2. Ordinance 1587 - Establishing Impact Fees - 2nd ReadingCity of Kalispell
Charles A. Harball Office of City Attorney
City Attorney 312 First Avenue East
P.O. Box 1997
Kalispell, MT 59903-1997
MEMORANDUM
TO: Mayor Pamela B. Kennedy
and Kalispell City Council
FROM: Charles Harball, City Attorney
James H. Patrick, City Manager
Tel 406.758.7708
Fax 406.758.7771
charball@kalispell.com
SUBJECT: ordinance No. 1587 — Establishment of Impact Fees
MEETING DATE: Monday, October 16, 2006 — Regular Council Meeting
BACKGROUND: Montana state legislation regulating impact fees to fund capital
improvements, MCA 7-6-1601 through 7-6-I604, became effective April 19, 2005
and set forth the procedures and requirements for the imposition of impact fees by
local governments. City Council has, pursuant to statute, established and
appointed an Impact Fee Advisory Committee, which has been meeting in noticed
public meetings with the City's consultant, HDRIEES. On September 5, 2006 City
Council set a public hearing held on October 2, 2006 on said proposed amendments
to the fees, schedules, charges and classifications of these utility services of the City
of Kalispell and the City Clerk gave the necessary Notice thereof as required by
Section 69- 7-111, MCA.
RECOMMENDATION: MENDATION: Following the public hearing, Council considered
Ordinance 1587 that establishes and authorizes the procedure for the
implementation of impact fees pursuant to the requirements of state law. Council
should pass ordinance 1587 on second reading.
FISCAL EFFECTS: The fiscal effects of adopting impact fees to fund capital
improvements is significant to the City's ability to plan for meeting the demands of
growth on the City's infrastructure.
Respectfully submitted,
Char arb ll, City Attorney J e s H. Patrick, City Manager
ORDINANCE NO. 1587
AN ORDINANCE AUTHORIZING AND ESTABLISHING THE PROCEDURE AND
IMPOSITION OF IMPACT FEES TO FUND CAPITAL IMPROVEMENTS IN THE CITY
OF KALISPELL, A[JTHORIZING THE CITY ATTORNEY TO CODIFY SAME AND
DECLARING AN EFFECTIVE DATE,
WHEREAS, Montana State legislation regulating impact fees to fund capital improvements, FICA
7-6-1601 through 7-6-1604, became effective April 19, 2005 and sets forth the
procedures and requirements for the imposition of impact fees by local governments;
and
WHEREAS, an impact fee represents a fee for service payable by all users creating additional
demand on a city facility; and
WHEREAS, it is the finding of the City Council that it is in the best interests of the City of
Kalispell that certain impact fees be considered and imposed to fund capital
improvements and that a procedure be established for this purpose that is compliant
with state law.
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF KALISPELL, MONTANA, AS
FOLLOWS:
SECTION I Establishment of a Standin Irn act Fee Committee. The City shall maintain a
standing impact fee advisory committee. This impact fee advisory committee shall include at
least one representative of the development community and one certified public accountant.
The committee shall review and monitor the process of calculating, assessing, and spending
impact fees. The committee shall be provided with adequate financial reports on a semiannual
basis, shall meet at least annually, and shall provide the City Council with a report of their
findings and recommendations. The City shall provide the committee with the appropriate
advice and counsel of professional City Staff and/or an appropriate professional consultant
selected by the City. The City Council shall not consider or adopt any impact fees that have not
been first considered by the committee. The Impact Fee Committee shall serve in an advisory
capacity to the City Council.
SECTION II Calculation and Im osition of Im act Fees. Any impact fees to fund capital
improvements of the City of Kalispell shall not be approved and adopted by City Council
unless those fees have been calculated in accordance with 7-6-1602 MCA or as such statute
may later be amended. Impact fees may not be imposed for remodeling, rehabilitation, or
other improvements to an existing structure, or rebuilding a damaged structure, unless there is
an increase in units that increase service demand as set forth by state law. If impact fees are
imposed for remodeling, rehabilitation, or other improvements to an existing structure or use,
only the net increase between the old and new demand may be imposed. The data sources and
methodology supporting adoption and calculation of an impact fee shall be available to the
public upon request.
SECTION III Collection of Impact Fees. (a) Upon collection, all impact fees shall be
deposited in a special proprietary fund, which. shall be invested with all interest accruing to the
fund.
(b) The City may impose impact fees on behalf of local districts.
(c) If the impact fees are not hereafter collected or spent in accordance with this ordinance or
are not in compliance with 7-6-1602 MCA, any impact fees that were collected must be
refunded to the person who owned the property at the time that the refund was due.
(d) The Kalispell Building Department shall collect all impact fees imposed and shall collect
them no earlier than the date of issuance of a building permit if a building permit is required for
the development or no earlier than the time of wastewater or water service connection or well
or septic permitting.
SECTION IV. Contributions in Lieu of Impact Fee Payments. The City may accept the
dedication of land or the construction of public facilities in lieu of payment of impact fees if:
(a) the need for the dedication or construction is clearly documented pursuant to 7M6-
1602 MCA; and
(b) the land proposed for dedication for the public facilities to be constructed is
determined to be appropriate for the proposed use by the City of Kalispell; and
(c) the value of the proposed dedication or construction has been established by an
independent appraiser or construction engineer, which appraisal or estimate has been subject to
peer review; and
(d) in the event the value of the proposed dedication or construction exceeds the
impact fee due from an individual development no credits against future impact fee obligation
shall be established. In that event, the City shall pay the excess worth to the contributor.
SECTION V. A ppeal Process. Any party upon whom an impact fee has been imposed has the
right to appeal the imposition or amount of the impact fee. The Appellant must perfect the
appeal by giving written notice of the appeal to the Building Department along with the full
amount of the required impact fee, in cash or cash equivalent as an appeal bond. The form of
the written notice shall be sufficient if it identifies the name and address of the appellant and a
short statement giving the reason why the impact fee is wrongly imposed or in the wrong
amount. Upon receiving the Notice of Appeal and cash bond, the building department official
shall, within 24 hours, notify the City Manager who will place the matter before the City
Council on its next regularly scheduled City Council Meeting that is more than S days
following the filing of the appeal. The City Council shall hear evidence from the Appellant and
City staff and shall make the determination whether the impact fee imposed upon the Appellant
is compliant with state law and city ordinance. In the event that the City Council determines
that the imposition of the impact fee is not compliant with either state law or the city ordinance,
the City shall return the cash bond paid by the appellant.
SECTION VI. This Ordinance shall be effective thirty (30) days from and after the date of
its final passage and approval.
PASSED AND APPROVED BY THE CITY COUNCIL AND SIGNED BY THE MAYOR THIS
16TH DAY OF OCTOBER, 2006.
Pamela B. Kennedy
Mayor
ATTEST:
Theresa White
City Clerk.