Paving not an easy fix for county roads

Flathead County residents are demanding more paved roads, but county officials say the money isn't available to put down more asphalt.

At a Dec. 18 public meeting concerning county road issues, rural special improvement districts were touted as an option to raise money for neighborhood paving.

Property owners may ask the commissioners to create an improvement district, which establishes an area outside the limits of incorporated towns and cities for the purpose of building, constructing or acquiring certain improvements authorized by Montana law for the benefit of the district. The property owners within the district then pay for the improvement - in this case, roads.

Some county property owners already have considered that option, only to find the costs are out of reach.

In April, Creston residents along Mennonite Church Road and Creston Road were stunned to find out that paving approximately three miles would cost them $1,036,769. Actual construction costs were $712,998, but county fees cost an additional $323,771, and include:

. Engineering costs to create RSID - $19,671

. Survey, design and construction observation - $96,500

. Attorney fee/bond council - $10,000

. Financial-adviser fee - $13,000

. Preliminary official statement fee - $3,000

. Underwriter's discount (2.5 percent) - $25,900

. County revolving funds deposit (5 percent) - $51,900

. County reserve account deposit (5 percent) - $51,900

. County administrative fee (5 percent) - $51,900

"Most of those costs don't even come to the county," Flathead County Administrator Mike Pence said. "The administrative fee comes to the county for ongoing collection of the funds and initial setup. It's an overhead fee.

"This is not an inexpensive approach. It's like buying a house - you have to pay all the closing costs."

IN ANOTHER case, Doug Barth spearheaded an effort to pave one mile of Bad Rock Drive near Columbia Falls. He gathered signatures from other residents along the road, had an engineer study the road's condition and began working with the county to create the improvement district.

The initial estimate from Schweigert Construction came in at approximately $120,000, but the county wanted three inches of rock placed on Bad Rock Drive before the paving. That bumped the price to $195,000.

Then the county tacked on the additional fees. Total cost for one mile of paved road: $463,410.

For the 50 property owners along Bad Rock Drive, that meant an increase of $600 in taxes per year for 15 years. Some owners have multiple parcels, meaning they were looking at an additional $1,200 to $2,400 each year.

Barth said the tax can be assessed evenly to the property owners or it can be based on the amount of acreage. Large landowners would be hit with a bigger burden.

"In our case, we had an elderly man with 40 acres," Barth said. "He's on a fixed income, and he would have had to pay almost $6,000 a year."

Barth said passing an RSID requires approval by 60 percent of the affected landowners.

"People could force these through, and it would force some people off their land," he said.

The county is looking at ways to reduce or eliminate some of the fees, Pence said. The attorney fee, financial-adviser fee, underwriter's discount and county reserve-account deposit are not required, but they help attract lower interest rates and interested financiers. If the Creston paving project eliminated those fees, the overall cost would drop by $103,000.

Flathead County currently is working with two road-paving districts without the extra fees.

"We're going to see how it works out and see if we can develop a good track record," Pence said.

THE CHEAPEST way for property owners to get roads paved is to pay up front with cash, but that approach isn't feasible for most residents. The Bad Rock Road landowners would have to raise $3,900 each to pave their road without creating the special district.

Rural special improvement districts may be a lost cause throughout most of the county. Most of those who spoke up at the meeting were not willing to pay more taxes to have paved roads. They complained they already pay taxes that go directly to the county, and increasing the financial burden on landowners is not fair.

"There's been a drastic cut in trust between the citizens and the Board of Commissioners," said Greg Dodd, a McMannamy Draw resident. "It would be wrong for me to pay for an SID now because of the mismanagement of the last 10 years."

Dodd claimed paving procedures in the past made little sense and left taxpayers stuck with funding an expensive solution.

But with the county's lack of money and the Legislature's unwillingness to provide money, few options remain. If the county paved all 700 miles of gravel roads, the cost would range between $70 million and $150 million. For citizens to pave all those roads through RSIDs, the cost essentially doubles.

The Flathead County road advisory committee is expected to deliver a report to the commissioners in the next eight months, but the road to a solution between the county and its residents may be long, bumpy and unpaved.

Reporter Michael Richeson may be reached at 758-4459 or by E-mail at mricheson@dailyinterlake.com