Sorensen/AnnexationTO: CHRIS KUKULSKI, CITY MANAGER
FROM: PJ SORENSEN, ZONING ADMINISTRATOR
DATE: AUGUST 2, 2000
RE: VILLAGE GREENS ANNEXATION
SUMMARY OF ATTACHMENTS
I have attached a number of maps to this memo, many of which have their own
attachments. Each of the phases which have gone to final plat have the plats included. Attached
to each plat are the consents, applicable covenant language, and other related information which
are relevant to annexation. You will also notice that I placed checks on the lots which have
homes either constructed or under construction. There is also a summary on each plat of the
number of lots, the number of lots with homes or homes under construction, the percentage of
lots with homes or homes under construction, and the approximate percentage of area which has
been developed to its intended use (including roads, parks, etc). I did not include a map of the
golf course, which may be included in the annexation proposal.
There is also a summary map which shows the all phases and is color coded to show (a)
areas which have filed consents; (b) areas which have executed consents that have not been filed;
(c) areas which have filed covenants stating that consents have been executed, but for which no
such consents could be located; and (d) none of the above. Additionally, I have included a copy
of the sewer district agreement and relevant portions of the Montana Code sections on
annexation.
NEED TO BE CONTIGUOUS
Although Village Greens is close to the City, it is not contiguous. Therefore, we will need
to include an area outside of Village Greens to make the connection regardless of which method
we choose to use. There are various options. Perhaps the most straight forward is annexing a
portion of Tract 5 (and perhaps 5A) along West Evergreen Drive. We could also use West
Evergreen itself (which would then involve a separate annexation procedure for contiguous
government land). We could take in property along the southern side of West Evergreen (even
though it is separated by the road, it is still considered contiguous under Sec. 7-2-4301 and Sec.
7-2-4704(1) ). We could also do an end -around by taking in property on the east side of
Whitefish Stage to connect with Village Greens Phase IV.
After our conversation, I checked with the plat room and the Secretary of State. Kal-
Mont Dairy still owns Tract 5. James and Karen Holmquist own Tract 5A. George Schultz is
still shown as an officer and member of the Board for the Dairy, and most of the other people
associated with the business appear to be family members. Since he has been a key individual in
the Village Greens development, we would not be bringing in someone foreign to the matter. The
land, however, is not part of the sewer district and does not have a consent on file.
If you chose not to take in Tract 5 and did not want to entangle yourself with property
owners not associated with Village Greens, the only other viable option is the annexation of West
Evergreen Drive. If we were to annex the road, we will need to take a two-step approach. First,
we would annex the road through annexation of contiguous government land. Then, we could
annex Village Greens by annexation of contiguous land.
INCOMPLETE RECORDING OF DOCUMENTS
One of our primary obstacles is the inconsistent execution and recording of consents to
annex. As you can tell from the summary map, not all of the area to be annexed is directly subject
to a recorded consent. However, all but two lots have some sort of notice in the chain of title that
indicates that the developer consented to annexation, either with the consent itself being recorded
or by mention in the covenants. A breakdown of the numbers is as follows:
Filed Consent: Phases I, II, IIIA, IV, IX: 159 lots (including sublots)
Unfiled Consent: Phases VII, X: 29 lots (including sublots)
Covenants Only: Phases III, V, VIII: 86 lots (including sublots)
Nothing: Phase IIIB: 2 lots
Including sublots, there are 276 lots within Village Greens, plus designated common area,
the golf course with the clubhouse and other associated lots, and any parcels necessary to make
the area contiguous. We should have more than 50% of the lots covered with filed consents,
depending upon the exact lots which are included. A final count should be done once the lots are
determined to ensure we have the majority of lots covered with recorded consents.
We may also have an additional 115 lots covered because, even though there was not an
express written consent filed, there is notice in the chain of title that the developer consented to
annexation and that the lot is subject to annexation. If the developer did not actually sign a
consent, I believe it can be argued that the developer gave at least implied consent when (a) a
condition of the preliminary plat is the execution of a consent; (b) the representation is made to
the County Commissioners by FRDO that consents have been executed without contradiction by
the developer; and (c) final plat is granted based in part upon that representation. There is not
much precedent which addresses this situation, although the argument is given a boost by the
recent Whitefish decision that recognized a form of implied consent to annex.
It may be a moot point, since there are would be a majority of lots with consents in any
case, but if the above implied consent argument fails, there may be a basis to argue that the
continued receipt of city services provides implied consent. It would definitely be a fallback
position, and I can put together an argument for it if necessary.
A VAILA BLE METHODS OF ANNEXATION
Under the Montana Code, there are several potential methods of annexation: annexation
of contiguous land, annexation of contiguous government land, annexation of wholly surrounded
land, annexation by petition, and annexation with the provision of services. For your reference, I
have included the code sections for each method.
For this particular matter, annexation of wholly surrounded land and by petition do not
apply. Annexation of contiguous government land will apply in the event that we need to annex
West Evergreen Drive, but only to the extent that the right-of-way would be involved. That
leaves us with two options: annexation of contiguous land and annexation with provision of
services. I believe that the contiguous method is much more straight forward and would
accomplish our time objectives, while the provision of services method is more complex with
additional elements which may not meet our time objectives. Although you should certainly
coordinate with Narda since she would be the person to process the annexation, I believe that the
contiguous method best serves our present needs.
Annexation of contiguous land is governed by Title 7, ch. 2, part 43 of the Montana Code.
Under that part, a city can annex contiguous land that has been or may be platted (the map or plat
of which is filed with the clerk and recorder) or unplatted land that has been surveyed and for
which a certificate of survey has been filed. Sec. 7-2-4311.
The first step is a resolution of intent by the city council under Sec. 7-2-4312. Once it has
passed, we need to immediately notify all registered voters in the area to be annexed. We will
also need to publish notice in the paper once a week for two successive weeks. The notice must
provide a period of 20 days after the publication of the first notice that the city clerk will accept
written comments from the registered voters in the area. Sec. 7-2-4313.
At the first regular meeting after the expiration of the 20 day comment period, the
comments are to be forwarded to the council for its consideration. Sec. 7-2-4314(1)(a). If 300
or more parcels are included, the matter must be referred within 45 days to the voters after
approval by the council. Sec. 7-2-4314(1)(b) and (c). If there are fewer than 300 parcels, the
council may adopt a resolution approving the annexation without such a vote. Sec. 7-2-
4314(i)(dl_ We will l v close to 300 barc ls. but we determinethe
If a majority of the real property owners in the area to be annexed disapprove the
annexation in writing, the annexation attempt would be defeated. Sec. 7-2-4314(1)(d). As
indicated above, there are a sufficient amount of recorded consents to prevent a majority of the
area to validly protest the annexation.
Our time table would begin with the passing of a resolution of intent on September 5 and
forwarding the application to FRDO by September 11. We could then publish notice on
September 13 and 20, with a deadline of October 3 for comments (the publication would be in
addition to notice by FRDO). The matter would then be before the planning board for the
meeting on October 10. The Council could address the annexation and initial zoning with a first
reading on October 16 (usually FRDO would wait until November, but this schedule would allow
us to comply with the letter of the law), with the second reading on November 6. With a 30-day
effective date of December 6, the annexation with the initial zoning could be complete by the end
of the year. The time table should be confirmed with Narda.
Annexation with Provision of Services
Annexation with the provision of services is covered in Title 7, ch. 2, part 47. It allows
the annexation of contiguous land. Sec. 7-2-4705. The first step, as with contiguous land, is a
resolution of intent by the council, with a public hearing set 30-60 days away. Sec. 7-2-4707.
There is a 45 day period after the public hearing during which property owners have the
opportunity to protest. Sec. 7-2-4710. As mentioned above, there are enough consents to
prevent a defeat of the annexation by protest. The statutes are a little unclear at this point, stating
that the council can pass an ordinance of annexation 7-60 days following the public hearing. Sec.
7-2-4711. The language appears to allow the passage of the ordinance well before the end of the
protest period, which seems counter -intuitive to me. Perhaps it can be explained by the fact that
the ordinance can set an effective date at any time within 12 months from the date of the passage
of the ordinance, Sec. 7-2-4712 and 4713, which would allow the council to pass an ordinance
with a later effective date to encompass the protest period.
This method also entails a number of provisions which do not appear in other methods.
For example, no part of the area to be annexed can be within the boundaries of any fire district
under certain circumstances. Sec. 7-2-4734(4). There are also several specific provisions for
judicial review.
The time table would begin with a resolution of intent on September 5. The planning
board could look at it on October 10, which may also satisfy the public hearing requirement. We
could also certainly have a public hearing at the council level at some time as well. There would
be a 45 day protest period after the hearing, which would place us at November 24. The key for
the time table would be when the ordinance of annexation could be passed. If we are comfortable
doing so shortly after the public hearing, we could do two readings by November 6 or 20. In that
event, we could have a 30-day effective date before the end of the year. If we wait until after the
24', the second reading would not take place until December 18. The City Code states that all
ordinances shall have a 30-day effective date, so we could not have an annexation with initial
zoning completed until January 17.
EXTENSION OF SERVICES PLAN
Under either available method, we will need to have an extension of services plan prepared
under Sec. 7-2-4305 and Sec. 7-2-4732. The recent Whitefish decision does not address the
aspect of that case relating to their plan (it only covered Count I of the Complaint), so it does not
give us any guidance on this aspect. I do believe that it is important for us to be as comprehensive
and detailed as we reasonably can be in order to head off a challenge based on an insufficient plan.
SEWER AGREEMENT
In 1982, an agreement between the City and the North Village Sewer District (later
referred to as the Village County Sewer District) was executed to address a sewage collection
system in an area to the north of town. The agreement was supplemented in 1992. The
supplemental agreement does not directly affect annexation issues. I would, however, direct your
attention to paragraphs 9, 11, 17 and 18 of the initial agreement.
Paragraph 9 deals with a number of ramifications of annexation. Paragraph 17 is a waiver
of the right to protest S.I.D.s. Paragraph 18 requires individual owners to waive the right to
protest annexation if they hook-up to the sewer system or "contribute to the flow"(virtually
nobody actually did so, which might be an opening to play hardball with the continuation of sewer
services if such a tact becomes necessary).
Paragraph 11 contains the clause against annexation until "development within the portion
to be annexed reaches 80% of the approved plan development of the area to be annexed." The
application of paragraph 11 will ahnost certainly be a topic of discussion, and its interpretation
will be critical to the annexation effort. The key issue is 80% of what exactly? Are we talking
about physical square footage, number of lots, or something else? It is also important to note that
the 80% limitation only applies to annexations attempted under Section 7-2-4312 (contiguous
land).
In my discussions with Glen, he has indicated that prior annexations subject to the
agreement viewed final plat as the event to be deemed "development." Under that approach, if an
area has gone to final plat, it can be annexed. This method is by far the simplest, and would open
the door to the annexation of at least all of the platted phases of Village Greens. There would still
be a question of how to treat the golf course, since there has not been a subdivision affecting the
majority of it.
Another approach deals with a percentage of the actual physical area. We could interpret
it to mean that 80% of the square footage of the area to be annexed needs to be developed (or
substantially developed) to its intended use. In this scenario, finished roads and the golf course
would be included, because they have been developed to their intended use. Parks would also be
considered developed for the same reason. We should be well in excess of the 80% number under
this interpretation unless we were to include large areas not yet developed as part of the golf
course or for home construction.
A third approach looks at a percentage of lots which have been developed. Only about
196 of the 276 residential lots have been built upon (this ratio does not include the golf course,
parks, or adjacent property). The percentage is only 71 %. If this standard is applied, our present
effort would need to be scaled back or gerrymandered, and it could delay annexation of the whole
area for years.
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