2. Ordinance 1558 - Technology Tax Increment District - Old School Station - 2nd ReadingCity of Kalispell
Charles A. Harrah Offlice of City Attorney rTel 406.759.7708
City Attorney 312 First Avenue East Fax 406.758.7771
0. Box 1997 charball Ccukabspell,com
Kalispell, MT 99 -199'
MEMORANDUM
TO: Mayor Pamela B. Kennedy
and. Kalispell City Council.
FROM Charles Ha.rball, City Attorney
James H. Patrick, City Manager
SUBJECT: Ordinance No. 1558 Technology Tax Increment District
for old school Station — Second Reading
MEETING DATE: Monday, November 21, 2005 Regular Meeting
BACKGROUND: Council issued its Resolution of Intent to create a Technology
Tax Increment District for old school Station and a public hearing was conducted
on November 7, 2005. ordinance No. 1558 was considered by Council and passed
on first reading that same meeting. 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 unimproved
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 withIn the Technology Tax Increment district that does not meet the
statutory criteria of "tech oloe' will also pay the base rate, as well as increment
(tax on the increased value), to the various local taxing entitles. 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 hose lots(assessments).
RECOMMENDATION: That Council consider and pass Ordinance No. 1558 on
second reading, establishing a Technology 'fax Increment District within Ol.d school
Station.
FISCAL EFFECTS: It is anticipated that the cost benefit should favor the City.
Respectfully!b itted, w .
w
Charl.e ` a all, City Attorney ja4lies H. a-f-i", City Manager
ORDINANCE 1558
AN ORDINANCE ESTABLISHING .A. TECHNOLOGY TAX INCREMENT DISTRICT
To ASSIST IN FINANCING NECESSARY INFRASTRUCTURE To ENCOURAGE
THE LOCATION AND RETENTION OF TECHNOLOGY DEVELOPMENT
PROJECTS IN THE STATE of MONTANA AND THE CFrY of KA IS E L,
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; CREA.T NG AND APPROVING
THE OLD SCHOOL STATION TECHNOLOGY TAX INCREMENT DISTRICT of
HE CITY of KALISPELL, MONTANA; AND ESTABLISHING THE BOUNDARIES
OF THE OLD SCHOOL STATION TECHNOLOGY TAX INCREMENT DISTRICT*
ESTABLISHING JANUARY 1, 2005 AS THE BASE TAXABLE YEAR FOR THE OLD
SCHOOL STATION TECHNOLOGY TAX INCREMENT DISTRICT.
WHEREAS, the City of Kalispell, Montana(the "City"') is defined as a "municipality"
..der Montana Code annotated, Section 7-15-4283, as amended, for the purpose of creating a
Technology District pursuant to Montana Code Annotated, Section 7-15- 29 , as amended, and
being; operated by the City pursuant to Montana Code Annotated, Sections 7--22 through 7-
15-4293 and Montana Code Annotated, Title 7, Part 15, Chapter 3; and
WHEREAS, pursuant to Montana Code Annotated, Sections 7-15-42 2 through 7-15-
299, as amended (the "Act"), including Montana Code Annotated, Section 7-15-4295, as
amended, the City Council (the "City Council") of the City may create a Technology Tax
Increment District as defined below) 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 technology-
used 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 pubhc hearing required
y the Act and receipt of public input, found that there is a need for this ordinance to create the
Old School 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 P of THE CITY of
KALISPELL, MONTANA7 AS FOLLOWS:
Section 1. Definitions. ID this ordinance the following terms have the meanings
indicated below.
(a) "Act" means Montana Code .Annotated, Section 7-15- 2 2 through 7-15-
2 9, as amended*
(b) "Actual Taxable Value" means the taxable value of taxable property at
any time, 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 al area., Technology y 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 --1 - 2 7 or 7-1 - 2 3 of the Act. "Technology District"' means a Technology
Tax Increment District created pursuant to Section 7-15-4299 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.
(f) "Infrastructure" means the acquisition, construction, and improvement o
streets., roads, curbs, gutters, sidewalks, pedestrian malls, alleys, parking lots and
offstreet parking facilities, severs, 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 r parts 41 through 45 of Chapter 12, ii parts
2 and 43 of Chapter 1.3, and iii past 47 of Chapter 14 of the Montana Code Annotated,
and items of personal property to be used in connection with improvements for which
the foregoing costs may be incurred.
(g) "Tax Increment's means the collections realized from extending the tax
levies, expressed in mills, of all taxing bodies which the Technology Tax Increment
District or a part thereof is located, against the Incremental Taxable Value.
(h) "Taxes' means all taxes levied by a taxing body against property on an ad
valorem basis.
(i) "'Teehno o y District"' means a tax increment financing Technology
District such as the Technology Tax Increment District, crated pursuant to Section 7- 5
25 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. Pulpose. The purpose of this ordinance is to i create a Technology 'fax
Increment District to be known as the old School Station Technology Tax Increment District of
the City of Kalispell, Montana, ii to encourage the location and retention of technology
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development projects in the State of Montana 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 Montana and the City.
Section 3. FindipgsDeterminations and Declarations. Based on 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 in (a) through i below.
The City Council of the City of Kalispell, Montana hereby finds, determines, and
declares that:
(a) the Technology Tax Increment Distract 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 rin company with at least fifty percent (50%) 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 in the Mate of
Montana and the City;
(c) the passage of this Ordinance and the establishment of the "technology
Tax Increment District fall within the econornic goals adopted by the City Council and
the adoption therefor is in the public interest;
(d) the Technology 'fax Increment District, as proposed, consists of a
continuous area with an accurately described boundary that is large enough to host a
diversified tenant base of multiple independent tenants;
(e) the Technology Tax Increment District is zoned in accordance with the
area growth policy, as defined in Montana Code Annotated, Section T -- 03;
(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 host a diversified
tenant base of multiple independent tenants; and
(i) the Technology Tax Increment District is not designed to serve the needs
of a single district tenant or group of nonindependent tenants.
Section 4. Costs which mav be aid by the City from Tax Increments. The Tax
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 below.
The costs that may e paid with Tax Increments are:
(1) land acquisition;
(2) demolition and removal of structures;
(3) relocation of occupants;
(4) Infrastructure-,
(5) to prepare are 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 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 information required to adequately
determine the infrastructure needs of secondary, value -adding industries 'in the
Technology Tax Increment District;
(12) the connection of the Technology Tax Increment 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 land needs within the Technology Tax Increment
District;
(14) the Tax Increments received may be pledged, pursuant to Section 7-15-4290 o
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 7-15-4288 of the Act, including 1)
the items listed in 1 through 13 above or ii any other costs otherwise
authorized to be paid under the terms of the Act.
Section 4. Boundaries. The boundaries of the Technology Tax Increment District are
(i) described in Exhibit .A attached hereto and made a part hereof, and h) are shown on the reap
attached hereto as Exhibit B.
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Section 5. Base Year. For the purpose of calculating the Incremental Taxable Value
each year for the life of the Technology Tax Increment t District, the Base 'taxable Value shall be
calculated as the taxable value of all property within the Technology Tax Increment District as of
January 1, 2005.
Section 6. Term of the Technology TaxIncrement District. The Technology Tax
Increment e .t District will terminate -upon the later f:
(a) the fifteenth 51
year following the creation of the Technology Tax
Increment District; or
(b) the payment or provision for payment in full or discharge of all bonds
(including special assessment bonds) for which 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 into the funds of the taxing bodies levying taxes wits. the Technology Tax
Increment .district.
Section 7. Effective Date, This Ordinance shall be in full force and effect thirty (30)
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 Y THE CITY COUNCIL AND SIGNED BY THE MAYOR OF
HE CITY OF KAISPELL THIS 21ST DAY OF NOVEMBER, 2005.
ATTEST:
Theresa White
City Clerk
Pamela B. Kennedy
Mayor
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EXHIBIT A
SHORT DESCRIPTION of THE PROPOSED TECHNOLOGY TAX INCREMENT
DISTRICT
The proposed old School Station Technology Tax Increment District of the City o
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 o
Certificate of Survey No. 16337 in the SW 1 of Section 33, Township 28 North, Range 2
West, P.1 .M., Flathead County, Montana. The portion of the property erty dedicated to the
technology tax increment ent district is proposed to be Lots 2, 37 4, 5, 6, 7, 8, 9, and 10 as shown i
the drawing entitled 4101d School Station" and attached hereto and incorporated orated Fully herein by
this reference. These nine lots comprise a total of approximately 27,77 ages.
(The remainder of this page is intentionally left blank.)
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EXHIBIT
MAP OF THE PROPOSED INDUSTRIAL TAX INCREMENT DISTRICT
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