Control of 'doughnut' area uncertain

A referendum aimed at repealing a 2010 planning agreement will be part of the Whitefish city election that begins this week when registered city voters get their ballots in the mail.

City voters also will be tasked with electing three new City Council members and a new mayor.

County residents who live in the “doughnut” planning area will not be able to vote on the referendum. The doughnut is the area extending two miles from city limits that has been the subject of a protracted jurisdictional dispute between the city of Whitefish and Flathead County.

Organizers of the referendum — Richard Hildner, Ed McGrew and former state Sen. Dan Weinberg — gathered 1,020 signatures by the April deadline to get the issue on the ballot.

They and other referendum supporters maintain there’s overwhelming public opposition to the 2010 doughnut agreement and believe the pact hampers the city’s ability to govern itself effectively and plan for future growth.

The Flathead County commissioners, not convinced there’s heavy support among doughnut residents for the city to govern how their property is regulated, are conducting their own poll of doughnut property owners.

Postcards will be sent to owners of 4,700 properties in the doughnut this month to ask one simple question: “Who do you prefer to regulate your property for zoning and planning purposes?” Response options are the county commissioners or the Whitefish City Council.

While the county’s poll will have no bearing on the outcome of the referendum, Commissioner Jim Dupont said the results will affect how the county deals with the city in the aftermath.

“If 90 percent [of doughnut property owners] say no,” that they don’t want the city to govern them, “it will affect my negotiations,” Dupont said.

It’s unclear exactly what will transpire if the referendum passes and the 2010 agreement is thrown out.

“It’s an odd set of circumstances,” Deputy County Attorney Tara Fugina said. “We don’t know what’s going to happen.”

State law says if an ordinance is repealed by referendum, the governing body may not for two years re-enact the ordinance. And if during that time the governing body does enact an ordinance similar to the one repealed, “a suit may be brought to determine whether the new ordinance is a re-enactment without material change of the repealed ordinance,” the state laws notes.

Whitefish City Attorney Mary VanBuskirk admits “there are a lot of balls up in the air,” but said if the 2010 agreement is repealed, she believes the city would go back to what existed prior to that agreement, namely the 2005 interlocal agreement.

The 2005 agreement was rescinded by the county commissioners in early 2008, but during legal proceedings in a lawsuit filed by the city of Whitefish against the county, Flathead District Judge Katherine Curtis returned the 2005 agreement to its status quo until the lawsuit was settled.

But since the lawsuit was dismissed as part of the 2010 agreement, the question many have is whether that status quo ruling still applies.

Former Whitefish City Attorney John Phelps, like his predecessor, believes a vote for repeal will mean the city will remain in charge of planning and zoning decisions in the doughnut, and he said as much in an opinion piece published Thursday in the Daily Inter Lake.

Dupont maintains just the opposite, that once the county and city signed the 2010 agreement, the 2005 agreement was null and void — and still is.

“There’s nothing to revert to, that’s the whole issue,” Dupont said. “If [the repeal] happens, we’ll take over zoning in the doughnut.”

Dupont helped forge the 2010 compromise, but later said city regulations such as the critical areas ordinance that put building restrictions on drainage-sensitive areas in the doughnut, along with the city’s lawsuit and the continuing battle for control, have left a pall of uncertainty that has affected real estate transactions and development in the doughnut.

Anticipating the effect a successful referendum vote could have on control of the doughnut, the commissioners in late June adopted a resolution giving a one-year termination notice to the city of Whitefish.

“I consider this a failure,” Dupont said after the commissioners voted to terminate the 2010 agreement. “There were too many groups, too many people arguing and too much litigation and too many lawyers.”

If the referendum fails and the 2010 agreement stays in place, mediation is required as part of the commissioners’ notice to terminate the agreement. Dupont said he’s hopeful the two government bodies can find common ground, but if talks break down, the county likely will proceed with the withdrawal process and take planning control of the doughnut.

WHEN JUDGE CURTIS ruled to dismiss the lawsuit in July and deemed the intervenors’ requests moot, she stated that the 2005 agreement “is void and is clearly superseded by the 2010 agreement.

“The 2005 agreement, which they (intervenors) seek to have validated, is void and no longer has any effect in the city of Whitefish,” Curtis wrote. “If the referendum passes, and if the city and the county decide to proceed in a manner that the proposed intervenors wish to challenge, those issues, which are not even justiciable at this time, must be brought in a separate proceeding.”

Heiko and Elizabeth Arndt and Westridge Investments were recognized intervenors in the lawsuit, while referendum organizers — Hildner, McGrew and Weinberg — had filed a motion to intervene.

Recognized intervenors to the lawsuit said they didn’t support the 2010 agreement because language that dealt specifically with providing representation to residents of the doughnut was removed as the two sides compromised. They wanted the representation issue adequately addressed.

ALL OF THE wrangling heretofore sets the stage for more litigation.

VanBuskirk noted that when the judge dismissed the city’s lawsuit, it was without prejudice, “so the parties can bring the same lawsuit.”

Phelps, in his opinion piece, said, “sure, the city may have to fight for its position, as it had to fight before.”

One of the issues in the original lawsuit was the county’s decision to unilaterally dissolve the 2005 interlocal agreement, even though it contained  language prohibiting either party from unilaterally withdrawing from or terminating the agreement. Since the lawsuit was dismissed, that issue never was resolved.

Phelps was among those who believed the city would have won the lawsuit.

Dupont said perhaps the only thing he can agree on with the city is that litigation lies ahead.

“It will turn into a legal nightmare,” he predicted.

Features editor Lynnette Hintze may be reached at 758-4421 or by e-mail at lhintze@dailyinterlake.com.