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03. Resolution 4945 - Airport Infrastructure FundingREPORT TO: City of Kalispell Post office Box 1997 - K,%hspell, Montana 59963- z997 - Telephone 406)758-7700 Fax(406)758-7758 The Honorable Mayor Pamela B. Kennedy and City Council James Patrick, City Manager, City Manager FROM: Susan Moyer, Community Development Director Frank Garner, Interim City Manager SUBJECT: Update on City Airport Utility Needs MEETING DATE: November 1, 2004 BACKGROUND: For Mr. Patrick's information, staff is again calling attention to the fact that the City Council adopted Ordinance No. 1242 on July 17, 1997, approving the Kalispell City Airport/Athletic Complex Redevelopment Plan as an Urban Renewal Plan. Goals established by this Plan are as follows: ➢ To minimize hazards to navigation; ➢ To develop the airport in accordance to any airport layout plan; To increase development opportunities on nearby properties; ➢ To promote compatible land use in and around the airport; To establish a funding mechanism for airport operations; and To establish a priority schedule for plan implementation Regardless of whether or not the airport is upgraded to a Class B-11 designation, the need for infrastructure work such as running utilities, asphalt paving of runway and taxi areas, deferred maintenance, etc. continues to exist as long as the City owns and operates the airport. The key issue here is that the City of Kalispell is the property owner and, as such, the developer. Since the advent of City Airport Manager, the City has one new hanger valued at $125,000 under construction and T&L Properties ready to sign leases on four additional hangers at an estimated $750,000 value. These leases equate to an estimated $22,000+ in new property taxes and $15,000 in annual lease payments. 1t is the responsibility of the Developer (the City) to provide these leased sites with utilities and amenities that it takes for the hanger owners to operate. Phil Porrini of Robert Peccia & Associates has provided the City Airport Manager with a revised estimate of the "non-refundable" utilities work that needs to be installed in order for the new hanger leases to be signed and construction to take place. The estimate is $9,050 higher than submitted on August 25, 2004 due to the location of the four new T&L Properties' hangers. The underground utility costs are now estimated at $145,140. Mr. Porrini concurs with the local utility companies that it is much more cost effective to lay the utilities at one time rather than piece meal. Mr. Gary Nyquist of Flathead Electric Coop has stated that FEC would take at least a year to start the project if the City does not do a single construction project. This, most certainly, would result in the loss of the T & L Properties' hangers as well as any new inquiries. RECOMMENDATION: Tax Increment funds be utilized to pay for the non -reimbursable items such as utilities, an internal road to access hanger sites, and an electronic gate. The projected breakdown is as follows for the non -reimbursable items: Underground Utilities $118,090 Engineering & Local Utility Fees $ 32,550 Chain Link Fence, Automatic Vehicle Gate, Access Road $ 77,208 $227, 848 New TlFproperty taxes and lease revenues generated from the Carter and T&L Properties projects alone will pay for non-refundable investment in 6.2 years. If the remaining S to 7 potential hanger leases and new tax base come on line within the next year, the pay off period could be lowered to approximately 3.1 years. The attached email and drawing indicate the stub outs costs that will be installed at the time of utility construction. Stub out from the main service line were not included in the previous handout. The attached non -eligible costs have increased from the presentation last Monday, October 251h, due to including sewer stub outs from the main to the hookup sites. The hookup fees and installation will be paid for by the hanger owners. FISCAL IMPACT: Not only can the advance of Tax Increment Fax Funds be repaid to the City within 5.6 years or possibly as few as 2.8 years, the use of the "Land Sale Funds" non eligible reimbursable finds will be returned 95% by FAA. This means invested wisely, the reimbursable $950,000 of land sale funds can make the operation and maintenance of the revamped airport viable and self-sufficient long into the future. ALTERNATIVES: As suggested by Council. Respectfully submitted, Susan Moyer, Director, Fran Garner, Community Development Interim City Manager Memo Prepared: October 27, 2004 RESOLUTION NO.4945 A RESOLUTION TO APPROVE THE EXPENDITURE OF FUNDS FOR THE INSTALLATION OF CERTAIN INFRASTRUCTURE AT THE KALISPELL CITY AIRPORT. WHEREAS, on July 17, 1997 the City Council, by Ordinance 1242, approved the Kalispell City Airport/Athletic Complex .Redevelopment Plan as an Urban Renewal Plan; and WHEREAS, certain goals identified in the plan included the development of the airport in accordance to an airport layout plan; and WHEREAS, the installation of certain infrastructure at the airport, such as the installation of utilities and asphalt paving, has been identified as necessary regardless of whether the airport will ultimately be upgraded to a Class B-11 designation; and WHEREAS, the installation of certain infrastructure is necessary to the development of the airport that will attract private investment in the airport property; and WHEREAS, funds derived from the sale of airport properties are better used to purchase other needed airport properties as these funds may be at least partially reimbursed to the City of Kalispell through FAA programs; and WHEREAS, it is appropriate to use tax increment funds from the Airport Tax Increment District for the funding source of installation of infrastructure. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF KALISPELL AS FOLLOWS: SECTION I. That the City is authorized to expend funds from the Airport Tax Increment Financing Fund for the payment to install certain infrastructure at the Kalispell City Airport, described as underground utilities, engineering and local utility fees, chain link fencing, automatic vehicle gate and access road, with the anticipated cost of approximately $230,000. SECTION II. This resolution will become effective upon passage and approval by City Council. PASSED AND APPROVED BY THE CITY COUNCIL AND SIGNED BY THE MAYOR OF THE CITY OF KALISPELL, THIS 1 s" DAY OF NOVEMBER, 2004. Pamela B. Kennedy Mayor ATTEST: Theresa White City Clerk 1. } A q _ s ac a } z r E r E r i E v, --- t� ------j ■ F— __ w___T __ F ii r I ins P%:=__:•�-_---___-_-'1 g Cn D ------------------------- ------------------ A. � r � Q rt q AE - O P f.,�•^-cam -"w rS f S �a j y Si ... TITLE PR ECT TrT! E C KALISPELL CITY AIRPORT 0:16AIRPORT LAYOUT IMPROVEMENTS PLAN NORTH END UTILITIES {Q�a.�Z A ��jOp�npro N{ Y S n A ly /ry M Ig b0� m tlY" M z m jai .x a--����� TI�� ii 3 . vam2 a1- n02 i�t ""mmhy C yy=� w�mr� o� mr m a Npp s'i"' lei _ N o Ir^ a.-_ Rios yRQ�r i M 2F R 2-7 M $ 1 r. 8 RE' Wpm ti3 OC9-29. 2W4 N SAW o�z,on 9 E7 NALDSCN Sry NC — Kalispell City Airport - Northend Development Tax Increment Financing Project #I Revised: 10/27/2004 PPP Non -eligible Work Items: Underground Utilities each (ea) linear feet (10 area (sf) area (sy) quantity unit cost units Total 8" Water Main, met valves and fittings 818 818 $35.00 LF $28,630.00 8" Water Service, met valves and fittings 129 128 S35.00 LF $4,480.00 1" Copper Water Service Lines, met saddles, curb valves and end posts 136 136 S20.00 LF $2,720.00 6" Sewer Service Lines (individually installed) 10 20 10 $500.00 EA $5,000.00 Fire Hydrants, incl valves and fittings 2 2 $3,000.00 EA $6,000.00 Common Utility Trench, met excavation, bedding, backfill, asphalt R&R 1,400 1,400 $10.00 LF $14,000.00 Electric Backbone, 3" PVC, Sch 40 1,400 1,400 S4.00 LF $5,600.00 Electric Vaults 4' x 4' x 4' 4 4 $750.00 EA $3,000.00 Electric Steel Sweeps 10 10 $100.00 EA S 1,000.00 Gas Backbone, met gasline, valves and end caps 1,000 1,000 $9.00 LF S8,000.00 Air port Road Boring for gas only I 1 S1,000.00 EA $1,000.00 Telephone Backbone, incl conduits, cables and pedestals 1,000 1,000 $6.00 LF $6,000.00 Airport Road Boring for telephone only I t $1,000.00 EA SLo00.00 Cable TV Backbone, 2" PVC Sch 40, me] sweeps & peds 1,000 1,000 $3.00 LF S3,00o.00 Airport Road Boring for cable TV only I I $1,000.00 EA $1,000.00 Subtotal Utility Package $90,430.00 Advertising / Admin Design Engineering - Non -Eligible: (Task Order 45) Flathead Electric Coop, electrical charges Northwestern Energy, natural gas charges (estimated) waiting for actual cost Century Tel, telephone charges (estimated) waiting for actual cost Bresnan Communications, CTV charges (estimated) waiting for actual cost Subtotal Administration and Engineering Chain Link Fence Alteration Automatic Vehicle Gate 16wide - Chain Link Vehicle Access Road 16' Asphalt Width Subtotal Other Construction $2,000. W S7,050.00 S6,957.00 S2,000.00 S7,000.00 $1,000.00 $26,007.00 24 24 S17.00 LF S408M 16 16 $1,000.00 LF $16,000.00 1,181 18,896 2,100 2,100 $24.00 SY S50,384.33 $66,79733 TOTAL COSTS - NON -ELIGIBLE ITEMS $183,234.33 Including the Proposed Development by ]'HE Properties Non -eligible Work Items: Underground Utilities each (ea) linear feet(1fi area (so area (s) quantity unit cost units Total 8" Water Main, me] valves and fittings 1,160 1,160 $35.00 LF $40,600.00 8" Water Service, inel valves and fittings 128 128 $35.00 LF $4,480.00 1" Copper Water Service Lines, incl saddles, curb valves and end posts 181 181 $20.00 LF $3,620.00 6" Sewer Service Lines (individually installed) 11 20 2! $500.0-0 EA S5,59.0.00 Fire Hydrants, incl valves and fittings 3 3 $3,000.00 EA $9,000.00 Common Utility Trench, met excavation, bedding, backfill, asphalt R&R 1,740 1,740 S I0.00 LF $17,400.00 Electric Backbone, 3" PVC, Sch 40 1,740 1,740 $4.00 LF $6,960,00 Electric Vaults 4' x 4' x 4' 5 5 $750.00 EA $3,750.00 Electric Steel Sweeps io 10 $100.00 EA $1,000.00 Gas Backbone, incl gasline, valves and end caps 1,340 1,340 $8.00 LF $10,720.00 Airport Road Boring for gas only I I $1,000.00 EA $1,000.00 Telephone Backbone, me] conduits, cables and pedestals 1,340 1,340 $6.00 LF $8,040.00 Airport Road Boring for telephone only 1 I $1,000.00 EA S1,000.00 Cable TV Backbone, 2" PVC Sch 40, me] sweeps & peds 1,340 1,340 S3.00 LF $4,020M Airport Road Boring for cable TV only ] 1 $1,000.00 EA $1,000.00 Subtotal Utility Package $118,090.00 Advertising / Admin Design Engineering -Non-Eligible: (Task Order 115) Design Engineering - Non -Eligible: (Task Order ft5A) - Additional Services Flathead Electric Coop Charges (Prorated Estimate) Northwestern Energy Natural Gas Charges (estimated) waiting for actual cost Century Tel, telephone charges (estimated) waiting for actual cost Bresnan Communications, CTV charges (estimated) waiting for actual cost Subtotal Administration and Engineering Chain Link Fence Alteration Automatic Vehicle Gate IG wide - Chain Link Vehicle Access Road 16' Asphalt Width Subtotal Other Construction $2,000.00 $7,050.00 $2,250.00 $8,750.00 $2,500.00 $8,750.00 $1,250.00 $32,550.00 24 24 $17.00 LF S408.00 16 16 SLOoo.00 LF $16,000.00 1,425 22,800 2,533 2,533 $24.00 SY $60,800,00 $77.?.O8.00 TOTAL COSTS - NON -ELIGIBLE ITEMS $227,848.00 CCE.sh; revised non -el & THL proposal 10/27/2004 1 "r 1