Council OKs tax district expansion

A proposed expansion of Kalispell’s West Side Tax Increment Financing District cleared the first of two City Council readings Monday with a solid 8-1 vote of support.

“I see the potential it has and the importance it has for the future of the city,” council member Phil Guiffrida III said.

The expansion must clear a second reading at the next regular City Council meeting.

If approved, the district’s existing boundary would grow to include 364 acres of “railroad corridor” land being targeted for redevelopment in the Kalispell Core Area Revitalization Plan.

Officials see the tax increment financing district and its pot of money as an important tool to help spur private investment in the railroad corridor over the next two decades.

One of the main goals taking shape in the core area revitalization plan is to remove the railroad tracks and relocate the last two businesses that use them to the Flathead County Rail Park being developed at the city’s eastern edge. That would free up a large swath of formerly industrial land in Kalispell to be redeveloped into a vibrant urban core.

Council members stressed they will support returning some of the tax increment money the district collects to the general funds of the city, county and schools if those requests are made.

They also stressed they hope to see more tax increment-funded projects inside the district’s original boundary area.

“We cannot forget where this TIF began on that [west] end of town,” Mayor Tammi Fisher said. “I think we should leave that open and not dedicate all of the funds to that core area.”

The West Side Tax Increment Financing District was created in 1997 and on track to sunset this past March. As that date approached, the City Council extended its life for up to 25 more years by issuing $500,000 in bonds to pay for a water-line upgrade on West Colorado Street and improvements to South Meridian Road.

The district’s fund holds $2.3 million and generates about $400,000 in tax increment a year. That’s money Kalispell can tap to improve infrastructure, eliminate blight, foster investment that leads to job creation and property value growth and accomplish other goals spelled out in its urban renewal and revitalization plans.

Council member Bob Hafferman was the lone vote against the expansion, calling it a “scam” by Kalispell to both hang on to the tax increment money and collect more in years to come.

That assertion was disputed by council members Wayne Saverud, Jim Atkinson and others.

Atkinson said the city, county and schools all stand to benefit if the railroad corridor and other areas of the city can be revitalized with help from the tax increment financing district.

“When it does sunset, the schools and county and city all have a much higher tax base to work with from that point forward,” Atkinson said. “This is a tool — not a scam — a tool the Legislature has allowed us to use to build up our community and tax base in a very positive way.”

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