05/15/06 City Council MinutesA REGULAR MEETING of THE KA ISPELL CITY COUNCIL WAS HELD AT 0 00
.M. MON Avg MAY , oo , IN THE COUNCIL CHAMBERS AT CITY HALL .IN
KALISPELL, MONTANA, MAYOR. PAME A B. KENNE Y PRESIDED, . COUNCIL
MEMBERS JIM A KINSoN, BOB HERRoN, RANDY KENYO ", TIM KLUESNEK
.. ANE L .SON, AND HAND. OLSON WERE PRESET, COUNCIL MEMBER BOB
14AFFERMAN WAS ABSENT. COUNCIL MEMBER KAM GABRIEL ARRIVED AT 7:55
•M•
Also present; City Manager James Patrick, City .Attorney Charles Harball, Deputy City Clerk Jodi
Punk, Public Works Director Jiro Hansz, Pollee Chief Frank Garner, Fire Chief Randy Brode 1,
Parks and Recreation Director Mike Baker, Planning De rtmert Director Torn .he t. , and Building
Official Craig Kerzman.
Mayor Kennedy called the meeting to order and led the Pledge of Allegiance.
A, AGENDA APPROVAL
Kenyon moved approval of the Agenda. The motion was seconded.
Kenyon moved to amend the agenda by moving items E I. (ordinance 1574 - Hilton Garden
Inn Zone Change), and E (Old School Station SID 344 Engineering Amendment), to the end
of the Agenda. The motion was seconded.
Mayor Kennedy explained that Gabriel will be late aiRd wanted to be present for the discussion o
those topics.
There was no discussion.
The amendment carried unanimously upon vote with Gabriel and Hafferman absent.
The main motion as amended carried unanimously upon vote with Gabriel and Haf erma
absent.
B. CONSENT AGENDA APPROVAL
. Council Mites — e lar Meeti —May....l.,2006
2. Police officer Confirmation
Officers Ryan S iena and Dare Thomason have successfully completed their probationary
Period with the Kalispell Police Department and Council confirmation was requested.
Olson moved approval of the Consent Agenda, The motion was seconded.
There was no discussion.
The motion carried unanimously upon vote with Gabriel and Ha Ferman absent,
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May 15, 2006
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C. STUDENT ENT ISSUES
Nbne.
PUBLIC COMMENT
Joe G iXba lt, Lakeside, spore favorably about his partner Bob Welker and the proposed Hilton
Garde n Inn. He said he has known Welker for 15 Years and he is a man of s word. Guilbau I t stated
he would not be involved in this project if he didn't sincerely believe it would be a great thing for the
City.
Bob Welker,, Hilton Garden Inn developer, explained that providing the City with both the payment
in lieu of taxes and the net proceeds agreement would be difficult because the hotel will need time to
get op and running. Welker asked that Council give teem time to get started and eliminate the net
proceeds agreement. He announced they would lire to open the hotel by the end of May, Zoo , and
be shoved the Council a sample or the casi-no sign they would like to use which does not include the
word "casino".
E. REPORTLRECOMMENDATIONS AND SUBSEQUENT COUNCIL ACTION
E 1. ORDINANCE 15 —ADMINISTRATIVE RULES AMENDMENTS— 1ST READING
Due to recent changes made by the Montana Department of Labor and Industry, Kalispell is required
to make minor amendments to the it 's building, .plumbing, mechanical, and energy codes.
Atkinson moved first reading of Ordinance 1575, an ordinance to amend Ordinance No. 1499
y adopting, by reference, the amendments to the Administrative Rules of Montana at
2 .301.13 , 24,301,1469 24.30 ,1. 1, 24.301.1 2, 24,30 ,209, 24,301,3015 24,301,4019 24,301,421,
24,301,431. 24,301,4419 24,301,4515 24,301,4615 24,301,4819 24,301, 01� 24,301, , 4.301,711�
24.30t.718, and 24.30.1. 01, the adoption of new Rules 1 through 1X, and the repeal or A M
24.301.4719 24.301- 0 9 24,301.6129 4.301. 13, 24.301, 14, 24,301.6159 24.301.621 and
24.301.62,E as they may pertain to hose portions or the "International Building Code C 91
2003 Edition,, the "International Residential Code I . ", 2003 Edition, the "International
Existing Building 'ode"', 2003 Edition; the "International Mechanical Code" 9 2003 Edition;
and the "Uniform Plumbing Code", 2003 Edition, as previously adopted by the City or
Kalispell in ordinance No. 1499 as the building codes of the City of Kalispell, and applicable t
the nrisd ctional area thereof, subject to the amendments made, adopted and approved by the
Building Codes Bureau, Department of Labor and Industry, State of Montana; to provide a
penalty for the violation or any lawful order issued pursuant thereto-, and establishing an
effective date. The motion was seconded.
Kerman gave a staff .report.
There was no discussion.
The notion carried unanimously upon roll call vote with Gabriel and Haff r nan absent.
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May 15,2006
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E . RESOLUTION 5115 — PLANNING DEPARTMENT FEE STRUCTURE
Resolution 5115 addresses an increase in planning; fees.
Kenyon moved Resolution 5115, a resolution establishing planning fees to be charged by the
City of Kispe l's planning department and declaring an effective date. The motion was
seconded.
Jentz gave a staff report and answered questions.
Kf esner commented that after the Council discussed this issue in a work session, he felt the fees
should he higher because the general fond should not have to subsidize growth. He stated developers
should cover of all of the administrative costs associated with a project.
Olson agreed, stating; he didn't realize that growth wasn't paying for itself. He said he also Feels that
the fees should cover oo f the costs.
Jentz noted that not all of the planning department's work deals with new growth and development.
He said that phone calls, wally -in traffic, etc. do not deal with any specific developer or subdivision.
Olson stated a lot of the walk-in traffic and phone calls are generated because of development and he
still feels the developers need to pay oo of the costs.
Mayor Kennedy countered that development fees should pay for the individual developments, but the
planning office performs a lot of other work that does not deal with any specific developments. She
said the Council can't justify making the developers pay 00% of the work in the pl anning office.
Mayor Kennedy suggested Council adopt the proposed fees and then review the issue again in a later
work session.
Klesner asked for breakdown of the Planning Departme .t's budget prior to the work session.
Kluesner moved that Resolution 5115 be tabled to the first meeting In June. The motion was
seconded.
The motion to table failed upon vote with Herron and Klesner voting in favor, Atkinson,
Kenyon, Larson., Olson and Mayor Kennedy voting against, and Gabriel and. Hafferinan
absent.
There was no further discussion.
The motion carried upon roll call vote with Atkinson, Herron., Kenyon, Larson, Olson and
Mayan Kennedy voti i n favor, w uesner voting against and. G b.rlel and Hafferman absent.
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May 15, 2006
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Ei3. BOARD APPOINTMENTS — BOARD OF APJUSTMENT
Three letters of interest were received for three openings on the Board of Adjustment. Clint Cathcart
and John Michael K.op k are requesting appointment along with John Parsons, who is requesting
reappointment.
Mayor Kennedy recommended the Council appoint Clint Cathcart, John Michael Knop k and John
Parsons to the Board of Adjustment.
Larson moved the Council accept the Mayor's recommendation and appoint Clint Cathcart
and John Michael Knopik, and reappoint John Parsons, to the Board of Adjustment. The
motion was seconded.
There was no discussion..
The motion carried unanimously upon vote with Gabriel and Hafferman absent.
E 4. BOARD APPOINTMENT MEN — BUSINESS IMPROVEMENT DISTRICT
.Bill Goodman submitted the only letter of interest for two openings on the Business mpro e e t
.district Board.
Mayor Kennedy recommended the Council appoint Bill Goodman to the board.
Atkinson on moved the Council accept the Mayor's recommendation ation and appoint Bill Goodman
to the Business Improvement District Board. The motion was secondedS
There was no discussion..
The motion carried unanimously upon vote with Gabriel and Hafferman absent.
E 5. BOARD APPOINTMENT — CoNRAD MANSION BOARD of DIRECTORS
Tia Robbinhas requested reappointment to the Conrad Mansion Museum Board of Directors. No
other letters of interest were received.
Mayor Kennedy recommended the Council reappoint Tia Robbill#
Larson moved the Council accept the Mayor's recommendation and reappoint Tia Robbie to
the Conrad Mansion Museum Board of Directors. The motion was seconded.
There was no discussion.
The motion carried unanimously upon vote with. Gabriel and Hafferman absent.
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May 15, 2006
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E BOARD APPOINTMENT — PARKING COMMISSION
John Hinchey is requesting reappointment to another term on the Parking Commission. No other
letters of interest were received.
Mayor Kennedy recommended the Council reappoint John Hinchey.
Olson roved the Council accept the Mayor's recommendation and reappoint John Hinc ey to
the Parking Commission. The motion was seconded,,
`there was no discussion.
The motion carried unanimously upon vote with Gabriel and Hafferman absent.
E . Bow APPOINTMENTS — PLANNING Bow
There are three openings oia the Planning :hoard. John Hinchey and Bryan Schutt are requesting
reappointment. Clint Cathcart, Robyn Balcom, and John Michael Knop k are also interested in
serving.
Mayor Kennedy recommended John Hinchey and Bryan Schutt be reappointed, and Robyn Balcom
be appointed to the Planning Board.
Larson moved the Council accept the Mayor's recommendation and reappoint John In i c ey
and Bryan Schutt, and appoint Robyn Balcom to the Planning Board. The motion was
seconded.
There was no discussion.
The motion carried upon vote with Atkinson Herron, Kenyon, Larson, Olson and Mayor
Kennedy y voting in favor, Klesaner voting against and Gabriel and Hall man absent.
E. BOARD APPOINTMENT N — POLICE COMMISSION
Joan Jellison s requesting reappointment to the Police Commission. No other letters of interest were
received.
Mayor Kennedy recommended the Council reappoint Joan Jellison to the Police Commission.
Olson moved the Council accept the Mayor's recommendation and reappoint Joan Jellison t
the Police Commission* The motion was seconded.
There was no discussioll.
The motion carried unanimously upon vote with Gabriel and Hafferman absent.
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. BOARD APPOINTMENTS — RECREATION CENTER ADVISORY BOARD
Gib Bissell, Robert Germann, and Bob White are requesting appointment to the Con mun t
Recreation. Center Advisory Board.
Mayor Kennedy recommended the Council appoint Gib Bissell, Robert Gera , and Bob White to
the board.
Olson moved the Council accept the Mayor's recommendation and appoint Gib Bissell, Robert
Ger anon, and Bob White to the Community Recreation Center Advisory Board. The e motion
was seconded.
'there was no discussion,
The motion carried unanimously upon vote with Gabriel and Hafferman absent.
E 10. BOARD APPOINTMENTS — REVOLVING LOAN COMMITTEE
Four letters of interest were received for three openings on the Revolving man Committee. Those
interested in serving are Wade Elder, Daniel . clerc, Dave Hanson, and Justin Sliter. Hanson is
currently a board member.
Mayor Kennedy recommended the Council reappoint Dave Hanson, and appoint wade Elder and
Justin Suter to the Revolving; Loan Committee.
Larson moved the Council accept the Ma or's recommendation and reappoint Dave Hanson,
ftr
and appoint Wade Elder and Justin Suter, to the Revolving Loan Committee. The motion was
seconded.
There ra.s discussion,
The motion carried unanimously upon vote with Gabriel and Haffern an absent.
E 11. BOARD APPOINTMENT — STREET TREE COMMISSION
Jana Ostrom has requested appointment to an open seat on the Street Tree Commission,
Mayor Kennedy recommended the Council appoint Jana Ostrom to the Street Tree Commission.
Atkinson moved the Council accept the Mayor's recommendation and appoint Jana Ostrom
to the Street Tree Commission. The motion was seconded.
There was no discussion.
The motion carried unanimously upon vote with Gahriel and Hal erman absent.
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May 15, 2006
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E 2. APPROVE INCREASED ENGINEERING CEILING „" OLD SCHOOL STATION
SID 34
SID 344 infrastructure has changed from a single phase, 70 construction days project, to a three
phase, 1.510 construction ctio,n days, project. The requested increase o $ 21, ' 7 is necessary to fund the
extra 80 days of construction engineering support for the project.
Larson moved Council approve the increased project engineering ceiling for Old School
Station SID 344 infrastructure construction. The motion was seconded.
.mayor Kennedy announced for the record that Gabriel had arrived.
Hansz gave a staff report.
Olson asked Irby this was not defined earlier.
Hansz explained that when Morrison & Ma .erle was brought on board their job was to help the City
design and put this into the -form of a project. He said at the time the City had not made the final
decisions on exactly what the scale and scope of that project was going to be. HansHansz stated as the
SID process unfolded, the decision was made that the SID was going to include virtually all of the
public infrastructure inside that development. He further explained that the engineers made the best
estimate on what little was known at the time and it was -understood that once there was a better
understanding o1 the project, a change would be requested. He said the water phase project was
completely restructured and the engineering and repackaging of the lards had to be done to make the
project more attractive to bidders, adding the money has been factored into the SID and the project
budget. Hansz noted this is unusual because the City is not usually involved in a project like this.
Herron commented that to put this in perspective, bonds were sold for 4.5 million dollars and the
proposed budget is 4.375 million dollars. He said even though h the engineering contract is double, it
is still within the total budget.
parson added the time frame has doubled, so it follows the cost would double.
Kluesner stated regardless of hove it came about, the increased cost doesn't make him happy.
Larson restated his motion that the Council authorize an increased project engineering ceiling
for Old School Station. SID 344 infrastructure construction in the amount nt o $239,835.00 which
is an increase over the original contract o $1 1,7 7.00. The second concurred.
The amended motion carried unanimously upon vote with Rafferman absent.
E 13. ORDINANCE 1574 — ZONE CHANGE REQUEST — HILTON GARDEN INN -�
2ND READING
Robert Welker has requested a zone change from -1, .public, to -2, General Business, and a
Planned Unit Development overlay on a three and a half acre lot located on the Armory property.
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May 15, 2006
Page
Ordinance 1574 passed on first reading May 1 with several amendments.
Kenyon moved second reading of Ordinance 1574, are ordinance to amend Section .02;0o,
Official Zoning Map, City of Kalispell Zoning Ordinance, (Ordinance No. , by zoning
certain real property more particularly described, as Tract 1 of Certificate of Survey No.
17045, a tract of laird, situated, lying, and being in the north half of the Northwest Quarter of
Section 20, Township hip North, Range 21 west, .M.M# Flathead County, Montana
(previously zoned City P-1, Public) to City -2 (General Business), with a Planned Unit
Development overlay in accordance with the Kalispell Growth Policy 2020, and to provide an
effective date* The lotion was seconded.
Mayor Kennedy explained several amendments have been provided to the Council and are being
offered by the developer.
Larson moved that Ordinance 1574 and all referenced documents he amended to replace the
name Gateway Hospitality Group or Robert Voel .er with the name of the Montana Entity of
Kalispell .motels, LLC, a Montana Limited Liability Company, of P.O. Box 1068,741 Lakeside
Blvd, Lakeside, MT 59922. The motion was seconded.
There was no discussion.
The amendment carried unanimously ly upon vote with Hafferrrran absent.
Patrick addressed the remaining in amendments is requested by the developer. As far as the payment in
heu of taxes, he stated the developers' concern is that it takes time for a hotel to start making money
and th t*s why they are asking for a.n amendment concerning it the payment in lieu of taxes. He said
voelker would lie to pay the normal amount of taxes due during the first year of operation and
place the payment in lieu of taxes on the back end at full cost. Patrick further explained that the other
amendment the developer would like is for Council to remove the requirement of a Net Proceeds
Agreement.
Atkinson moved that the Ordinance No. 1574 and the Development Agreement at V. TAXES
AND PAYMENT IN LIEU of TAXES be amended to state as follows;
IV, TAXES AND PAYMENT 1N LIEU of TAXES
Payment in Lieu of Taxes. It is contemplated that the completed Hilton. Garden Inn and
Conference Center Project [Project Property] will generate annual tax revenue to the CITY in
the amount of approximately TWO HUNDRED SIXTY THOUSAND AND N0 100
DOLLARS $2 o,000.00 upon completion of the Project, exclusive of city or county special
assessments. Developer, therefore, covenants to pay the City any difference between the
amount of tax actually generated by the Project Property, including any portion of the Prqject
transferred to another owner, and the amount contemplated, by this Agreement for a period. of
W 2 years commencing with tax payment due November 30, :2008# Payment under
the provisions of this paragraph shall be made directly to the City, after certifying the tax
generated by the Project Property through the City finance department subject to verification,
and in accordance with the following.
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May 15, 2006
Page 8
L For tax year, 20H.P2008, a copy of the tax bill for the tax year, 2008 shall be
delivered to the City finance ofee on or before November 1, :2008.
2. The City finance ogee shall calculate the difference between the tax bill for the
2008 tax year, exclusive of special assessments, and the sum of TWO HUNDRED AND
SIXTY THOUSAND AND No 100 Doi $ o,l oo.oh and invoice the Developer
for the difference.
3. Half of the payment for said amount calculated shall be due and payable, from the
Developer, on or before December 15, 2W 2008. The second half of the payment for
said amount calculated shall be due and payable, from the Developer, on or before May
3,.
. For tax year 1009, a copy of the tax bill for the respective tax year shall b
delivered to the City finance office on or before November 15.
. The City finance office shall calculate the difference between the tax bill for the
respective tax year, exclusive of special assessments, and the sum of TWO HUNDRED
AND SIXTY THOUSAND AND N 1ho Doi $2 , o . and invoice the
Developer for the difference.
. Half of the payment for said amount calculated shall be due and payable, from the
Developer, on or before December 15, . The second half of the payment for
said amount calculated shall be dine and payable, from the Developer, on or before May
31, 2010.
In tax years when the tax liability, less special assessments, equals or exceeds the sum of
$260,000.00, no payment -in -lieu shall be due from the Developer, however, no credit shall be
given for subsequent tax years." The motion was seconded.
Atkinson asked Patrick if the amendment would net the City the sane dollar amount as the original
ordinance would have.
Patrick stated this has the potential of actually bringing in additional revenue, because in the first
year the developer would pay taxes on the lard that is currently not taxed plus on whatever portion of
the building; that is constructed in November and December.
Mayor Kennedy asked for clarification, stating the original motion has the payment in lieu of taxes
starting in Zoo . She said delaying it one year could not bring more money; t Lou d i less
.money by one year.
Patrick noted the developer would be paying taxes on whatever portion of the building that is up
starting December I of this year, along with the taxes on the land. He said the following two years
the developer would be making the payment in lieu of taxes ensuring; that we would get up to
$260,000 the third year.
Mayor Kennedy still disagreed that it means more .money for the City.
Kalispell City Council Minutes
May 15, 2006
Page
Larson commented he feels the City will be losing $130,000 if this amendment passes because the
City can't make him pay at the end of the agreement. He said if the Council approves this
amendment tonight, we are going `'to gut what we did two weeks ago". Larson said you have to ask
whether you want the money to go to the citizens of Kalispell, or into the developers' pockets.
Herron emphasized that none of this money is going into the general fund for the next 15 years; it is
going into a TIF district. He said this is what TIF districts are meant for,, to bring businesses in and
put them on the tax rolls. Herron stated the City is getting a convention center that nobody else
would ever build in this community with these kinds of dollars. He said it is our obligation to use the
TIF district, and we should not penalize the developer for wanting to use it.
Mayor Kennedy stated that once we have spent the $890,000, there will be no money available for
other projects in the TIF district until the following tax year and the City would not be able to meet
additional needs if they arise. She said that is why the Council wanted the payment in lieu of taxes, to
pot money back into the TIF district.
Olson reminded everyone that the $890,000 will be replaced and will go into another project in that
TIF district to redevelop something else. He said he would like to have the $130,000, but he agrees
this project will be of economic benefit to the entire community and because of that be will vote in
favor of the amendment.
Larson agreed that this is a good project, but we are making the assumption that if we don't do
everything the developer wants, he will back out. He stated we don't need to make that assumption
and the money in the TIF fund could be replaced a lot faster with the $ 3o,000.
Mayor Kennedy commented she was prepared to vote in opposition to the amendment earlier, but
after the discussion tonight she has decided she will vote in favor of it. She said she can understand
the developers' concern with the bottom dollar and even though the City may be losing a little bit of
.money by extending the payment in lieu of taxes one year, it won't be a significant loss to the
district.. Mayor Kennedy added, .however, the Net Proceeds Agreement is an important piece of the
project and it should remain.
Kenyon agreed with Mayor .bendy and noted that the City has given up the height restriction, the
casino, the site remediation,, and now we are looking at rolling over on the 2007 TIF and potentially
the net proceeds. He agreed that $ 130,000 the first year puts the developer in a difficult position, but
he hopes we don't roll over on the net proceeds aspect of the deal.
Larson commented we have given up everything so far, and if we give op the first year we'll never
get it back.
The amendment carried upon roll call vote with Atkinson, Gabriel, Herron, Kluesner, Olson
and Mayor Kennedy voting In favor, Kenyon rid Larson voting against, and Rafferman
absent.
There was no further discussion.
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May 1, 2006
Wage 10
The main motion, as amended twice,, carried upon roll call vote with Atkinson, Gabriel,
Herron, Kenyon, Kluesner, Olson and Mayor Kennedy voting in favor, Larson voting against
and Hafferman absent.
F. MAYo Co UNCILCITY MANAGER'S REPORTS (No Action
Mayor Kennedy reminded Council that City Hall is hosting a blood drive for City employees and
Council members this Friday from 10:00 are to .00 pm.
Mayor Kennedy informed the public that an easement has been granted for the Foys to Blacktall
Trail project on the ridge overlooking Herron Park and Smith fake. She invited Council members to
attend a presentation on the trail project at Herron Park this Friday at 9:00 a.m..
Mayor Kennedy reminded Council and the public about the presentation. "Are You Ready for the
Next Generation?"' being held on May 25 from noon until 2:30 p.m. at the west Coast Kalispell
Center Hotel with a reception following at Reds, Wines and Blues.
Patrick updated Council on the slope failure at Granary Ridge; the engineer's report stated the slough
was a continuation a past slip and not due to the Granary Ridge project. He said that high ground
water and old fill materials aggravated the problem and that the developers have complied with all
recommendations that were made and no adverse issues were found.
Patrick stated there will be a TIF seminar in Helena on May 25 at 9:00 are and if anyone is interested
a
in attending to let him know.
G. ADJOURN
The meeting was adjourned at 9:20 p.m.
ATTEST:
Theresa White
City Clerk
Approved June , 200
Kai ispell City Cound I M inu tes
May 15, 2006
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