Council keeps door open for expanding tax district

The Kalispell City Council voted 7-1 Tuesday to follow a planning department staff recommendation and take at least a first step toward possibly expanding the Westside Tax Increment Financing District.

The approved resolution tasks the city Planning Board with investigating to see if there is enough blight in surrounding areas to warrant expanding the tax district, and then coming back with a formal recommendation for the council.

“That whole process includes mailings to property owners in the affected area,” City Manager Jane Howington said to council members.

“They are going to have public hearings, talk to other partners ... That’s when the stones get turned over.”

The city planning staff said they think there is enough blight in surrounding areas to warrant an expansion of the district, which was formed in 1997.

A recommended expansion would include the Flathead County Fairgrounds and a mile-long block of land that runs from Seventh Avenue West to the eastern city limit, bordered to the north by Washington Street and to the south by First Street.

The only way to extend the life of the westside district beyond its scheduled sunset date in March 2012 is for the city to incur new debt for a project in the district before then.

Council members spent more than an hour discussing possible projects, but it’s not clear if a suitable project will arise in time.

Advocates hope that expanding the district could capture a range of suitable projects.

Early proposals include improvements to the fairgrounds, water and sewer line improvements, new sidewalks, new streets and possibly even the removal or relocation of the railroad tracks that run through the center of downtown.

Council member Bob Hafferman was the lone vote against the resolution.

Hafferman argued, along with several other people, that there are no viable TIF projects, including projects in the proposed boundary expansion, and that the district should be allowed to sunset as scheduled.

If it sunsets, close to $1.8 million held in its fund as of August, along with any other revenue that comes in, would be disbursed to taxing entities including the city of Kalispell, Flathead County and Kalispell Public Schools.

That windfall could boost cash-strapped budgets and help take some of the strain off taxpayers, supporters maintain.

“The schools could use it. The county could use it. I know the city could [because] we’re talking about a nine cent transaction tax to fix potholes,” former council member Dale Haarr said during a public comment period.

“I’ve been to a few funerals this year, usually to celebrate a life. To celebrate this funeral would be a real good one,” Haarr said.

Several people argued in favor of expanding the tax-increment district, or at least passing the resolution Tuesday night to allow the Planning Board to investigate the proposal and give more time for a possible project to materialize.

They included former mayor Doug Rauthe and Kim Morisaki, a representative from Montana West Economic Development Corporation and the Flathead County Economic Development Authority.

Ultimately, the majority of council members backed this view.

“We are not making a decision to spend money or anything. This is simply to see if the Planning Board can come up with any interesting ideas for us to pursue in the future,” council member Randy Kenyon said to explain his vote.

Mayor Tammi Fisher also supported the resolution and thanked city staff and the Urban Renewal Agency for their work and recommendation.

“This vote means we’re willing to look at our options, that’s it,” she said.

Reporter Tom Lotshaw may be reached at 758-4483 or by email at tlotshaw@dailyinterlake.com.