able to afford $2,382 per month for total housing costs. In the case of a 4-person household at 80% of AMI, provided the market rate for a 3-bedroom residential unit is $2,000 per month, there is a gap of $413 dollars. As being proposed the $413 dollar gap would be eligible for TIF assistance provided all TIF policies and procedures were followed in accordance with Resolution 5955 (Downtown and West Side/Core Area Tax Increment Financing Assistance Program). Details of each request from a developer would have to be analyzed for accuracy and financial feasibility with each TIF application. Each application would then be reviewed by the Kalispell Urban Renewal Agency in accordance with adopted policies and procedures with a recommendation to the Council. Lastly, as proposed the inclusion of work force housing as an eligible project is not being mandated, but simply included as an eligible TIF request for workforce housing within either of the urban renewal plan boundaries. Rent Affordability Examples at 80% and 120% AMI below: 3 % Area Median Annual Income Hourly Wage Est Affordable Monthly Income 2022 (Gross) (assuming 1 wage earner Rent For a 4-Person working 40 hours per (30% gross monthly Household week) income) 80% $63,500 $30.53 $1,587 120% $95,300 $45.82 $2,382 A November 2021 market study conducted for the Junegrass Place Apartments project found that "all existing income restricted projects in Kalispell are 100% occupied," with all having waiting lists ranging from 14-25 names on the senior housing projects ad 40-100+ names on the family projects. This study found that, "From 2000 to 2021, the primary market area population has increased by 43.2 % or 2.1 % annually and is projected to grow by 1.1 % per year on average from 2021 to 2026. Rents in the area have increased by 18 - 33 % from July 2020 to July 2021. As rents continue to increase, it is becoming increasingly difficult for very low to moderate income households to find and afford housing. According to the 2015 to 2019 American Community Survey, 44.4 % of renter households in the City pay more than 30 % of their income to rent (rent - overburdened), with 34.1 % paying 35 % or more, and 19.4 % paying 50 % or more." PLANINNG BOARD FINDING OF CONFORNHTY OF THE PROPOSED PROJECT TO THE DOWNTOWN URBAN RENAWAL PLAN AND CORE AREA PLAN: The Downtown Urban Renewal Plans guide the potential allocation of tax increment finance district funds to develop projects addressing plan goals. Relevant plan statements are referenced below: Under blight findings of fact, the Downtown Urban Renewal Plan states: a. The substantial physical dilapidation, deterioration, age, obsolescence, or defective construction, material, and arrangement of buildings or improvements, whether residential or nonresidential. Under growth policy, goals, the Downtown Urban Renewal Plan states: 2. Encourage the development and redevelopment in the downtown. Under growth policy, policies, the Downtown Urban Renewal Plan states: 9. Redevelopment is encouraged to integrate a variety of residential housing types to accommodate people of different age groups and income levels. 11. Promote a mix of uses in downtown buildings emphasizing retail uses on the main floor and offices or residential uses on upper floors. The Downtown Urban Renewal Plan identifies the need for safe housing in the downtown area and the importance of incentivizing development of varied housing types and price points as keys to revitalization of the area. By making tax increment financing available to support appropriate projects within the urban renewal plan boundary, the city creates the mechanism to address the goals and policies of both urban renewal plans. M The Core Area Plan guides the City with Vision and Goal statements where TIF funding could ultimately be used provided a work/project plan is implemented. Relevant Core Area Plan statements are referenced below: Chapter 3 Vision and Goals in Action, Goal 7, Housing Strategy An array of housing options in the Core Area (multi family, apartment buildings, townhouse and row housing, loft and studio apartments, senior housing, second floor residential, smaller scale multi- family apartments, etc) to provide housing for a variety of age and income levels. Chapter 3 Vision and Goals in Action, Goal 7, Housing Reinvestment Strategy A housing stock that is safe, affordable and an asset to the neighborhood. PLANINNG BOARD FINDING OF CONFORNHTY OF THE PROPOSED PROJECT TO THE KALISPELL GROWTH POLICY PLAN -IT 2035: Prior to approval of an urban renewal project, the local governing body shall submit the urban renewal project plan and project to the planning commission of the municipality for review and recommendations as to its conformity with the growth policy. Accordingly, the Planning Board is tasked with reviewing the project in conformance with the City of Kalispell Growth Policy Plan - It 2035 and making such a recommendation to the City Council. The Kalispell Growth Policy Plan -It 2035 supports the proposed project and the project can be found to be compliant with the following plan provisions: Chapter 4, Land Use —Goal 1, Provide an adequate supply and mix of housing that meets the needs of present and future residents in terms of cost, type, design, and location. As referenced in the studies above, it has become increasingly difficult from individuals and families with low to moderate incomes to find housing. Inclusion ofworkforce housing as an eligible TIF project would give developers the option of providing housing below market rate opening up housing opportunities that might not otherwise exist. Chapter 4, Land Use —Policy 2, City regulations should maintain incentives to provide for varied affordable housing types. Inclusion of work force housing as a TIF eligible project provides an incentive to developers to provide housing at a rental rate that is not currently in place. Chapter 4, Land Use —Recommendation 1, Develop and implement an affordable housing strategy to effectively provide for the needs of low and moderate -income residents. Inclusion of work force housing as a TIF eligible project provides an incentive to developers to provide housing at below market rate potentially providing for low and moderate -income residents. Chapter 4, Land Use —Issue 4, Rental vacancy rate is below 2% leaving few rental options and increased rental prices. Vacancy rates currently hover just over 0%, which drives up rent prices because of a lack of supply. Subsidizing rent rates through TIF gives an option to push rental rates down despite the current market conditions, opening up housing options for those that otherwise might not be able to afford it. Chapter 1, The Economy —Issue 5, Healthcare, retail, government, and accommodations/food service sectors of the economy provide the employment base for Kalispell and are responsible for creating most of the new jobs in the area. The employees in the sectors above typically have salaries in the 80-120% AMI range. Inclusion of workforce housing as a TIF eligible project would potentially offer housing opportunities for these sectors. Chapter 1, The Economy —Goal 2, Monitor the growth trends within the valley in order to be in tune with the changing economy. Vacancy rates currently hover just over 0%, which drives up rent prices because of a lack of supply. Subsidizing rent rates through TIF gives an option to push rental rates down despite the current market conditions. Chapter 1, The Economy —Policy 5, Support the Kalispell area's position as a regional commercial center and a location of major healthcare, government, industrial facilities, and retail services. The employees in the sectors above typically have salaries in the 80-120% AM range. Inclusion of workforce housing as a TIF eligible project would potentially offer housing opportunities for these sectors. Employers have increasingly found it difficult to recruit employees due to the lack of attainable housing in the valley and this could help mitigate that issue in some instances. Chapter 1, The Economy —Recommendation 1, Support public/private partnerships to strengthen commercial districts within the city. Any request for TIF assistance for workforce housing would be coordinated through the city's TYpolicies andprocedures. Through theprocess, any allocation ofTIFfunds would be vetted and ultimately agree upon through a Developer's Agreement outlining the roles and responsibilities of both the City and developer requesting workforce housing TIF assistance. The Kalispell Growth Policy Plan -It 2035 recognizes the importance of availability and housing throughout the community and calls for action on the part of the city to address those needs for all income levels. Identifying work force housing in the urban renewal plans for both the Downtown and Westside/Core Areas is consistent with the priorities expressed in the growth policy. 0 CONCLUSION: The proposed amendment to include workforce housing as an eligible project does comply with the expressed intent and the goals, policies, and recommendations of both the Downtown Urban Renewal Plan and Westside/Core Area Urban Renewal Plan and the Goals and Policies of Kalispell Growth Policy Plan -It 2035. RECOMMENDATION: Staff recommends that the Kalispell City Planning Board adopt staff report #KRD-22-01 as findings of fact, determining that work force housing is supported by both the Downtown and West Side/Core Area Urban Renewal Plans and is in conformity with the Kalispell Growth Policy Plan -It 2035 and forward this recommendation to the Kalispell City Council for their consideration. ALTERNATIVES: Deny the request. ATTACHMENTS: Downtown Plan and Downtown Urban Renewal Plan Core Area Plan and West Side/Core Area Urban Renewal Plan 7