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HomeMy WebLinkAboutA4 - Midtown URD Workplan and Budget Commission Memorandum REPORT TO: Honorable Mayor and City Commission FROM: David Fine, Economic Development Specialist, Midtown Urban Renewal Board Staff Liaison SUBJECT: Midtown Urban Renewal District Fiscal Year 2017 Budget and Work Plan MEETING DATE: June 13, 2016 AGENDA ITEM TYPE: Action RECOMMENDATION: Review the attached materials, listen to the Board presentation, ask questions, and provide direction on the Midtown Urban Renewal Board’s proposed FY 2017 Budget and Work Plan. If approved by the City Commission, the Midtown Urban Renewal District Work Plan and Budget Proposal will be adopted as part of the City of Bozeman’s FY 2017 Budget. BACKGROUND: On May 31, 2016 the Midtown Urban Renewal Board (MURB) unanimously approved the attached FY 2017 Budget from which staff prepared the proposed FY 2017 Work Plan and Budget. The total value of appropriations in the MURB budget request for FY 2017 is $1,054,661. The total value of new appropriations is $991,000. The MURB proposes a work plan and budget and submits a report on an annual basis per Section 7-15-4237 of the Montana Code Annotated (MCA) (1) An agency authorized to transact business and exercise powers under this part and part 43 shall file with the local governing body, on or before September 30 of each year, a report of its activities for the preceding fiscal year. 196 (2) The report shall include a complete financial statement setting forth its assets, liabilities, income, and operating expenses as of the end of the fiscal year. FISCAL EFFECTS: Based on the State-wide Reappraisal of Property Values for the 2015 tax year, the incremental taxable value of the Midtown TIF decreased 13.9% in FY 2016. The decrease in value is largely attributable to the timing of appraisal cycles and the Great Recession, though the taxable value of the Midtown increment was substantially greater than the decrease for the City as a whole of 1.5%. The Midtown Urban Renewal District has significant cash reserves, which are adequate to undertake the proposed Work Plan and Budget. ATTACHMENT: Midtown Urban Renewal District Annual Report and Work Plan and Budget Midtown Urban Renewal District Map 197 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Fiscal Year 2016 Annual Report and Fiscal Year 2017 Work Plan and Budget Page 1 of 10 Fiscal Year 2016 Annual Report The City Commission passed Ordinance No. 1685, “Adopting an Urban Renewal Plan for the North Seventh Avenue Corridor and Adjacent Properties”, on November 27, 2006. On December 16, 2015, the City Commission passed Ordinance No. 1925, which adopted a new urban renewal plan, expanded the boundaries of the original district, and renamed the North Seventh Urban Renewal District the Bozeman Midtown Urban Renewal District. The new Midtown Urban Renewal Plan provides for the remediation of blighted conditions within the urban renewal area by advancing five broad goals through a series of implementing activities and strategies. The five goals include the following items: 1. Promote Economic Development • Rationale: Economic vitality strengthens the community, provides for physical needs of the citizens, opens reinvestment opportunities, and helps to eliminate the conditions that contribute to blight. 2. Improve Multimodal Transportation • Rationale: Increasing travel options supports public health, reduces resource demand, increases efficiency and reduces costs, improving the quality of life and making the community a better place to live and work, helping to eliminate conditions that contribute to blight. 3. Improve, Maintain and Support Innovation Infrastructure • Rationale: Infrastructure is the backbone of the community. Private development typically requires a corresponding public investment in infrastructure. Therefore, capital improvements in the district will help achieve economic vitality and address conditions that contribute to blight. 4. Promote Unified, Human Scale Urban Design • Rationale: Protecting and building upon existing physical assets increases vitality, desirability and leverages economic development, strengthening community values and mutual support helping to eliminate the conditions that contribute to blight. 5. Support Compatible Urban Density Mixed Land Uses • Rationale: A sense of place is strengthened by a strong core identity. Increasing live- work opportunities and community interaction, ensures that the North 7th Avenue area remains a great place to live, work, operate a business, and play, and helps to eliminate conditions that contribute to blight. 198 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Fiscal Year 2016 Annual Report and Fiscal Year 2017 Work Plan and Budget Page 2 of 10 District Expansion The City Commission expanded the boundaries in the Midtown Urban Renewal District in December, 2015, as part of adopting a new urban renewal plan. The new plan explains the rationale for this expansion: “In March of 2015, the City Commission provided funding for the NSURB [North Seventh Urban Renewal Board] to examine several areas adjacent to the North Seventh Avenue Urban Renewal District, to determine whether the district could be expanded in order to better meet its goals and objectives. The NSURB had become concerned that the failure to address blighted conditions in these areas had stymied rehabilitation and redevelopment within the existing district. In addition, the existing North Seventh Avenue Urban Renewal District was, in some places, only one block from the Downtown Area Urban Renewal District, further exacerbating the lack of connectivity between the two areas. While the area in between was characterized by the same conditions that were present in both districts, it could not take advantage of ongoing urban renewal programs.” (Bozeman Midtown Urban Renewal Plan, 2006) Urban Renewal Plan Update The Midtown Urban Renewal Board (MURB) engaged consultants from Community Development Services of Montana to draft a new urban renewal plan that included an expanded program of planning initiatives, program initiatives, and capital projects from implementing each of the five enumerated district goals for addressing blight within the district. The Plan was adopted by the City Commission in December, 2015. New Zoning The MURB contributed funding to an effort led by the City’s Community Development Department to create new zoning districts that supported redevelopment efforts within the Midtown District. While the City Commission had adopted the Design and Connectivity Plan for the North 7th Corridor in 2006, the existing zoning regulations were at times in conflict with the goals of the Plan and prohibited the sorts of development patterns it prescribed. The effort created two new zoning districts R-5 (Residential High Density Mixed District) and B-2M (Community Business Mixed District). The new zoning districts take a form-based approach to encourage the sorts of pedestrian friendly, mixed-use developments contemplated by the Design and Connectivity Plan and the Midtown Urban Renewal Plan. Lighting and Sidewalk Project Phase 2 – Juniper St. to Durston Rd. The MURB continued its project of installing green boulevard strips, setback sidewalks, and decorative streetlights along the N. 7th corridor. The project has, in most cases, required obtaining easements for the sidewalk setback from each property owner. This phase skipped the parcels currently occupied by Cat’s Paw, Debos Pawn, Action Pawn, and ReCompute, as we were unable to negotiate easement donations from these property owners. Staff is pursuing new streetscape designs to accommodate property owner concerns in the coming fiscal year. 199 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Fiscal Year 2016 Annual Report and Fiscal Year 2017 Work Plan and Budget Page 3 of 10 Rehabilitation and Technical Assistance Grant Programs The Technical Assistance program supports current or potential developers, owners, and tenants with engineering and architectural technical assistance during the preliminary phases of possible redevelopment or rehabilitation projects within the district. The Rehabilitation Program provides for up to 15% of eligible project costs for exterior enhancements to building and sites. • Midtown Tavern (formerly Ferraro’s Fine Italian Restaurant) – 726 N. 7th Ave. o This technical assistance grant was for significant updates to the restaurant façade and landscaping including the addition of a large street facing outdoor patio.  Technical Assistance Grant Amount: $7,200  Rehabilitation Grant Amount: up to $20,730 for implementing the façade and landscaping updates. • Tarpon Bay Partners LLC (formerly Brinkman Court Reporting) – 612 W. Beall St. o This technical assistance grant was to for radical updates to the façade of a vacant and functionally obsolete office building, as well as site enhancements to provide for ADA accessibility.  Technical Assistance Grant Amount: $7,200  Rehabilitation Grant Amount: up to $20,730 for implementing the façade and landscaping updates. • Comfort Inn – 1370 N. 7th Ave. o These grants were for doing modest updates to the stone façade treatments, landscaping, and parking lot lighting at the Comfort Inn.  Technical Assistance Grant Amount: $1,512  Rehabilitation Grant Amount: up to $14,131 for implementing the façade and landscaping updates. • Gallatin Valley Furniture Carpet One – 923 N. 7th Ave. o This grant was to study making improvements to the façade of the building.  Technical Assistance Grant Amount: $7,200  Rehabilitation Grant Amount: up to $50,000 for implementing the façade and landscaping updates. • Simply Office Supplies/ KR Office Interiors – 119 N. 7th Ave. o This grant was made to assess the feasibility of assess the feasibility of converting the existing building to a mix of uses with commercial on the ground floor and residential occupying the upstairs. The grant may also be used to study rebuilding and new construction on the site. This project is in-line with the current efforts of the District and City Zoning to provide mixed-use functions near the core of Bozeman.  Technical Assistance Grant Amount: up to $7,200. 200 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Fiscal Year 2016 Annual Report and Fiscal Year 2017 Work Plan and Budget Page 4 of 10 • EZ Auto – 23 N. 7th Ave. o This Technical Assistance Grant of up to $7,200 was recently awarded to assess the feasibility of redeveloping the site. • Bar 3 Barbeque – 215 N. 7th Ave. o This Technical Assistance Grant of up to $7,200 was recently awarded to assess the feasibility of redeveloping the site, or evaluating the expansion of the existing building. 201 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Fiscal Year 2016 Annual Report and Fiscal Year 2017 Work Plan and Budget Page 5 of 10 Fiscal Year 2017 Work Plan and Budget Overview The Midtown Urban Renewal Board’s Work Plan and Budget prioritizes the creation of a number of “shovel-ready” infrastructure designs in anticipation of a significant, future, infrastructure construction bond. The rationale for this approach is threefold: First, the continuation of the lighting and streetscape project requires the donation of easements by property owners between Durston Rd. and Main St. While staff is optimistic about success in this process, it is proving to be time consuming and more easements must be acquired before construction can commence. Second, the next phase of the project promises to be much more expensive as it will include far more sidewalk construction as well as the addition of conforming ADA ramps, and street trees and tree grates, whereas previous phases mostly involved the replacement of street lights. Third, the remediation of blighted conditions in the district and its ongoing redevelopment will take many more years, while there are only five more years remaining on the district without extending the life of the district through bonding. This approach prepares several projects for construction in anticipation of a bond. 202 Bozeman Midtown Urban Renewal Board Fiscal Year 2017 Budget Scheduled Infrastructure Planning and Construction Lighting and Streetscape Project Engineering Services for Design and Construction (Main - Villard)160,000$ Right of Way Acquisition Engineer (DOWL)30,000$ Cat's Paw, Debos Pawn, Action Pawn, Recompute Lighting and Sidewalk Design 10,000$ Festival Street Design Charettes 10,000$ BMX Park Master Plan 25,000$ Telecommunications Conduit Engineering & Construction 100,000$ 5th Avenue Multi-Use Path Design 12,500$ 8th Avenue Trail Multi-Use Path Design 12,500$ Oak Street Multi-Use Path (Kmart) Construction and Design 60,000$ Oak Street Multi-Use Path (Scrubby's) Design 5,000$ Bond Counsel Dorsey & Whitney LLC Bond Counsel 30,000$ Redevelopment Planning and Facilitation Development Node Building Concepts, Property Owner Outreach, and Action Planning 50,000$ Parking Management District 40,000$ Incentive Programs Technical Assistance Grants, 4 grants up to $10,000 40,000$ N7 Rehabilitation Incentive Programs as authorized by City Commission Resolution 250,000$ District Operations Outreach and Mailing 5,000$ Midtown Website and Rebranding 10,000$ Professional Services to Support District Staff 36,000$ Special Projects Midtown Event 20,000$ Whittier School Whittier School Pre-K Playground Equipment 30,000$ Whittier Asphalt parking lot and playground improvements 25,000$ Whittier School Renovations to Pre-K SPED area 30,000$ FY 2016 Encumbered Grant Projects Midtown Tavern Patio and Landscaping 20,730$ Comfort Inn Façade and Landscaping 14,131$ Gallatin Valley Furniture Carpet One Technical Assistance 7,200$ Simply Office Technical Assistance 7,200$ EZ Auto Sales Building Technical Assistance Grant 7,200$ Bar 3 Barbeque Technical Assistance Grant 7,200$ TOTAL EXPENDITURES 1,054,661$ Estimated FY 2016 Ending Balance 968,738$ Estimated Revenues 728,013$ Estimated Total Cash FY 2017 1,696,751$ Estimated Cash minus expenditures 642,090$ 203 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Fiscal Year 2016 Annual Report and Fiscal Year 2017 Work Plan and Budget Page 6 of 10 Lighting and Streetscape Project Engineering Main St. to Villard St. The installation of new light fixtures for the corridor was identified as one of the top three priorities for District Plan Implementation in 2008. The MURB recognizes that new light fixtures will help establish a distinct identity for the corridor, define key intersections, improve vehicular and pedestrian safety and improve the aesthetic experience of the corridor. The MURB chose to proceed with engineering the streetscape for the section of N. 7th between Main St. and Villard St. Staff are only four easements away from completing right-of-way acquisition for this section and we have confidence that our negotiations on the next four will be successful. Our engineer is working with the Montana Department of Transportation on design elements that include boulevard trees, tree grates, permeable pavers, and new street lights. Durston St. to Juniper St. Remainder The MURB requests funding for completing full engineering work on the streetscape design for parcels owned by property owners who have not yet donated right-of-way easements. It is the board’s hope that an agreement with these property owners will be reached this fiscal year, so that streetscape construction can commence. Right-of-Way Acquisition Engineer The District has been very successfully utilizing the City’s contract with DOWL for a right-of-way acquisition engineer to obtain easements for the Lighting and Streetscape Project. This budget item continues that work and allows for additional time toward right-of way acquisition for multi-use path projects in other parts of the district. Telecommunications Conduit Urban Renewal Project Engineering and Construction The MURB is continuing the expansion of its fiber optic infrastructure project. The project would allow the MURB to plan more comprehensively for fiber optic infrastructure throughout the district to facilitate blight remediation by means of enhanced infrastructure that may attract new businesses and support existing businesses. The District installed conduit for lease to broadband companies in FY16 and would like to continue expansion of the system in FY17. BMX Park Master Plan The MURB is collaborating with the City Parks Department on improving the BMX Park as a significant corridor asset and as a regional attraction to draw people into the district. The goal is to create and then implement a BMX park master plan. This action has two features. First, it improves a public park as an amenity for the corridor. Second, it will function as an incentive for future infill residential development. Improvements made to the park by the District will be logged in a “parkland bank” and developers can apply against the banked improvements for their parkland dedication requirement. 204 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Fiscal Year 2016 Annual Report and Fiscal Year 2017 Work Plan and Budget Page 7 of 10 Aspen Street Festival Street This unique one block street (Aspen St., between 5th Ave. and 7th Ave.) holds potential as the gateway from the N. 7th Corridor to the soon-to-be enhanced BMX Park. With a great view of the park, the Bridger Range and the Gallatin County Fairgrounds, and with a cluster of four restaurants and bars, the area offers a pedestrian and cycling draw unlike any other part of the corridor. Multi-use Trail Expansions Oak St. Multi-Use Path Design and Construction – N. 5th Ave. to N. 7th Ave. This project involves designing and constructing a 10 foot, concrete multi-use path on the south side of Oak St. from N. 5th Ave. to N. 7th Ave. to connect the existing multi-use path along Oak St. to N. 7th. N. 5th Avenue Multi-Use Path Design – Oak St. to Tamarack St. This project involves designing a 10 foot, multi-use path in the existing dedicated 5th Street right of way from Oak St. to Tamarack St. City Staff will also explore obtaining additional right of way for the path from the adjoining property owner if it is found to be mutually beneficial to both parties. N. 8th Avenue Multi-Use Path Design – Juniper St. to Durston Rd. This project involves designing a 10 foot, multi-use path in the existing dedicated 8th Street right of way from Juniper St. to Durston Rd. Bond Counsel The MURB is designing several major public infrastructure projects including the lighting, streetscape, park, festival street, and multi-use path projects. Bonding will allow these projects to be constructed concurrently and extend the life the life of the district. Planning for a bond would start in FY 2017, with most of the work occurring in FY 2018, with the Commission considering a bond proposal in FY 2018. The requested funding amount represents the entirety of the anticipated bond counsel cost from preliminary work to final bonding. Development Node Building Concepts, Property Owner Outreach, and Action Planning The Midtown Corridor’s length dictates that pedestrian oriented development will cluster around a number of distinct nodes within the district. This project involves engaging with property owners about the potential for economically beneficial and collaborative development in these nodes. Deliverables for the project would include, at minimum, the following elements: • Present a refined list of catalyst projects and investments and a schematic vision for these projects. These projects should be organized around well-articulated development nodes. 205 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Fiscal Year 2016 Annual Report and Fiscal Year 2017 Work Plan and Budget Page 8 of 10 • Hold community engagement meeting in Bozeman with urban renewal board members and city staff to review proposals, obtain buy-in, create project evaluation criteria, and propose project- specific incentive strategies. • Prepare a financing schedule to determine TIF cash flow to implement projects. • Draft list of project priorities and preliminary budget based on project concepts. • Finalize draft priorities, budgets, and concepts • Meet with property owners, urban renewal board, and key City staff to finalize the action plan Develop a Parking Management District for Midtown Based on Identified Development Nodes The adequate provision of parking is an important consideration for development. Regulations that require more parking than is actually necessary for a given development affects project feasibility. Additionally, parking is a major use of land that is less economically productive than many other uses. Given the emphasis that the Midtown Urban Renewal Plan places on promoting unified human scale urban design (Goal 4) and supporting compatible urban density mixed land uses (Goal 5), it is essential to craft parking minimums that support these objectives without allocating more land to parking, rather than useable development, than is necessary. This program contemplates the following deliverables: • Inventory on-street parking in surrounding neighborhoods to establish a baseline for neighborhood utilization of existing parking assets. Discuss options for mitigating possible commercial overflow into existing neighborhoods. • Analyze parking in the proposed development nodes and the impact of existing parking standards on the feasibility of these proposals. • Use strategic sampling to determine actual use of comparable and relevant commercial parking in Bozeman to create “right-sized” minimum parking minimum standards for Bozeman’s Midtown and/or the B2-M and R5 zoning districts. • Draft suggested development code changes for parking based on the desire to incentivize compatible urban density mixed-use residential and commercial development. • Propose a district-wide strategy for locating and developing public and/or shared private parking facilities. Redevelopment Incentive Programs Technical Assistance Grants This program is to provide technical assistance funding to encourage developers to build on parcels along the N. 7th Avenue corridor or rehabilitate existing structures. It recognizes the complexities of redeveloping parcels which have existing substandard buildings and infrastructure; it was created to offset the costs of those complexities with grants for those proposing work which eliminates blight and advances the implementation of the District Plan. The program was approved by Resolution 4307 and is administered by the MURB. This year, the board is proposing raising the maximum grant amount from $7,200 to $10,000. 206 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Fiscal Year 2016 Annual Report and Fiscal Year 2017 Work Plan and Budget Page 9 of 10 Direct Incentive Programs For the past several years, the MURB has administered the N7 Rehabilitation Grant program, which incentivizes improvements to sites and façades of existing structures to facilitate blight remediation. The existing program has been a component of several successful and worthy projects in recent years. Nevertheless the board and staff are concerned that the program (15% of eligible project costs up to $50,000) is too small to actually incentivize projects that were not already feasible. In addition, by rehabilitating existing building forms and site designs, the program is actually preserving development patterns that are counter the land use goals of the district. Over the next few months, the board plans to create new and revised incentive programs for authorization by the City Commission. The programs will be structured to facilitate competition between projects and will draw from this single pool of funding. Awards will be based on the quality of projects and their support of the Midtown Urban Renewal Plan. District Operations Outreach and Mailing The Board has requested money for public noticing and outreach activities in the District. The purpose of these outreach activities is to inform and engage property owners and the public in the implementation of the Midtown Urban Renewal Plan. Midtown Website and Rebranding For several years, the district has operated the nsurb.net site to promote the district and the urban renewal program. With the change in name to the Midtown Urban Renewal District, the board needs a new brand identity and website to communicate effectively with property owners and the public and “to disseminate blight clearance and urban renewal information.” Professional Services to Support District Staff The Board needs City staff assistance with District Plan implementation. Additionally, City staff will need to contract for professional services to assist with district management and implementation of the work plan and budget. Midtown Event The MURB indicated a strong desire to host an event in Midtown that would attract people into the area and highlight the new identity of the district. The board would work to facilitate the event over the coming months and likely hire a professional event planner to coordinate the details. Whittier School Projects Whittier School was included in the original urban renewal district. The administration of Bozeman School District #7 requested four public infrastructure improvement projects at the school. The MURB supported the inclusion of three of the four projects in its work plan and budget. The school district funding request with descriptions of the projects is attached to this document. 207 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Fiscal Year 2016 Annual Report and Fiscal Year 2017 Work Plan and Budget Page 10 of 10 April 28, 2016 North 7th Avenue TIF Board: Following is a list of projects that we would like the North 7th Avenue TIF Board to consider funding in your 2016-17 budget: Pre-K Playground Equipment The School District started a Running Start Kindergarten Program for 4 year olds at Whittier School in January 2015. In addition, one of two Special Education Pre-School classes will be moved to Whittier next year. The playground equipment that is currently on the playground is too big for this age group of students. This request is for preparation, purchase and installation of age appropriate playground equipment in a separate area for these younger children. Like all of the Bozeman School playgrounds, Whittier’s playground is open to the public when not in use by the school, therefore, these improvements will benefit our entire community. Budget: $30,000 Asphalt parking lot and playground improvements Needed maintenance of both the off-site parking lot and the existing playground to enhance durability and safety. This will consist of patching and filling in cracks, a slurry coat, and re-striping all required pavement markings. Budget: $25,000 Renovations to the Pre-K SPED area Shifts within the SPED Pre-K program have resulted in an increased need for completed and adequate space at Whittier Elementary. Proposed improvements incorporate renovations to facilitate this function with the existing SPED program. Added improvements include better circulation between activities and classroom features. Improved instruction components will include additional whiteboards and teaching aides. Budget $30,000 Horizontal Climbing wall in the gym Provide an alternative play activity in the gymnasium area. Climbing walls are becoming increasingly popular and are already in-place at Longfellow, Irving, and Hyalite Elementary Schools. There is a potential cost share with the Whittier Parent Advisory Council for this item. Budget: $15,000 Thank you for your consideration. Respectfully, Steven D Johnson, Deputy Superintendent Operations Steven D. Johnson Deputy Superintendent Operations Bozeman Public Schools 404 West Main, P.O. Box 520 208 N 7TH AVE W OAK ST N19THAVEW MAIN ST INTERSTATE90HWY N ROUSE AVE BAXTERLN W COLLEGE ST DURSTON RD E MAIN ST S 11TH AVE S 19TH AVE SCHURCHAVES WILLSON AVE N 11TH AVE W PEACH ST FRO N T A G ERDEOAKST BRIDGERDR E PEACH ST N 7TH AVE INTERSTATE90HWY 0 ½1¼Miles Legend Northeast Neighborhood Urban Renewal District Midtown Urban Renewal District Mandeville Farms Tax Increment District Downtown Tax Increment District South Bozeman Technology District ´ Revised: 5/18/2016 This map was created by theCity of BozemanGIS DepartmentIntended for Planning purposes only. Midtown TIF District Boundaries 209