07. Ordinance 1558 - Technology Tax Increment District - Old School Station - 1st ReadingCity of Kalispell
Charles A. Harball office of City ,Attorney Tel 406.758.7708
City Attomey 312 First Avenue East Fax 406.758,7771
P.O. Box 17 rall@liell.co
Kalispell., MT 59903-1997
MEMORANDUM
TO* Mayor Pamela B. Kennedy
and Kalispell. City Council
FROM: Charles Har al , City Attorney
Janes H. Patrick, City Manager
SUBJECT: Ordinance No. 1558 Technology Tax Increment District
for Old School Station --w First Reading
MEETING ATE: Monday, November 7, 200 — Regular Meeting
BACKGROUND: Council previously gave its Resolution of Intent to create a
Technology Tax Increment District for old School Station and a public .e rin.g
being conducted this sane evening. Discussion was held by Council and staff at a
public work session on November 1, 20. The primary purpose of creating the
Technology Tax Increment District is to create additional incentive for new
technology businesses to locate within. the City of Kalispell rather than. elsewhere.
The current tax base of old School Station is primarily u n. roved
agricultural land. Taxes collected on this base will continue to be distributed
between the local taxing entities, such as the county and schools. Any business that
locates wltbln the Industrial Tax Increment district that does .not meet the
statutory criteria o "technology" will also pay the base rate, as well as increment
(tax on the increased value), to the various local taxing entities. The tax increment
on those improved lots that do meet the statutory criteria of technology may be used
to pay for the costs of public infrastructure that apply to those lot (assessments).
RECOMMENDATION: That Council consider and pass ordinance No. 1557,
approving the establishment of a Technology 'fax Increment District within old
School Station.
FISCAL EFFECTS: It is anticipated that the cost/benefit should favor the City.
Respectfully.7litt A
Charles r al -"'C ty Attorney �e H. Patrick., pity Manager
..a
ORDINANCE 1558
AN ORDINANCE CE ESTABLISHING .A TECHNOLOGY TAX INCREMENT DISTRICT"
O ASSIST IN FINANCING NECESSARY INFRASTRUCTURE TO ENCOURAGE
HE LOCATION AND RETENTION of TECHNOLOGY DEVELOPMENT
PROJECTS IN THE STATE of MONTANA AND THE CITY of KALISPELL,
MONTANA; PROVIDING FOR DEFINITION of TERMS; ESTABLISHING THE
COSTS WHICH MAY BE PAID BY THE TECHNOLOGY TAX INCREMENT
DISTRICT TO BE CREATED BY THIS ORDINANCE; CRA I G AND APPROVING
THE OLD SCHOOL STATION TECHNOLOGY TAX INCREMENT DISTRICT of
HE CITY of KA ISI'E.I..tL, MONTANA; AND ESTABLISHING THEBOUNDARIES
OF THE OLD SCHOOL STATION TECHNOLOGY TAX INCREMENT DISTRICT;
ESTABLISHING , ANUARY I, 2005 AS THE BASE TAXABLE E YEAR FOR THE ODD
SCHOOL STATION TECHNOLOGY TAX INCREMENT DISTRICT,
WHEREAS, the City of Kalispell, Montana (the "City"') is defined as a "municipality"'
under Montana Code Annotated, Section 7-1-5-4283, as amended, for the purpose of creating
Technology District pursuant to Montana Code Annotated, Section 7-1.5 -4295, as amended, and
being operated by the City pursuant to Montana Code Annotated, Sections 7-15-4282 through 7-
15-4293 and Montana Code Annotated, 'title 7, Fart 15,, Chapter 43; and
WHEREAS, .pursuant to Montana Code Annotated, Sections 7-15-4282 through 7-
4299, as amended (the "Act"), including Montana Code Annotated, Section 7- .5-429 , as
amended, the City Council (the "City Council") of the City may create a Technology Tax
Increment District as definedbelow) for the purpose of encouraging the attraction and retention
of secondary, value -adding industries to the City; and
WHEREAS, the City Council Wishes to encourage the location and .retention o
technology development projects in the State of Montana and the City, and
WHEREAS, the development of businesses or organizations engaged in te ology-
a.sed operations requires expensive infrastructure improvements which are beyond the available
resources of the City to provide; and
WHEREAS., the City Council of the City has determined, after a public hearing required
y the .Act and receipt of public input, found that there is a need for this ordinance to create the
Old Stool Station Technology Tax Increment District of the City of Kalispell, Montana and the
City Council wishes to enact this ordinance.
NOW THEREFORE., BE IT ORDAINED BY THE CITY COUNCIL of THE CITY of
KALISPELL, MONTANA, .AS FOLLOWS. -
Section 1. Definitions. n this ordinance the following terns have the meanings
indicated below.
(a) "Act"' means Montana Code Annotated, Section 7 - -22 through. 7 - 1
4299, as amended.
(b) �"Actual Taxable value" means -the taxable value of taxable property at
any ftme, as calculated from the assessment roll last equalized.
(C) "Base Taxable value" means the actual taxable value of all taxable
property within an urban renewal area, Technology District, Technology District, or
aerospace transportation and technology district prior to the effective date of a tax
increment financing provision. Base 'taxable Value may be adjusted as provided in
Section -15. 2 r --2 3 of the Act. t. "'Technology District"' means a Technology
Tax Increment District created pursuant to Section -1 -4299 of the Act,
(d) :'Incremental Taxable value" means the amount, if any, by which the
Actual Taxable value at any time exceeds the Base Taxable Value of all property within
the Technology Tax Increment District.
e "Industrial Infrastructure Development Project" means a project
undertaken within or for a Technology District that consists of any or all of the activities
authorized by Section 7-15-4288 of the Act.
"Infrastructure" means the acquisition.,, construction, and improvement o
streets, roads, curbs, gutters, sidewalks, s, pedestrian malls, alleys, parking lots and
ofstreet parkin; facilities, sewers, sewer lines, sewage treatment facilities, storm
sewers, waterlines, waterways, water treatment facilities, natural gas lines, electrical
lines, telecommunication lines, rail lines, rail spurs, bridges, publicly owned buildings,
any public improvements authorized by i parts 41 through 45 of Chapter 12, (10 parts
42 and 43 of Chapter 13, and iii part 47 of Chapter 14 of the Montana Code Annotated,
and items of personal property to be used in connection with improvements ents for which
the foregoing casts may be incurred.
(g) `*Tax Increment" means the collections realized from extending the tax
levies, expressed in mills, of all taxing bodies which the Technology Tax Increment
District or a hart thereof is located, against the Incremental Taxable value.
(h) "`axes" means all taxes levied by a taxing body against property on an ad
valorem basis.
i "Technology District" means a tax 'increment financing Technology
District such as the Technology Tax Increment District, crated pursuant to Section -- .5-
4295 of the Act.
0 "Technology Tax Increment District" means the Old School Station
Technology Tax Increment District of the City of Kalispell, Montana designated as such
by the City Council in accordance with the provisions of the Act and this Ordinance.
Section 2. Purpose, The purpose of this ordinance is to i create a Technology Tax
Increment District to be known as the old School Station Technology Tax Increment District of
the City of Kalispell, Montana, 10 to encourage the location and .retention of technology
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development projects in the State of Montana a and the City, and (iii) provide a financial
mechanism for the installation and construction of infrastructure improvements for the location
and retention of technology development projects in the State of Mortara and the City.
Section. 3. Fin...... ......... - --- --eterrrr nation s and Declarations. Based or representations
.... made by Montana venture Partners, LLC to City staff and the City Council. and the work of City
staff to date, the City Council, by this ordinance, makes the findings, determinations, and
declarations set forth i a through (i) below.
The City Council of the City of Kalispell, Montana hereby finds, determines., and -
declares that:
(a) the Technology Tax Increment District is intended to provide assistance to
businesses or organizations engaged in technology -based operations that through the
employment of knowledge or labor add value to a product, process, or export service that
results in the creation of new wealth and for which at least fifty percent 50 of the
sales of the business or organization occur outside of the State of Montana or the business
or organization is a manufacturing company with at least fifty percent 0% of its sales
to other Montana companies that .have fifty percent 50 of their sales occurring outside
of the Stat of Montana;
(b) this ordinance and the formation of the Technology Tax Increment
District, as proposed, will facilitate the development of the -necessary Infrastructure
encourage the location and retention of technology development projects 1 the State of
Montana and the City;
(c) the passage of this ordinance and the establishment of the Technology
Tax Increment District fall within the economic goals adopted by the City Council and
the adoption therefor is in the public interest;
(d) the Technology nology Tax Increment District, as proposed, consists of a
continuous area with an accurately described boundary that is large enough to Most a
diversified tenant base of multiple independent tenants;
(e) the Technology Tax Increment District is zoned it accordance with the
area growth policy, as defined inn Montana Code Annotated, Section 7 -1- .o ;
(f) the Technology Tax Increment District does not include any property
located within an existing; urban renewal area district or 'Industrial infrastructure
development district created pursuant to the Act;
(g) the land in the Technology Tax Increment District is currently deficient in
Infrastructure improvements for technology development;
(h) the Technology Tax Increment District is intended to lost a diversified
tenant base of multiple independent tenants; and
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(i) the Technology 'fax Increment District is not designed to serve the needs
of a single district tenant or group of noni-ndependent tenants.
Section 4. Costs 'which may be paid.....b.ythe Ot from Tax Increments. The 'fax
. Increment received by the City from the from the Technology Tax Increment District may be
used to pay any costs or obligations incurred for an Industrial Infrastructure Development Project
(ire the Technology Tax Increment District) including those listed in 1. through 14 below.
The costs that may be paid with Tax Increments are:
(1) land acquisition;
(2) demolition and removal of structures;
(3) relocation o occupants;
(4) Infrastructure;
(5) to prepare an industrial development plan;
(6) to organize, coordinate and direct the administration of this ordinance;
(7) to conduct appraisals, title searches, surveys, studies, and other preliminary plans
and work necessary to prepare for the undertaking of .infrastructure Development
.projects;
(8) acquisition of infrastructure -deficient areas or portions thereof;
(9) administrative costs associated with the management of the Technology nolo Tax
Increment District;
(10) assemblage of land for development or redevelopment by private enterprise or
public agencies, including sale, initial leasing, or retention. by the City at its fair
value;
(11)the compilation and analysis of pertinent InformatiOD required to adequately
determine the infrastructure needs of secondary, value -adding industries in the
Technology Tax Increment District;
(1.2)the connection of the Technology Tax l.ncrement ,district to existing infrastructure
outside; the Technology Tax Increment District;
(13)the provision of direct assistance to secondary, value -adding industries to assist in
meeting their .infrastructure and lard needs within the Technology Tax Increment
District;
(14)the Tax Increments xer is received may be pledged, pursuant to Section7-15-4290 of
the Act, for the payment of the principal of, premium, if any,, and interest on
revenue bonds issued for Industrial Infrastructure Development Projects, general
obligation bonds, revenue bonds, or special assessment bonds issued to pay
Technology District costs described in Section. -15-42 8 of the Act, including (i
the items listed in 1 through 13 above or Hany other casts otherwise
authorized to be paid under the terms of the Act.
Section 4. Boundaries. The boundaries of the Technology Tax Increment District are
(1) described in Exhibit A attached hereto and made a part hereof, and ii are shown on the map
attached hereto as Exhibit B.
Section 5. Base Year. For the purpose of calculating the Incremental Taxable value
each year for the life of the Technology Tax Increment District, the Base Taxable Value shall be
calculated as the taxable value of all property within the Technology 'fax Increment District as of
January 1, 2005.
Section 6. Term of the Technology Tax Increment District. The Technology Tax
Increment District will terminate upon the later of:
(a) the fifteenth 15 year following the creation of the Technology 'fax
Increment District; or
( ' b) the payment or provision for payment in full or discharge of all bonds
(including special assessment bonds) for w i b the Tax Increment has been pledged, and
the interest thereon.
After termination of the tax increment financing provision, all taxes shall be levied upon
the actual taxable value of the taxable property in the Technology Tax Increment District and
shall be paid linto the funds of the taxing; bodies levying taxes within the Technology Tax
Increment District.
Section '. Effective Date. This ordinance shall be in full force and effect thirty 0
days after its final passage and adoption by the City Council of the City.
Section 8. Conflict with other Ordinances and Resolutions. All parts of ordinances
and Resolutions in conflict with this ordinance are hereby repealed.
PASSED AND APPROVED THE CITY COUNCIL AND SIGNED BY THE MAYOR OF
HE CITY of KALISPELL THIS DAY OF
ATTEST:
------ --- --- - - - - - - - -
Theresa White
City Clerk
Pamela B. Kennedy
Mayor
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EXHIBIT A
SHOWr DESCRIPTION OF THE PROPOSED TECHNOLOGY TAX INCREMENT
DISTRICT
The proposed old School Station Technology Tax Increment District of the City of
Kalispell, Montana is located just east of Highway 93 on Demersville Road approximately 1.9
miles south of Four Corners intersection and directly east of the Rocky Cliff Road intersection
and is situated within that property that is legally described as that portion of Parcel A of
Certificate of Survey No. 16337 in the SW of Section 33, Township 28 North, Range 21
West] P.M.M., :Flathead County, Montana. The portion of the property dedicated to the
technology tax increment district is proposed to be Lots 2, 3, 4, 5, 6, 7, 8, 9, and 10 as shorn in
the drawing entitte '`Old School Station"' and. attached hereto and incorporated fully herein by
this reference. These nine lots comprise a total of approximately 27.77 acres,
(The remainder of this page is intentionally left blank.)
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EXHIBIT
MAC' OF THE PROPOSED INDUSTRIAL TAX INCREMENT DISTRICT
OLD SCHOOL STATION
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