I5. Reso 5843 - Husky TIF Granty+ City of Kalispell
i p Post Office Box 1997 - Kalispell, Montana 59903-1997
Telephone (406) 758-7701 Fax - (406) 758-7758
MONTA.NA
MEMORANDUM
To: Doug Russell, City Manager -D(L
From: Katharine Thompson, Assistant Director of Community & Economic
Development
Re: Husky Partners, LLC West Side — Core Area Tax Increment Financing
District Grant Funding Request
Meeting Date: October 16, 2017
BACKGROUND: Husky Partners, LLC submitted a West Side Urban Renewal — Core Area
Tax Increment Financing (TIF) District grant funding request. The company is developing a
three-story, 24-unit apartment project at 1110 Husky Street. Multi -family housing is a part of the
West Side — Core Area TIF Plan and addresses a need for rental housing in the area.
This development is a $2.2 Million project located within the West Side Urban Renewal
boundary and meets multiple TIF eligibility criteria. With consideration of substantial private
investment, the project meets the 1:9 ratio recommended in City TIF policy. The Urban
Renewal Agency recommends that Council approve the Husky Partners, LLC request for West
Side — Core Area TIF funding in the amount of $76,862.60 according to the following:
Eligible Uses/Costs
Grant Request
Site Demolition:
$2,817.25
$1,408.62
50% cost Site Demo/Prep/Cleanup
Site Preparation:
$82,512.03
$41,256.02
50% cost Site Demo/Prep/Cleanup
Street Parking/restore/repair:
$17,423.93
$8,711.97
50% cost Shared Utilities
City Curb/Gutter:
$18,971.98
$9,485.99
50% cost Shared Utilities
Sidewalk:
$11,306.97
$5,000.00
max Sidewalk Placement
Fiber Extension:
$7,500.00
$3,750.00
50% cost per Shared Utilities
Street Trees:
$4,500.00
$2,250.00
50% cost per Street Tree Prog.
Geotechnical Technical Asst:
$10,000.00
$5,000.00
max Technical Assistance
Total Eligible Costs:
$155,032.16
$76,862.60
Total Grant Request
The project will provide housing for a large number of people adjacent to the Kalispell Core
Area. Additionally, it will provide infrastructure improvements, improve pedestrian connections
and should increase property values within the area.
TIF grants are made on a reimbursement basis. The Urban Renewal Agency made no
recommendation on a schedule of payment for the grant, leaving this to the discretion of City
Council. Due to the upcoming bonding expectation, staff recommends limiting the
reimbursement to the annual amount of tax increment contributed to the West Side TIF fund
from this project. Under the proposed reimbursement plan, annual reimbursements would be
made from the annual increment revenues from this project until the total amount of
reimbursement equals $76,862.60. In the event increment values decrease in future years, the
reimbursement will be subject to the first priority of the City to cover debt service for bonds
related to previously approved projects and the bonds associated with obligations of the TIGER
grant funded project.
Due to concerns of the construction season, site preparation work is currently in progress. The
applicant has been advised, as outlined in the West Side Urban Renewal — Core Area TIF
District Policies, Procedures and Programs at page 5, "IMPORTANT: Costs to be paid with TIF
monies may not be incurred by the applicant prior to funding approval and the satisfaction of any
conditions of such approval unless specific approval has been granted by City Council. Any
expenditure is solely at the risk of the applicant if the project is not approved."
FISCAL IMPACT: Funding for this project will come from property taxes generated by this
project and is subject to the City being able to cover expenses related to previously committed
obligations.
RECOMMENDATION: The Urban Renewal Agency recommends that Council approve the
Husky Partners, LLC request for West Side — Core Area TIF funding in the amount of
$76,862.60. This reimbursement shall be on an annual reimbursement schedule limited to the
annual contribution of the project to the West Side TIF District Fund. This reimbursement shall
continue annually until it reaches the total amount of $76,862.60. Should increment values
decrease in future years, the reimbursement will also be dependent upon the City's ability to
cover debt service for bonds related to previously approved projects and the bonds associated
with obligations of the TIGER grant funded project.
ATTACHED:
Resolution 5843
Partial TIF Grant application
Architectural Review Documents
TIF Application Qualifying Criteria
RESOLUTION NO.5843
A RESOLUTION APPROVING THE KALISPELL URBAN RENEWAL AGENCY
RECOMMENDATION TO GRANT REIMBURSEMENT OF CERTAIN TAX INCREMENT
ELIGIBLE COSTS TO HUSKY PARTNERS, LLC IN THE AMOUNT OF UP TO $76,862.60
FROM WEST SIDE — CORE AREA TAX INCREMENT FUNDS TO ASSIST THE
REDEVELOPMENT OF BLIGHTED PROPERTY AT 1110 HUSKY STREET, KALISPELL,
MONTANA.
WHEREAS, the Kalispell Urban Renewal Agency (URA) is recommending, based upon the
application of Husky Partners, LLC, owner of the subject property located at I I10
Husky Street, Kalispell, Montana, that up to $76,862.60 of West Side — Core Area tax
increment funds be considered to assist in this redevelopment project consisting of a
three-story, 24-unit apartment project; and
WHEREAS, the property development is a $2.2 Million project located within the West Side
Urban Renewal District boundary that consists of multi -family housing that
addresses a need for rental housing in the area and otherwise meets multiple Tax
Increment Financing eligibility criteria; and
WHEREAS, the Kalispell City Council finds that the subject property is blighted, is located within
the West Side — Core Area Urban Renewal TIF District and is eligible for assistance
from the increment funds.
NOW THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
KALISPELL, MONTANA, AS FOLLOWS:
SECTION 1. The City Manager is hereby authorized to commit the use of up to $76,862.60
of West Side — Core Area tax increment funds for reimbursing Husky Partners,
LLC for tax increment eligible costs expended by them on the development
project described in the application that is currently before the Council.
SECTION 2. The City Manager shall make annual reimbursement payments to Husky
Partners, LLC only from tax increment revenues generated by the project at
1110 Husky Street, Kalispell Montana and shall only make such payments
from the West Side — Core Area increment funds remaining after the City has
covered debt service for bonds related to previously approved projects and
bonds associated with obligations of any TIGER grant funded project.
PASSED AND APPROVED BY THE CITY COUNCIL AND SIGNED BY THE MAYOR OF THE
CITY OF KALISPELL, THIS 16TH DAY OF OCTOBER, 2017.
Mark Johnson
Mayor
ATTEST:
Aimee Brunckhorst, CMC
City Clerk
City of Kalispell
West Side Urban Renewal District -Core Area Tax Increment Financing (TIF) Application
(Application must be completed in full with all required documents attached)
APPLICANT INFORMATION
Name of Applicant: SLice
Mailing Address: p /
Phone number:,i_ - Z0- �?�P� E-Mail: hjf6k,,pNtA1jt&�yt r , CawG
PROJECT INFORMATION
Business Name: _: 4kc
Business/Project Physical Address: 1 1 (0 hr 60Mror KkJ!tMQ ' Ktr-
Business Insurance Co: rV_'P
Tax ID # 8 2 - t 516 355-
Business Type (Corp, LLC, Partnership, etc.): LC,
Date business was formed: (,/ 1 f Zv t-7
Date of property acquisition:_ q &tJ W rl
Shareholders Name
Address
% Owned
-Jd'vtd Ec k evb (C
R !'7 n!E a"A � cyy u -. 4
ns 9?4Al3b'J
11402 AJ6 ZCqdA4,C1
ca
Z u
*A current financial statement for each shareholder involved in the project may be required as well
as documentation of financial capacity. (This information ;gill be lent confideili;dl, subicct to
challenge in a court of law.) r
Description of business (product or service provided etc.): _ K*#t- ELp!EE 4e1_ fir t*,
Annual amount of property taxes
Current on all property taxes: Yes �No
If no, explain circumstances:
Employment: Number of retained positions: ; Full Time: Part Time: 14/4-
Number of new positions to be created: ; Full Time: Part Time:
Average wage per hour $
Attachment: Attach an Excel spreadsheet briefly listing and describing the job classifications with
the average wage noted by each job classification. Provide a schedule of when the positions are
anticipated to be created and filled. NA
Provide a summary of the fringe benefits provided to employees: , q IA._ .
Project Architectural Firm: TA-U_ oLk- D UW OUZ-4 !yI t 6gc*ft-ej� ,2C.
Contact: fD6&!t:9 c _AM-QL4!
Address: n'Y `t 3 SB 14r
Phone:_ 799r°-bw E-mail: -zb 6AA.c . Ca
Project Contractor: k C
Address: ��1`� `'� �-f_4,$K4A—
Phone: E-mail:-M(CJ44C i kc. -W'f- GA�
Has such contractor or architect ever failed to qualify as a responsible bidder, refused to enter into a
contract after an award has been made, or failed to complete a construction or development contract
within the last 10 years? No Yes If yes, explain:
STATEMENT OF QUALIFICATION AND FINANCIAL RESPONSIBILITY
Has the applicant or any individual or entity affiliated with the development of this project been
adjudged bankrupt, either voluntarily or involuntarily, within the past ten years?
No ->/, Yes if yes, list date, place, and under what name:
Has the applicant or any individual or entity affiliated with the development of this project been
indicted for or convicted of any felony within the past 10 years?
No Yes if yes, list the date, charge, place, court and action taken for each case:
PROJECT EXPENSE WORKSHEET
Proposed project description: PWVL aP AAfbK.t wt _ t ktgQ- oc" Lp-30 4T
+loci kn-b Z4
o lit, 1 1�.9T3
Proposed Construction/Rehabilitation Costs: �-,ff kr"c9e+W4>
(If additional room is needed, provide an Excel sheet of expenses)
Explanation:
Cost: $
Explanation:
Cost: $
Explanation:
Cost: $
Explanation:
Cost: $
Explanation:
Cost: $
Explanation:
Cost: $
Explanation:
Cost: $
Explanation:
Cost: $
Architectural Design/Supervision:
Cost: $
Permitting Fees:
Cost: $
Additional Fees:
Cost: $
Additional Fees:
Cost: $
Total Project Expense: $
Attachment: Attach bids for each proposed project expense
Proposed project schedule with start date and completion date: r.'W- r4Tr-;,�--yep
CI
TIF FUNDING REQUESTED
(Refer to West Side Urban Renewal — Core Area TIF District Policies for more information)
Public Impact Categories:
Shared Utilities Extension: Eligible for a matching grant up to 50% of the project cost, not
to exceed $50,000.
X Sidewalk Improvement: Eligible for 50% grant match.
1� Tree Placement/Replacement: Up to 100% grant.
Private Investment Categories:
Private investment grant categories, in aggregate, may not exceed 10% of the total project cost.
Private investment loan categories, in aggregate, may not exceed ,$150,000.
Loan Programs:
Facade improvement: Eligible for loan dollars not to exceed $50,000
Rehabilitation/Code Compliance: Eligible for loan dollars not to exceed $50,000
Grant Programs:
Historic Facade Improvement: Eligible for a matching grant up to 50% of project cost not to
exceed $50,000
Site Preparation and Demolition: Eligible for a matching grant up to 50% of the project cost
not to exceed $50,000. (Additional grant or loan dollars may be available through the Kalispell
Brownfields Program)
Technical Assistance: Eligible for grant funding not to exceed $5,000
CERTIFICATION
I (we), �� 0�= (please print),
certify that the statements and estimates within this application as well as any and all documentation
submitted as attachments to this application under separate cover are true and correct to the best of
my (our) knowledge and belief.
Name:"
Signature:
Title:
Name:
Signature:
Title:
Date: 41• I ! ` I I Date:
Return to:
City of Kalispell Community & Economic Development Department
201 I5t Avenue East, Kalispell, MT 59901
406-758-7713 or 406-758-7738
kthompson rc,kalispell.com or klammersAkalispell.com
Required attachments:
• Excel spreadsheet briefly listing and describing the job classifications with the average
wage noted by each job classification. Provide a schedule of when the positions are
anticipated to be created and filled.
• Bids for each proposed project expense listed on page 3
• Letters of commitment or documentation from any project lender commitment listed on
page 4.
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HUSKY STREET APARTMENTS
5�4i HUSKY PARTNERS, ISLSC
� 1110P3YDSBS°Y STREET
Husky Partners, LLC
9-15-2017
TIF Application Qualifying Criteria:
1. Geographic location: This project, located at 1110 Husky Street, is within the block that fronts two if the listed
priority arterials— Meridian Road and Idaho Street.
2. Tax generation: This project will result in a substantial increase in property value with its corresponding increase
in tax. At final buildout, we anticipate the project valuation to be over $3m.
3. Relationship of public and private investment: This project, per the attached financial summary, constitutes a
substantial private investment. The requested public dollars is less than the listed 1:9 ratio.
4. .lob creation: This project will not directly create jobs. However, employee housing is a significant issue with
employers in the area and this project will have a direct positive effect.
5. Investment: This project will be an attractive addition to the area, bring people more into the City core and
promote additional development nearby through added population and activity.
6. Improvement of public services: The primary public service improvements to this area will be the street
improvements to Glenwood and additional public sidewalks improving walkability in the area. This will assist
tenants in using the many adjacent businesses.
7. Unique Opportunities: This project is much needed as housing is a known community need. Planned amenities
for the residents will also be a benefit,
8. Urban renewal goals: This project will further plan goals such as improving connections to the serving
neighborhood business, offload uncontrolled fill on the site to allow for redevelopment, remove a vacant lot
from the an established Kalispell neighborhood, provide off-street parking in excess of minimum zoning
allowances, provide landscaping and hard surfacing reducing windblown air contaminants from the
undeveloped site, and improve the neighborhood architecture.
9. Environmental impacts: Pedestrian access and safety will be improved with the new sidewalks planned for the
development. Off street parking in excess of zoning requirements support minimizing parking impacts on the
surrounding neighborhood. The attractive project in terms of landscaping and building architecture will have a
positive influence on the neighborhood. Offloading uncontrolled fill on the site and redeveloping the vacant lot
into hard and landscaped surfaces will minimize littering in the area and reduce windblown contaminants. .
10. Project Financing: See attached lender support letter for approved financing. TIF funds are a major factor in
moving ahead with this project.
11. Project Feasibility: During due diligence, the partnership interviewed 5 of the area property management
companies. Over and over, demand for housing was confirmed and frustration by tenants relocating to the area
for work not being able to find suitable housing. We also used these interviews to establish projected market
rates and the proposed TIF funding will assist us in achieving these goals.
12. Applicants ability to perform: Two members of this partnership are or have been owners in a 120 unit and 240
unit apartment project in Washington. The architect has extensive design experience in multi -family housing.
We have hired a local reputable contractor in Hammerquist Casalegno. We feel a strong team has been
assembled to make this project happen.
13. Timely completion: Hammerquist Casalegno has provided the attached schedule. The have a proven track
record of on -time performance.