Expanding TIF makes sense

The clock is ticking on Kalispell’s much-discussed Westside Tax Increment Financing District.

The district, in existence since 1997, will end next spring unless the city takes action to expand or extend its life. If the district sunsets, close to $2 million collected over the years would be paid out to taxing entities including the city of Kalispell, Flathead County and Kalispell Public Schools.

When the Westside district was formed, taxable property values inside the district were capped. Taxes collected beyond those caps because of growth or appreciation have been funneled into the tax-increment fund, which is meant to be used to help pay for projects that will spur job growth and economic development in the district.

To extend the life of the district beyond March (or to expand it), the city would have to issue new debt for a project inside its boundaries. The latest word is that the city would need to have a project identified by Thanksgiving this year in order to meet all the deadlines.

The city planning staff recommends expanding the district to include the Flathead County Fairgrounds and a mile-long block of land that runs along the railroad tracks from Seventh Avenue West to the eastern city limit, bordered to the north by Washington Street and to the south by First Street. The hope is that expanding the district could help capture a project.

And capturing a project has been an elusive goal in spite of more than a year of effort.

Expanding the Westside district could be the last, best chance to do what has been discussed for years: removing the railroad tracks that bisect Kalispell.

Relocating the tracks and the two businesses that use them is “one of those 30-year projects we keep never solving,” Planning Director Tom Jentz said recently.

If the railroad tracks could be removed and the area along the tracks developed, that would raise the tax base and address the primary mission of a tax-increment district: to support projects that increase tax revenue in the long run.

To do that, however, requires a lot of steps beyond just expanding the tax district. One step already has been taken: The Kalispell City Planning Board has recommended expanding the Westside Urban Renewal Plan. The plan is separate from but related to the tax-increment district, but this vote sets the stage for the next round of talks about the city expanding the Westside Urban Renewal Plan and ultimately the Westside Tax Increment Financing District.

We hope this effort to improve Kalispell stays on track (no pun intended), because finding a way to use the tax-increment money before the district expires may be the last chance for years to make a major improvement in Kalispell.