Kalispell Council weighs parking garage plan ahead of votes

Kalispell City Council discussed the details surrounding plans for a downtown parking garage during its Monday work session in preparation for several votes scheduled on the project at its next meeting on Oct. 3.

The city is looking to enter into agreements with Montana Development Partners to turn a parking lot at First Street West and First Avenue West into a parking garage with commercial space. The project also includes multi-family housing.

The project originated from a city request for proposals to redevelop the parking lot, and another city-owned lot on Main Street now planned for The Charles Hotel to be constructed by the same developer.

Councilors asked several questions about the number of parking spaces and how the parking garage that is planned to be privately owned would be managed. Some also took the time to express their overall thoughts on the project.

Councilor Ryan Hunter once again aired concerns about the parking garage, but did say the more recent addition of a housing component makes for a “better proposal.”

“I object to using city tax increment funding to pay for the parking structure,” he said. “We’re giving city land to the developers for free. The developer doesn’t need this incentive to engage in this project.”

Hunter added that his opposition is in regard to using city tax increment financing funds to pay for the 90 parking spaces that will be guaranteed for use by the hotel because he says that means the city is effectively subsidizing private parking. He also opposes using TIF funding to pay for the $530,000 for the value of the property on which the parking garage is planned to be constructed.

Councilor Sid Daoud spoke in favor of the project.

“I’m 100 percent behind filling our parking needs, but it’s also great to fill some of our housing needs,” he said.

Mayor Mark Johnson said the city could sell the parking lots and would get about $800,000 for the sale of both, but then would have no control over how those lots might get developed. As proposed, both the parking garage and the hotel project are estimated to generate $800,000 annually in tax dollars.

“We’re taking two pieces of property that [as parking lots] costs the taxpayers money and turning that into something that generates a significant amount of revenue,” he said.

The company is planning to construct a garage with about 240 parking spaces along with 6,200 square feet of commercial space for retail and office use at First and First. The public parking garage will be financed and constructed entirely by the developer.

In exchange, the city is proposing to reimburse the developer for the public parking garage construction from tax increment finance funds generated by The Charles Hotel and parking garage development.

The parking garage component of the project is estimated at $9.2 million. The parking garage will be owned and operated by the developer but leased back to the city.

IN REPRESENTING Montana Development Partners, Bill Goldberg said the parking garage on its own is a good project for downtown Kalispell. Adding the 78 multi-family housing units made it even better by providing an opportunity for folks to both live and work downtown. It also provides the opportunity for more density of housing in downtown, he said.

“I think you’re going to see more folks look at the opportunity for development in the downtown as a result,” Goldberg said. “This is the kind of activity that breeds other activities. As they see the continued development they are going to say now is the time to do something.”

City Manager Doug Russell outlined some of the benefits of the project to the city. Since the parking garage will be privately developed and owned, the risk of development as well as the burden to maintain and operate the garage will be placed on the developer. The parking garage also adds 130 parking spaces to the downtown, and both the hotel and parking garage will generate new tax dollars for the city, he noted.

“This is a project that meets the city’s downtown plans and comes out of a lot of efforts to revitalize downtown,” he said. “This comes from years of downtown groups saying we need to do something. This is an urban renewal project for the downtown.”

The parking garage and The Charles Hotel are estimated to represent a $75 million investment in Kalispell, the city notes.

DURING PUBLIC comment, a few people expressed concerns with the project.

Cassidy Kipp of Community Action Partnership of Northwest Montana, which operates out of a building on Main Street, expressed concerns about having enough parking in the area. She pointed out that the nonprofit has 48 employees and also needs parking for the clients it serves.

John Barr, owner of the Kalispell Grand Hotel, told Council he’s glad to see a new hotel come to downtown, saying it will benefit the entire business community. But he questioned whether there would be enough parking provided in the garage after including the housing added to the project and some of the parking spaces dedicated for use by The Charles Hotel.

“There needs to be parking for all the patrons of the businesses downtown,” he said. “No one is going to invest in downtown if there isn’t parking. This is very important for how downtown is going to develop over the next decades.”

ULTIMATELY, COUNCIL will have to approve the public parking garage development agreement, public parking structure lease agreement, and purchase and sale agreements for the transfer of the city lots to the developer.

The project also includes a conditional use permit request, which will have to be approved by Council, for the parking structure and for additional height over 60 feet for the building. The city has no height limit, but any building over 60 feet requires a CUP.

The parking garage is proposed to be eight stories or about 88 feet tall.

Features Editor Heidi Desch may be reached at 758-4421 or hdesch@dailyinterlake.com.

Editor’s Note: This story has been updated to reflect that Councilor Ryan Hunter objects to city funds being used for the spaces in the parking garage that will be dedicated for use by The Charles Hotel and using TIF funding to pay for the $530,000 for the value of the property on which the parking garage is planned to be constructed.