MiscellaneousRECOMMENDATION: Based upon our immediate goals to provide funding
f or the youth complex, I recommend approval of the Outlaw Inn
proposal. The total proceeds '•- differential ranges•r': $281,000 to
$390,000 between the two offers (depends upon the length of bond -
1 to 20 years).
ACTION REQUIRED: A MOTION to direct the City Manager/Staff to
proceed with compiling a development agreement that will ''lock -
down" construction schedules and a "legal" minimum tax payment that
will insure us of a revenue stream that can support bond payments.
based upon the projections submitted in their offering documents.
I would suggest a 30 day maximum time frame for reaching such an
agreement. This should assist us in getting "serious" discussion
under way. Of course, the final approval will be completed by a
Council resolution.
Cl'e Y defers de'bt from
By SKIP DUSSEAU
The Daily Inter Lake
A sharply divided Kalispell City
Council Monday agreed to restruc-
ture a revenue deal with Richard
Dasen, developer of the "clocktower"
Southfield Park complex on U.S. 93
South in Kalispell.
Dasen's partnership has failed to
pay on a 1998 contract guaranteeing
the city a minimum income in return
for approval of the project.
The project was delayed and
reduced in scope, resulting in a lower
tax base than envisioned by the city
and the developer. Under the original
agreement, the developer was to pay
the city the difference between the
property taxes the project generated
and $124,000.
Last year, according to City Attor-
ney Glen Neier, the property paid
$59,000 in taxes.
Taxes are assessed on the ba is of
cost, lease income and comparable
properties.
Dasen and at least one council
member, Dale Haarr, say the city was
partially to blame for project delays
that caused tax shortfalls.
/ Flo /
e have cheated
about $200,000 out of
city coffers.
Jim Atkinson
Dasen has assembled a new group
of partners to add buildings to the
site, which will raise the assessed
value of the property and create more
revenue. But Monday's deal defers
any payments to the city until 2003.
clocktower' develo er
V ,
"We have cheated about $200,000
out of the city coffers," irate council
member Jim Atkinson said.
Atkinson voted to approve the
revised deal after others on the coun-
cil warned that failure to do so would
bring court action by the developer.
"We don't want to go down that
track," cautioned Haarr, who :praised
Dasen's office building, calling it "the
best architecture to come to Kalispell
in 50, or maybe even 100 years."
Mayor Bill Boharski called the pact
"the bird in the hand."
Dasen, contacted at his office, said
he is satisfied with the deal but added
that some of his partners were
unhappy about offering the city any-
thing. He said he is confident that
with the new construction, the city
will realize its target tax revenues.
The new contract calls for Dasen to
pay the difference between $148,000
and the taxes collected from the prop-
erty, beginning in 2003.
Council member Fred Leistiko,
who panned the agreement, said he .
does not trust Dasen and criticized
the pact for failing to provide guarani
tees, such as a lien on the property.
"Is the man's word on this one as
good as on the last one?" he asked. {
A. /06
bz_
Southfield Towers Development Agreement Notes
July - Met with Dick Dason in my office to discuss the development agreement. Dick indicated
that he understood that he was in default but could not pay total amount due. He is interested in
finding a way to resolve this dispute. He said he would get back with me on this.
July - stopped by Dick's office and spoke with him regarding his default. At the time I asked
Dick to get me something in writing. He indicated that he would get a letter soon. I expressed
the need to cover the City's indebted ness and set a schedule for future payments
July - still nothing in writing, stopped by Dick's office and meet with he and two Watti's. They
complained about the City never doing anything for them and that they could not payback the City
at that time. Accused the City of undercutting their deals. They provided no specifics. Watti
wanted a guarantee that if they paid the City the funds would be used to extend water and sewer
to four corners. I told him that he had no business telling the City how to use the money that
Dason owed us.
August 2, 2000 - letter to Dason offering an amendment to the agreement to help us avoid
litigation since he is currently in default of the agreement. Leiter asked for his response within ten
days.
August - placed at least two messages on Dick's answering machine. No response. I also
stopped by the office and left messages on at least one occasion.
September 13, 2000 - Called Dick Dason to find out what was going on with response to my
August 2 letter. He said that I would here back from him tomorrow (Sept. 14)
September 14, 2000 - At 4:30 pm I called Dick Dason's office. I left a message on his machine
asking him what I needed to do to.
September 14, 2000 - At 4:40 Dason's attorney called to tell me that he was meeting with his
client on Tuesday of next week. He would not give me a date of when I would here back from
him. I tried to get a commitment of next Friday but he refused, only to say that I would get
something soon. I asked if the agreement were between Dick Dason personally, vs an LLC or
Corp. and he agreed that it was a personal obligation.
He said that the previous administration had made an unwritten agreement with them. He did not
elaborate on the unwritten agreement other than to indicate that I was causing the problem by not
living up to it. I guess this means from their perspective that they do not owe the city any money.
September 25, 11:30am - Meeting with Peak Development regarding Papa Johns and Exxon.
Left a message for Dick Dason to call me. I have heard nothing
iqiiiiiiiiiq
;0
►�IZIZI , � : �
October 18, 2000
Southfield Park Tax Roll
0001977
$
5,010.69
0001978
$
2,808.43
0001979
$
2,994.35
0001980
$
3,713.25
0001981
$45.189.63
$59,716.35
Per contract Mr Dasen owes the City $64,283.65 ($124,000 - $59,716.35 = $64,283.65)
$ 124,000.00
2000 REALS
Taxes billed Difference Due
75-0001977
Lot 1
$ 5,010.69
75-0001978
Lot 2
$ 2,808.43
75-0001979
Lot 3
$ 2,994.35
75-0001980
Lot 4
$ 3,713.25
75-0001981
Lot 5
$45,189.63
$59,716.35 $ 64,283.65
1999 REALS
75-0001977
Lot 1
$ 4,808.84
75-0001978
Lot 2
$ 2,695.30
75-0001979
Lot 3
$ 2,873.73
75-0001980
Lot 4
$ 3,563.67
75-0001981
Lot 5
$11,803.87
$25,745.41 $ 98,254.59
1998 REALS
75-0001115 Lots 1-5 $13,302.08
$ 110,697.92
$ 273,236.16
dasentaxdue.xls 10/20/00