Resolution 5374 - Adopts Payment in Lieu of Taxes (PILT) PolicyRESOLUTION NO.5374
A RESOLUTION ESTABLISHING THE POLICY OF THE CITY OF KALISPELL
THAT THE CITY SHALL REQUIRE AN AGREEMENT OF PAYMENT IN LIEU OF
CITY TAXES (PILT) BETWEEN THE CITY OF KALISPELL AND ANY NON-PROFIT
ENTITY RECEIVING A TAX EXEMPT STATUS FROM THE STATE OF MONTANA
WHEN THAT ENTITY COMPETES DIRECTLY WITH LOCAL PROPERTY
TAXPAYING ENTITIES AND SEEKS SERVICES FROM THE CITY OF KALISPELL
REQUIRING A BUILDING PERMIT FOR NEW CONSTRUCTION THAT CREATES
ADDITIONAL ENCLOSED SPACE.
WHEREAS, the City of Kalispell provides services to the public, which services include fire
and police protection, amenities such as parks and recreation and other general
public services; and
WHEREAS, the City of Kalispell is only able to provide these valuable services through the
receipt of property tax revenues paid by City residents whose property is taxed;
and
WHEREAS, certain entities (non -profits) that own property in the City of Kalispell and receive
the valuable services of the City of Kalispell may apply for and receive a tax-
exempt status from the State of Montana Department of Revenue, in which case
all property taxes, including city taxes (not special assessments) are abated on the
theory that the community receives benefits from the entity that are equal to or
greater than the tax revenue otherwise generated by the entity; and
WHEREAS, certain non-profit entities that own property in the City of Kalispell and have
property taxes abated compete in the local market directly with for -profit entities
that pay city property taxes and therefore pay for the services provided by the City
and it is therefore the finding of the City Council of Kalispell that this presents an
undue advantage to the non-profit entity; and
WHEREAS, the City of Kalispell is currently significantly challenged to continue to provide an
adequate level of services to its taxpayers, partly as a result of the number of
entities that have applied for and received tax exempt status although the City
continues to provide its valuable services to these entities; and
WHEREAS, the City Council of the City of Kalispell finds that it is in the best interest of the
City, its taxpayers and citizens that entities, otherwise exempt from paying city
property taxes, and that compete in the local market with taxpaying entities and
that receive and benefit from the valuable services provided by the City make
reasonable payment to the City of Kalispell in the form of payment in lieu of City
taxes; and
WHEREAS, the City Council further finds that the necessary consideration triggering this
requirement shall be upon the application of the non-profit entity for a building
permit from the City for new construction that creates additional enclosed space.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
KALISPELL, AS FOLLOWS:
SECTION L That it shall hereby be the policy of the City of Kalispell to require an
agreement of Payment in Lieu of City Taxes (PILT) between the City of
Kalispell and any entity receiving a tax exempt status from the State of
Montana that competes in the local market with taxpaying entities when
that entity receives substantial valuable services from the City of
Kalispell.
SECTION II. That at such time as a tax-exempt entity applies to the City of Kalispell
Planning Department for a building permit for new construction that
creates additional enclosed space, the Planning Department shall negotiate
a PILT agreement with that entity for the City of Kalispell. The Planning
Department shall also prepare a cost of services analysis which shall
include an estimate of the City taxes the nongovernmental entity would
otherwise pay if it were not tax exempt as well as a reasonable annual
estimate of the cost of services the City provides to the property.
SECTION III. Upon reaching a tentative PILT agreement with the entity the City of
Kalispell Planning Department shall provide such agreement and cost of
services analysis to the City Manager who shall present it at the next
regularly scheduled City Council meeting for review and approval by the
City Council.
PASSED AND APPROVED BY THE CITY COUNCIL AND SIGNED BY THE MAYOR OF
THE CITY OF KALISPELL, THIS 6TH DAY OF JULY, 2009.
ATTEST:
Theresa White
City Clerk