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1. Resolution 4828 - Amending the Downtown Business Improvement DistrictCity of Kalispell Charles A. Harball Office of City Attorney City Attorney 312 First Avenue East P.O. Box 1997 Kalispell, MT 59903-1997 TO: FROM: SUBJECT: MEETING DATE: Mayor Pamela B. Kennedy and Kalispell City Council Charles Harball, City Attorney Chris Kukulski, City Manager Tel 406.758.7708 Fax 406.758.7771 charball@kalispell.com Resolution 4828 Amending the Downtown BID Monday, September 2, 2003 BACKGROUND: As Council will recall, at the July 7 Council meeting, after a public hearing, the Council passed Resolution 4797 creating a Downtown Business Improvement District. At that time those persons who had filed a written protest were allowed the time and forum to address the reasons and rationale for their protests. The Council considered that, pursuant to statute, less than 50% of the landowners and less than 50% of the taxable value represented in the BID protested the formation of the BID. Therefore Council passed the resolution creating the district. Council will also recall that one of the protestants, represented by attorney James Bartlett, expressed concern that the City had not considered the protests based upon percentage of projected assessments. At that time I explained to Council that the City had not offered, nor could it offer, any projection of assessments on the properties as no directors were yet appointed, no work plan and no budget or assessment method was in place to make any such projections. In speaking with attorney Bartlett some time after the meeting he expressed the fact that the proponents of the BID had presented the petitions to landowners with the representation of projected assessments based upon an annual budget set at $60,000 per year and the method of assessment that was a pro-rata of the total assessed valuation of the BID properties. I confirmed this fact with Bill Goodman, one of the proponents. Mr. Bartlett felt that, although this was not the City's representations, it should be taken into account by Council in its deliberation. After some consideration, I tend to agree, although the statutory mechanism seems to place the City in a somewhat untenable position. Ratification of BID Memo August 28, 2003 Page - 2 I have therefore attached a spreadsheet that illustrates the extent of the protest based upon percentage of protests represented by those projected assessments. These figures represent an annual budget of $60,000.00 and are based upon the most recent assessed valuations of the properties within the BID. Apparently Bill Goodman was using some older valuation figures so that these numbers before you don't match up exactly with those numbers presented to the signers of the petitions. However, they are very close. As you can see, the total percentage of protest, based upon projected assessment, is 27.68%, which is, again, short of the statutory threshold. Based upon the dialogue that has taken place over the last several weeks between the City Manager and those parties considering a protest and/or litigation, I have also added language into the resolution that creates the contingency of requiring an additional 25% tax assessed valuation to be added into the district by voluntary expansion before the authority is given to levy assessments. RECOMMENDATION: I recommend that a motion be made by a Council Member that the issue be brought back for discussion and consideration by Council so that the percentage of projected assessment analysis may be taken up. If Council then determines that the protests are inadequate based upon this evaluation as well, it should ratify its action previously taken to create the BID. FISCAL EFFECTS: The fiscal effects on the City are as previously discussed. Respectfully sumitted, Charles Harball, City Attorney Chris Kukulski, City Manager Office of City Attorney City of Kalispell Ratification ofBID Memo August 2Q,20O3 First Interstate Bank 173750 $ 76,843l0 823751 $ 77.250.00 160530 $ 77.250.00 160700 $ 77.250.00 180750 $ 77.250.00 160800 $ 77.250.00 160850 $ 4'386'950.00 Office ofCity Attomey RESOLUTION NO.4828 A RESOLUTION AMENDING RESOLUTION 4797 CREATING A BUSINESS IMPROVEMENT DISTRICT PURSUANT TO THE TERMS OF TITLE 7 CHAPTER 12 PART 11 OF MONTANA CODE ANNOTATED. WHEREAS, pursuant to Title 7 Chapter 12 Part 11 of Montana Code Annotated, the City of Kalispell is authorized to create business improvement districts; and WHEREAS, the City of Kalispell was presented with petitions signed by the owners of more than 60% of the area of the property to be included in the district, the exterior boundaries of which are shown on the attached Exhibit "A" and which by this reference is made a part hereof; and WHEREAS, the aforementioned petition requests that the City of Kalispell create a business improvement district for up to ten (10) years, pursuant to Section 7-12-1141 MCA; and WHEREAS, the purpose of said business improvement district appears to promote the health, safety, prosperity, security and general welfare of the inhabitants of the City of Kalispell and the proposed district, and appears to be of special benefit to the property within the boundaries of said proposed district as shown on the attached Exhibit "A"; and WHEREAS, on May 19, 2003 the Kalispell City Council issued Resolution 4792 declaring its intent to create a business improvement district for the city of Kalispell, Montana, to fix a date of a public hearing for June 16, 2003, and to provide for publication of notice of said hearing; and WHEREAS, the City Clerk caused proper notice of passage of the resolution to be published as provided in MCA 7-1-2121 and by mailing a copy of the notice to every owner of real property within the proposed district listed on the last completed assessment roll for state, county, and school district taxes, at the owner's last -known address, on the same day the notice was first published or posted; and WHEREAS, upon proper notice having been given and upon the expiration of 15 days as required by MCA 7-12-1113, the office of City Clerk did receive a number of written protests, although not in sufficient numbers to bar proceedings as allowed by MCA 7-12-1114 and said protests being duly considered and passed upon at a public hearing held June, 16, 2003; and WHEREAS on the 16th day of June, 2003 the Kalispell City Council issued Resolution 4797 establishing a business improvement district for the city of Kalispell; and WHEREAS, subsequently various landowners within the business improvement district have expressed concerns about the financial viability of the district within the currently defined boundaries and have made cogent arguments for the expansion of the district to include business properties contiguous to the business improvement district; and WHEREAS, the Kalispell City Council finds the arguments of these landowners compelling and agree that a larger district including more business properties will ensure the future success of the business improvement district. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF KALISPELL AS FOLLOWS: SECTION I. That the Kalispell City Council shall and does hereby create a business improvement district pursuant to Title 7 Chapter 12 Part 11, Montana Code Annotated the term of which shall be ten (10) years and which shall be known as the "Kalispell Downtown Business Improvement District"; PROVIDED HOWEVER, that the creation of such district and its authority to have assessments levied upon the properties in the district shall be contingent upon the events described below in Section 111. SECTION 11. Said business improvement district shall have boundaries as shown on the attached Exhibit "A" which by this reference is made a part hereof; provided, however, that all property classified as a commercial improvement within the district will be included in the district. All publicly owned property and owner -occupied single family residential property within the district are specifically excluded from the business improvement district and are exempt from its assessments. SECTION 111. The Business Improvement District shall have no authority to seek a levy of assessments upon properties within the district unless and until it has obtained, pursuant to MCA § 7-12-115, the voluntary expansion of the district, as currently defined, to include properties that will add at least 25% to the tax assessed value of the total district. Therefore, given the current total tax assessed value of the district is $951,949, the district must voluntarily expand to include additional properties with the aggregate tax assessed value of at least $237,987. PASSED AND APPROVED BY THE CITY COUNCIL AND SIGNED BY THE MAYOR OF THE CITY OF KALISPELL, THIS 2nd DAY OF SEPTEMBER, 2003. Pamela B. Kennedy Mayor Eve=" Theresa White City Clerk Legal Description Downtown Kalispell Proposed Business Improvement District Commencing at the intersection of Main and Center Street which is the True Point of Beginning; thence easterly along the centerline of East Center Street, 616 feet, more or less, to a southerly extension line of the west boundary of Lot 2, Phase 1 of Kalispell Market Place; thence northerly to the southwest corner of said Lot 2; thence continuing northerly along the west boundary of Lot 2 to the northwest corner of said Lot 2; thence easterly along the northern boundary of and to the northeast corner of said Lot 2; thence southerly along the easterly boundary of said Lot 2 to the southeast corner of said Lot 2; thence continuing southerly on 2nd Avenue East to an easterly extension line of Lot 1 of Block 37, Kalispell Original; thence westerly to the southeast corner of said Lot 1; thence continuing westerly along the southerly boundary of said Lot 1 to the centerline of the alley in of said Block 37; thence southerly through the alley to lst Street East; thence continuing southerly through the alley between Linderman School and Block 44 of Kalispell Original; thence continuing southerly through the alley of Blocks 57 and 64 of Kalispell Original to 4th Street East; thence continuing southerly through the alley of Block 77 to an easterly extension line of Lot 17 of Block 77, Kalispell Original; thence westerly along the southern boundary of said Lot 17 and crossing 1st Ave East to the southeast corner of Lot 2 of Block 76, Kalispell Original; thence continuing westerly along the southern boundary of said Lot 2 to the alley in said Block 76; thence southerly through the alley to an easterly extension line of Lot 20 of Block 76; thence westerly along the southern boundary of said Lot 20 and to the centerline of Main Street; thence northerly along Main Street to the intersection of 41h Street; thence westerly along the centerline of 4th Street East to a southerly extension of the alley of Block 67 of Kalispell Original; thence northerly through said alley to the centerline of 3rd Street West; thence easterly along 3rd Street West to the centerline of 1st Avenue West; thence northerly along 1st Avenue West to an easterly extension line of the southern boundary of Lot 7 of Block 54, Kalispell Original; thence westerly along the southern boundary of said Lot 7 to the alley; thence northerly through the alley, crossing 2nd Street West and continuing northerly through the alley of Block 47 of Kalispell Original, to an easterly extension line of the southern boundary of Lot 18 of Block 47; thence westerly along the southern boundary of said Lot 18 to the centerline of 2nd Avenue West; thence northerly along 2nd Avenue West crossing 1st Street West, to a westerly extension line of the southern boundary of Amended Lot 17 of Block 34, Kalispell Original; thence easterly along the southern boundary of said Amended Lot 17 to the alley; thence northerly along the alley to the centerline of West Center Street; thence easterly to the intersection of West Center Street and Main Street to the True Point of Beginning. The area proposed for the Downtown Business Improvement District encompasses approximately 42.4 acres. RESOLUTION NO.4797 A RESOLUTION CREATING A BUSINESS IMPROVEMENT DISTRICT PURSUANT TO THE TERMS OF TITLE 7 CHAPTER 12 PART 11 OF MONTANA CODE ANNOTATED. WHEREAS, pursuant to Title 7 Chapter 12 Part 11 of Montana Code Annotated, the City of Kalispell is authorized to create business improvement districts; and WHEREAS, the City of Kalispell was presented with petitions signed by the owners of more than 60% of the area of the property to be included in the district, the exterior boundaries of which are shown on the attached Exhibit "A" and which by this reference is made a part hereof, and WHEREAS, the aforementioned petition requests that the City of Kalispell create a business improvement district for up to ten (10) years, pursuant to Section 7-12-1141 MCA; and WHEREAS, the purpose of said business improvement district appears to promote the health, safety, prosperity, security and general welfare of the inhabitants of the City of Kalispell and the proposed district, and appears to be of special benefit to the property within the boundaries of said proposed district as shown on the attached Exhibit "A"; and WHEREAS, on May 19, 2003 the Kalispell City Council issued Resolution 4792 declaring its intent to create a business improvement district for the city of Kalispell, Montana, to fix a date of a public hearing for June 16, 2003, and to provide for publication of notice of said hearing; and WHEREAS, the City Clerk caused proper notice of passage of the resolution to be published as provided in MCA 7-1-2121 and by mailing a copy of the notice to every owner of real property within the proposed district listed on the last completed assessment roll for state, county, and school district taxes, at the owner's last -known address, on the same day the notice was first published or posted; and WHEREAS, upon proper notice having been given and upon the expiration of 15 days as required by MCA 7-12-1113, the office of City Clerk did receive a number of written protests, although not in sufficient numbers to bar proceedings as allowed by MCA 7-12-1114 and said protests being duly considered and passed upon at a public hearing held June, 16, 2003. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF KALISPELL AS FOLLOWS: SECTION I. That the Kalispell City Council shall and does hereby create a business improvement district pursuant to Title 7 Chapter 12 Part 11, Montana Code Annotated the term of which shall be ten (10) years and which shall be known as the "Kalispell Downtown Business Improvement District." SECTION II. Said business improvement district shall have boundaries as shown on the attached Exhibit "A" which by this reference is made a part hereof; provided, however, that all property classified as a commercial improvement within the district will be included in the district. All publicly owned property and owner -occupied single family residential property within the district are specifically excluded from the business improvement district and are exempt from its assessments. PASSED AND APPROVED BY THE CITY COUNCIL AND SIGNED BY THE MAYOR OF THE CITY OF KALISPELL, THIS 16th DAY OF J .-2443. ATTEST: 'Theresa White City Clerk EXHIBIT "A" Legal Description Downtown Kalispell Proposed Business Improvement District Commencing at the intersection of Main and Center Street which is the True Point of Beginning; thence easterly along the centerline of East Center Street, 616 feet, more or less, to a southerly extension line of the west boundary of Lot 2, Phase 1 of Kalispell Market Place; thence northerly to the southwest corner of said Lot 2; thence continuing northerly along the west boundary of Lot 2 to the northwest corner of said Lot 2; thence easterly along the northern boundary of and to the northeast corner of said Lot 2; thence southerly along the easterly boundary of said Lot 2 to the southeast corner of said Lot 2; thence continuing southerly on 2nd Avenue East to an easterly extension line of Lot 1 of Block 37, Kalispell Original; thence westerly to the southeast corner of said Lot 1; thence continuing westerly along the southerly boundary of said Lot 1 to the centerline of the alley in of said Block 37; thence southerly through the alley to lst Street East; thence continuing southerly through the alley between Linderman School and Block 44 of Kalispell Original; thence continuing southerly through the alley of Blocks 57 and 64 of Kalispell Original to 4th Street East; thence continuing southerly through the alley of Block 77 to an easterly extension line of Lot 17 of Block 77, Kalispell Original; thence westerly along the southern boundary of said Lot 17 and crossing lst Ave East to the southeast corner of Lot 2 of Block 76, Kalispell Original; thence continuing westerly along the southern boundary of said Lot 2 to the alley in said Block 76; thence southerly through the alley to an easterly extension line of Lot 20 of Block 76; thence westerly along the southern boundary of said Lot 20 and to the centerline of Main Street; thence northerly along Main Street to the intersection of 4th Street; thence westerly along the centerline of 4th Street East to a southerly extension of the alley of Block 67 of Kalispell Original; thence northerly through said alley to the centerline of 3Td Street West; thence easterly along 3rd Street West to the centerline of 1st Avenue West; thence northerly along 1st Avenue West to an easterly extension line of the southern boundary of Lot 7 of Block 54, Kalispell Original; thence westerly along the southern boundary of said Lot 7 to the alley; thence northerly through the alley, crossing 2nd Street West and continuing northerly through the alley of Block 47 of Kalispell Original, to an easterly extension line of the southern boundary of Lot 18 of Block 47; thence westerly along the southern boundary of said Lot 18 to the centerline of 2nd Avenue West; thence northerly along 2nd Avenue West crossing 1st Street West, to a westerly extension line of the southern boundary of Amended Lot 17 of Block 34, Kalispell Original; thence easterly along the southern boundary of said Amended Lot 17 to the alley; thence northerly along the alley to the centerline of West Center Street; thence easterly to the intersection of West Center Street and Main Street to the True Point of Beginning. The area proposed for the Downtown Business Improvement District encompasses approximately 42.4 acres.