HomeMy WebLinkAbout11-21-16 CC Mtg - A1. Resolution 4732, NEURD Bonding Hearing on 12-19-2016
Commission Memorandum REPORT TO: Honorable Mayor and City Commission FROM: Brit Fontenot, Director of Economic Development SUBJECT: Resolution 4732 Calling for a Public Hearing to Approve Certain Public Infrastructure Projects in the Northeast Urban Renewal District as Urban Renewal District as Urban Renewal Projects and to Finance the Projects through the Issuance of Tax Increment Urban Renewal Bonds; and Making a Reimbursement Declaration in the Event that Tax-Exempt Bond Proceeds Reimburse Original Expenditures to the City MEETING DATE: November 21, 2016 AGENDA ITEM TYPE: Action RECOMMENDATION: Approve Resolution 4732 directing staff to return to the Commission on December 19, 2016 for a public hearing on the approval of the proposed projects and the City’s proposed issuance of the bonds. (Attachment 1)
RECOMMENDED MOTION AND VOTE: I move to approve Resolution 4732 directing staff to return to the Commission on December 19, 2016 for a public hearing on the approval of the proposed projects and the City’s proposed issuance of the bonds.
BACKGROUND: The Northeast Urban Renewal District (the “District”) was created, and the District Plan (the “Plan”) adopted, in 2005. (Attachment 2) The Plan’s purpose is to ensure the vitality of the District for generations to come and make the District an area in which its citizens can take “exceptional pride”. Additionally, the Plan envisions a mix of uses, diversity in housing, businesses and amenities while maintaining its unique ambiance and character. Principles guiding the management of the District by the District Board (the “Board”) include: 1) Ensure the health, safety and security of the District; 2) Balance commerce and livability in the District within the mixed-use framework; 3) Honor the unique character and vitality of the District; 4) Public open space is essential to a health and appealing urban
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environment; 5) The costs of the projects and programs shall be weighted against the benefits to the District; 6) Public property shall not be acquired for other private use through the eminent domain process in the implementation of any aspect of this plan; 7) The City shall not limit its vision for the District improvements to monies available solely through TIF finding; 8) Projects shall consider impacts on adjacent neighborhoods; 9) the City shall consider the impact on the District of all projects undertaken outside of the District. The current Board consists of both voting and non-voting members. Voting members include: Erik Nelson, Chair; Jeanne Wesley-Wiese, Vice-Chair; Robert Pavlic; Daniel Doehring; and Bobbie Clem. Non-voting members include John Usher and Tom Noble. On June 13, 2016 Board Chair Tom Noble presented the FY17 District Workplan and Budget (Attachment 3) In addition to contributing to the reconstruction effort on North Wallace Avenue, the Board committed to pursuing efforts to bond several construction projects in the District. At that time, the Board prioritized seven (7) projects: 1) East Tamarack Street reconstruction; 2) East Peach Street reconstruction; 3) Pedestrian R/R crossing upgrades at North Wallace Avenue; 4) East Aspen Street/Pedestrian Bridge; 5) Alternative Front Street reconstruction; 6) Alternative North Ida Avenue reconstruction; and 7) Alternative Quiet Zone Feasibility Study. Additionally, the approved FY 17 budget included cost estimated for bonding the district, both counsel services and payment as well as allocating a reserve fund. Since the District budget was approved the bonding proposal has been refined. First, the pedestrian and railroad crossing upgrade was included as part of the separate North Wallace Reconstruction project and paid for with a combination of TIF funds and funds from GVLT and the Parks, Recreation and Cemetery Department. Next, it was determined that the alternative quiet zone and feasibility study project was an ineligible expense for a bond. Finally, the remaining projects were re-prioritized in the following order: 1) reconstruction of East Tamarack Street; 2) reconstruction of East Peach Street; 3) reconstruction of North Ida Avenue; 4) reconstruction of Front Street; and 5) reconstruction of East Aspen Street and construction of a pedestrian bridge to cross Bozeman Creek and connect to the existing trail. (Attachment 4) On October 4, 2016 the Board passed Resolution 2017 – 01 identifying and prioritizing the aforementioned projects. (Attachment 5) Cost estimates for the proposed bonded projects were prepared by the Board’s consulting engineering firm KLJ and outlined in an October 12, 2016 memorandum to the Board (Attachment 6) On November 1, 2016 the Board again discussed the prioritization of the projects and determined they should remain in the order approved at the October 4 meeting and recommended by Board Resolution 2017 – 01. (Attachment 7) In an updated October 11, 2016 memo to
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staff, Community Development Services of Montana outlined a complete schedule and process for District bonding the proposed projects. (Attachment 8) It is the Board’s objective to fund District infrastructure projects that have the most positive impact in the district while furthering the goals of the 2005 District Plan, with the funds available from the bond. The Board has prioritized five (5) projects for potential completion with bond proceeds with a total estimated value of $1,976,700. The Board acknowledges that the estimated maximum bonding capacity is $1,446,778, less than the estimated total for all the prioritized projects and recognizes that not all of the prioritized projects will be funded. With the debt coverage requirement estimated at 130% and a proposed term of 25 years at a 5% interest rate, the annual debt service on the $1,446,778 maximum bond amount is estimated at $102,021 with estimated excess cash per year calculated at $30,606 or $765,159 after 25 years. (Attachment 9) If the incremental value of District properties increases, it will be in addition to the estimated $30,606 excess cash per year. FISCAL EFFECTS: The immediate fiscal effect of this resolution is to allow the District to begin spending dollars on the approved projects that can be reimbursed by the eventual bond sale. We estimate approximately $140,000 for design on the East Tamarack and East Peach Street projects. This is approximately 80% of the engineering and administration costs for these two projects. Upon issuance of the bonds, the city will receive an estimated $1.45 Million to finish the projects. Because the entire listing of projects exceeds our estimated bond proceeds, we may not be able to complete all the projects. Projects will be completed in priority order. The bonds will be re-paid according to the terms of the bond agreement. We estimate the bond agreement to require semi-annual payments over a 25-year term at approximately 5% annual interest. This would require approximately $102,000 in annual principal and interest payments from the District’s tax increment revenues. Given the size of the current annual increment, approximately $30,600 of increment would remain for other district activities. (Attachment 9) Without issuing bonds, the district will sunset in 2020. By issuing bonds, the life of the district is extended until the bond term expires and the district will continue to collect revenues that can be used for urban renewal activities.
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Estimated Bonding Capacity:
Bonding Estimates: Coverage Requirement 130% Amount for Annual Debt Service $ 102,021 Interest Rate of Bonds 5.00% Term in Years 25 ESTIMATED PRINCIPAL ABLE TO BE ISSUED $ 1,446,778 Operations: District continues on for added 25 years, with excess cash going to district - Initial excess cash per year: $ 30,606 - Initial excess cash per year x 25 years $ 765,159
Estimated Engineering Costs for Prioritized Projects:
ATTACHMENTS:
1) Resolution 4732; 2) 2005 Northeast Urban Renewal District Plan; 3) FY17 NEURD Workplan and Budget; 4) October 4, 2016 NEURD Board Meeting Minutes; 5) October 4, 2016 NEURD Board Resolution 2017-01; 6) October 12, 2016 KLJ Memo RE: Project Cost Estimates for Bonding; 7) November 1, 2016 NEURD Board Meeting Minutes;
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8) October 11, 2016 Memo from Community Development Services of Montana RE: Schedule/Steps for the NE URD Bond Issue; and 9) September 8, 2016 Estimate of Northeast TIF Bonding Capacity.
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Page 1 of 6
RESOLUTION NO. 4732
RESOLUTION CALLING A PUBLIC HEARING TO APPROVE CERTAIN
PUBLIC INFRASTRUCTURE PROJECTS IN THE NORTHEAST URBAN RENEWAL DISTRICT AS URBAN RENEWAL PROJECTS AND TO FINANCE THE PROJECTS THROUGH THE ISSUANCE OF TAX INCREMENT URBAN RENEWAL BONDS; AND MAKING A
REIMBURSEMENT DECLARATION IN THE EVENT THAT TAX-
EXEMPT BOND PROCEEDS REIMBURSE ORIGINAL EXPENDITURES OF THE CITY
BE IT RESOLVED by the City Commission (the “Commission”) of the City of Bozeman,
Montana (the “City”), as follows:
Section 1. Recitals.
1.01. Pursuant to Resolution No. 3835, adopted on August 15, 2005, the Commission determined that blighted areas existed within the boundaries of the City and appointed an urban renewal planning committee to prepare an urban renewal plan.
1.02. The Commission, pursuant to Ordinance No. 1655 (the “Ordinance”), adopted on
November 28, 2005, created the Northeast Urban Renewal District (the “District”) and approved
the Northeast Urban Renewal District Plan (the “Plan”) for the District containing a tax increment financing provision, all as set forth in the Ordinance and the Plan.
1.03. Pursuant to the Plan, tax increment financing is to be used to further the
implementation goals in the Plan, which include ensuring the health, safety and security of the
District by repairing or replacing outdated or insufficient infrastructure and by incorporating
sidewalks, crosswalks, bike lanes and trails in the design for construction or reconstruction of streets and roadways.
1.04. In addition, the Plan created the Northeast Urban Renewal Board (the “Board”) to
exercise the powers of an urban renewal agency under the Act with respect to the District and to
implement the Plan. Among other things, the Board is required to prepare an annual work program
and budget for projects in the District, which program and budget are subject to review and approval by the Commission.
Section 2. The Projects. On October 4, 2016, the Board adopted Resolution No. 2017-
01, in which it prioritized the following projects, which were also identified in the Board’s annual
work plan for fiscal year 2017, in the following listed order of importance:
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• Reconstruction of East Tamarack Street (the “East Tamarack Project”);
• Reconstruction of East Peach Street (the “East Peach Street Project”);
• Reconstruction of North Ida Avenue (the “North Ida Avenue Project”);
• Reconstruction of Front Street (the “Front Street Project”); and
• Reconstruction of East Aspen Street and construction of a pedestrian bridge to cross
Bozeman Creek and connect to the existing trail on the other side (the “East Aspen Street Project” and, collectively with the projects identified above, the “Projects”).
The Board has worked with Kadrmas, Lee & Jackson, Inc. (the “Engineer”) to determine
approximate engineering and construction costs for the Projects. The Engineer estimates that
engineering and construction of the East Tamarack Project will cost approximately $582,500; the
East Peach Street Project will cost approximately $743,800; the North Ida Avenue Project will cost approximately $290,500; the Front Street Project will cost approximately $193,700 and the
East Aspen Street Project will cost approximately $166,200, for a combined engineering and
construction cost of the Projects of $1,976,700. Costs of issuance of the Bonds and other costs
associated with the sale and issuance of the Bonds are not included in the foregoing costs.
The City’s Administrative Services Director has determined that the City can issue approximately $1,446,000 in principal amount of tax increment revenue bonds (the “Bonds”),
based on the available tax increment revenues of the District, as calculated by using current
information from the Department of Revenue of the State of Montana.
The Projects are contemplated by and within the scope of the Plan, and are eligible for tax
increment financing under the Act. The Board has, by its Resolution No. 2017-01, requested that the Commission approve the Projects as urban renewal projects under the Act and issue tax
increment revenue bonds, payable from tax increment revenues of the District, to finance all or a
portion of the Projects, as the bonding capacity of the District allows. The estimated maximum
principal amount of Bonds the District can support ($1,446,000) is not sufficient to finance in full
the costs of all of the Projects, recognizing that future taxable values of taxable property in the District may allow the Bonds to be issued in a different principal amount. If the Projects are
approved as urban renewal projects, the Commission will direct the Board to undertake the Projects
only to the extent that funding is available to complete such Projects, from proceeds of the Bonds
or otherwise.
Section 3. Preliminary Findings. The Commission hereby finds, as a preliminary matter, with respect to the Projects as follows:
a. no persons will be displaced from their housing by the Projects;
b. the Plan and the Projects conform to the comprehensive plan or parts thereof
for the City as a whole;
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c. the Plan and the Projects will afford maximum opportunity, consistent with
the needs of the City as a whole, for the rehabilitation or redevelopment of the
District by private enterprise;
d. the issuance of the Bonds in the estimated principal amount of $1,446,000 is adequate to cover costs of a portion of the Projects; because the Commission will
direct the Board to undertake the Projects only to the extent that funding is available
to complete such Projects, whether from proceeds of the Bonds or otherwise, there
is expected to be a sound and adequate financial program for the financing of such
Projects; and
e. the Projects constitute urban renewal projects within the meaning of the Act
and the Plan.
Section 4. Public Hearing. A public hearing is hereby called and shall be held on
December 19, 2016 at 6:00 p.m. in the City Commission Room at City Hall, 121 N. Rouse Avenue,
Bozeman, Montana, on the approval of the Projects and the City’s proposed issue of the Bonds. The Bonds will be payable from the tax increment collected within the District.
Section 5. Notice. Notice of the public hearing shall be published in the Bozeman
Daily Chronicle on December 4 and December 11, 2016, in substantially the form attached
as Exhibit A hereto (which is incorporated by reference and made a part hereof).
Section 6. Reimbursement Expenditures.
6.1. Regulations. The United States Department of Treasury has promulgated regulations
governing the use of proceeds of tax-exempt bonds, all or a portion of which are to be used to
reimburse the City for project expenditures paid by the City prior to the date of issuance of such
bonds. Those regulations (Treasury Regulations, Section 1.150-2) (the “Regulations”) require that
the City adopt a statement of official intent to reimburse an original expenditure not later than 60 days after payment of the original expenditure. The Regulations also generally require that the
bonds be issued and the reimbursement allocation made from the proceeds of the bonds within 18
months (or three years, if the reimbursement bond issue qualifies for the “small issuer” exception
from the arbitrage rebate requirement) after the later of (i) the date the expenditure is paid or (ii)
the date the project is placed in service or abandoned, but (unless the issue qualifies for the “small issuer” exception from the arbitrage rebate requirement) in no event more than three years after
the date the expenditure is paid. The Regulations generally permit reimbursement of capital
expenditures and costs of issuance of the bonds.
6.2. Prior Expenditures. Other than (i) expenditures to be paid or reimbursed from sources
other than the Bonds, (ii) expenditures constituting preliminary expenditures within the meaning of Section 1.150-2(f)(2) of the Regulations, or (iii) expenditures in a “de minimus” amount (as
defined in Section 1.150-2(f)(1) of the Regulations), no expenditures for the Projects have been
paid by the City before the date 60 days before the date of adoption of this Resolution.
6.3. Declaration of Intent. The City reasonably expects to reimburse the expenditures
made for costs of the Projects out of the proceeds of Bonds in an estimated maximum aggregate principal amount of $1,446,000 after the date of payment of all or a portion of the costs of the
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Projects. All reimbursed expenditures shall be capital expenditures, a cost of issuance of the Bonds
or other expenditures eligible for reimbursement under Section 1.150-2(d)(3) of the Regulations.
6.4. Budgetary Matters. As of the date hereof, there are no City funds reserved, allocated
on a long-term basis or otherwise set aside (or reasonably expected to be reserved, allocated on a long-term basis or otherwise set aside) to provide permanent financing for the expenditures related to the Projects, other than pursuant to the issuance of the Bonds. The statement of intent contained
in this Resolution, therefore, is determined to be consistent with the City’s budgetary and financial
circumstances as they exist or are reasonably foreseeable on the date hereof.
6.5. Reimbursement Allocations. The City’s Administrative Services Director shall be responsible for making the “reimbursement allocations” described in the Regulations, being
generally the transfer of the appropriate amount of proceeds of the Bonds to reimburse the source
of temporary financing used by the City to make prior payment of the costs of the Projects. Each
allocation shall be evidenced by an entry on the official books and records of the City maintained
for the Bonds or the Projects and shall specifically identify the actual original expenditure being reimbursed.
PASSED AND APPROVED by the City Commission of the City of Bozeman, Montana,
this 21st day of November, 2016.
CARSON TAYLOR Mayor
ATTEST:
ROBIN CROUGH, MPA City Clerk
APPROVED AS TO FORM:
GREG SULLIVAN
City Attorney
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A-1
EXHIBIT A
NOTICE OF PUBLIC HEARING TO APPROVE CERTAIN PUBLIC
INFRASTRUCTURE PROJECTS IN THE NORTHEAST URBAN
RENEWAL DISTRICT AS URBAN RENEWAL PROJECTS AND TO FINANCE THE PROJECTS THROUGH THE ISSUANCE OF TAX INCREMENT REVENUE BONDS
NOTICE IS HEREBY GIVEN that the City Commission (the “Commission”) of the City
of Bozeman, Montana (the “City”) will hold a public hearing on December 19, 2016 at 6:00 p.m.
in the City Commission Room at City Hall, 121 N. Rouse Avenue, Bozeman, Montana on the approval of the following projects in the Northeast Urban Renewal District as urban renewal projects: reconstruction of East Tamarack Street; reconstruction of East Peach Street;
reconstruction of North Ida Avenue; reconstruction of Front Street; and reconstruction of East
Aspen Street and construction of a pedestrian bridge to cross Bozeman Creek and connect to the
existing trail on the other side (collectively, the “Projects”). It is proposed that the City will issue and sell its urban renewal tax increment revenue bonds (the “Bonds”) in an estimated principal amount of $1,446,000, to fund all or a portion of the Projects. The Commission will instruct the
Northeast Urban Renewal Board to issue the Bonds only up to an amount for which sufficient tax
increment is estimated to be available to repay the Bonds as and when due.
Any interested persons may appear and will be heard or may file written comments with the City Clerk prior to such hearing.
Dated: November 28, 2016.
ROBIN CROUGH, MPA City Clerk
Publication Dates: December 4, 2016
December 11, 2016
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CERTIFICATE AS TO RESOLUTION AND ADOPTING VOTE
I, the undersigned, being the duly qualified and acting recording officer of the City of
Bozeman, Montana (the “City”), hereby certify that the attached resolution is a true copy of a
Resolution No. 4732 entitled: “RESOLUTION CALLING A PUBLIC HEARING TO APPROVE
CERTAIN PUBLIC INFRASTRUCTURE PROJECTS IN THE NORTHEAST URBAN
RENEWAL DISTRICT AS URBAN RENEWAL PROJECTS AND TO FINANCE THE
PROJECTS THROUGH THE ISSUANCE OF TAX INCREMENT URBAN RENEWAL
BONDS; AND MAKING A REIMBURSEMENT DECLARATION IN THE EVENT THAT
TAX-EXEMPT BOND PROCEEDS REIMBURSE ORIGINAL EXPENDITURES OF THE
CITY” (the “Resolution”), on file in the original records of the City in my legal custody; that the
Resolution was duly adopted by the City Commission of the City at a regular meeting on
November 21, 2016, and that the meeting was duly held by the City Commission and was attended
throughout by a quorum, pursuant to call and notice of such meeting given as required by law; and
that the Resolution has not as of the date hereof been amended or repealed.
I further certify that, upon vote being taken on the Resolution at said meeting, the following
Commission members voted in favor thereof:
; voted against the same:
; abstained from voting thereon: ; or
were absent: .
WITNESS my hand and seal officially this 22nd day of November, 2016.
(SEAL)
ROBIN CROUGH, MPA City Clerk
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Commission Memorandum
REPORT TO: Honorable Mayor and City Commission
FROM: Brit Fontenot, Economic Development Director
SUBJECT: Northeast Urban Renewal Board FY 17 Work Plan and Budget
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 proposed FY 17 Northeast Urban Renewal Board (NE URB) Work Plan and Budget. If approved by the City Commission, the NE URB FY 17 Work Plan and Budget Proposal will be adopted as part of the City of Bozeman’s FY 17 Budget.
BACKGROUND: At its regular meeting held on June 7, 2016 the Northeast Urban Renewal Board approved the attached FY 17 work plan and budget. (Attachments 1 & 2) The total amount of budgeted funds for FY 17 is $2,014,000 (including carry over from previous years and not including the undesignated reserve). FY 17 Proposed Budget Summary: Trails Maintenance $5,000 Infrastructure $1,598,700 Public Arts Program $5,000 Depot Rehabilitation $1,000 Anticipated Bonding Costs $30,000 Staff Support $10,000 Administrative Services $3,000 Bond Repayment $55,000 Project Engineering $60,000 Bond Reserve $110,244
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Undesignated Reserve $136,056 Budget Total $2,014,000 The NURB proposes a work plan and budget and submits a report on an annual basis per Section 7-15-4237 of the 2009 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. (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. UNRESOLVED ISSUES: The current value of one mill is $86,564. Estimates indicate an approximate 2% increase in taxable values during reappraisal in 2017 which will have an impact on Districts around the City. Commercial and residential property reappraisals have shifted from a six-year to a two-year reappraisal cycle.
FISCAL EFFECTS: The current fund balance, as of May 26, 2016 is $399,828.72. (Attachment 3) If approved by the City Commission, the NURB FY 17 Work Plan and Budget Proposal will be adopted as part of the City of Bozeman’s Annual Budget adoption process. The district is preparing to bond for the eligible projects. The Board is working with CDS of Montana to assist in that effort. A proposed bonding schedule and map are included as Attachments 4 & 5. Attachments: 1. NURB FY 17 Proposed Work Plan; 2. NURB FY 17 Proposed Budget;
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3. Northeast Urban Renewal District Revenues and Expenditures as of 5-26-16 4. May 16, 2016 Bond Schedule Memo prepared by CDS of Montana; and 5. Map of the NE URD.
Report compiled on: June 3 and June 7, 2016
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Northeast Urban Renewal Board Annual Work Plan and Budget FY17 1
59771
NORTHEAST URBAN RENEWAL BOARD BUDGET FY 2017 PROPOSAL
TO THE BOZEMAN CITY COMMISSION In 2005, the Bozeman City Commission adopted Ordinance No. 1655 which formally enacted the
Northeast Urban Renewal Plan. The stated mission of the plan and general goals are as follows:
DISTRICT PLAN MISSION/VISION “This Plan is the City’s response to remedy the conditions of blight found in the August 2005 [Blight]
Report. The Plan also addresses other issues important to the District. The Plan’s purpose is to ensure
the vitality of the Northeast Urban Renewal District (NURD) the vitality of the NURD for generations to come and to make the NURD an area in which its citizens can take exceptional pride. The Plan envisions a mixed use neighborhood that is user friendly, safe, secure and healthy. While this Plan envisions a District with diversity of housing businesses and amenities, it intends to maintain the
unique ambiance and historic character of the District”.
Nine principles were developed for the plan. Each of the principles has one or more goals associated with the plan, some of which specifically relate to this work plan while others represent general objectives and directives. The Northeast Urban Renewal Board (NURB) goals are as follows:
GENERAL GOALS:
Outdated or insufficient infrastructure should be repaired, replaced, or otherwise improved.
Provide public utilities to the area efficiently in ways that are not visually or physically
obtrusive.
Encourage a land use pattern that facilitates all modes of transportation – vehicular,
bicycle, pedestrian, mass transit, and commercial – for safe, efficient and convenient access for residential, commercial, and industrial uses.
Harmonize commercial and industrial development with residential quality of life.
New structures should be designed and built keeping in mind the public values of
durability, flexibility, and simplicity. Thoughtful consideration of design, materials, and
massing in the construction of new private buildings will add strength and character to the built environment. To the degree that the private sector can be influenced by a public partner in development, the community ought to strongly encourage excellence
in urban design as a basis of partnership.
Promote sustainable building practices and design within the district
Procure new land for park and open space
Improve landscaping in existing public spaces
Neither the City of Bozeman nor any of its subdivisions shall use eminent domain to
take private property for private use in the implementation of an urban renewal project
or similar redevelopment plan.
Encourage the City to help ensure the success of the Northeast Urban Renewal Plan by giving a high priority to the Northeast District in its capital improvements plan.
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Northeast Urban Renewal Board Annual Work Plan and Budget FY17 2
Work with neighborhoods and businesses to ensure actions taken in the district are
compatible with adjacent developed areas.
Work with the City to ensure actions taken outside of the District are compatible with projects inside of the District
BACKGROUND
In 2010, the Northeast Urban Renewal Board began implementing plans and projects reflecting their
three funding priorities: 1) Parks, Trails and Greenspace; 2) Infrastructure and 3) Neighborhood Development Plan.
2016 AT-A-GLANCE
In FY 2016, the Board continued to work on its priorities. While the Board, with the assistance of
Morrison-Maierle, had previously identified the elements to be included in the final special design standards for East Peach Street and East Tamarack Street/Front Street/North Ida Avenue within the
district boundaries, the plans have not yet been completed or adopted by the City Commission. The
next step is to get those documents finalized and adopted. The Board has expressed its intent to
issue bonds to accomplish those street improvements once all of the approval processes have been
completed and has begun the initial steps in the bonding process. The Board recognized the need to retain a consulting engineer to assist in moving projects forward in a more timely manner and, after
soliciting proposals and interviewing firms, retained KLJ Engineering.
The only street improvement project that has been moving forward through the design process is
North Wallace Avenue because that was identified by City staff as one of the community’s highest priorities. That project has been a top priority for staff and the consulting engineer, which has
caused the Board’s high priority projects to languish. The North Wallace Avenue street
improvements are being bid this spring, with work to be undertaken as soon as possible and
completed in the fall.
This fiscal year, the Board was approached by Gallatin Valley Land Trust (GVLT) about providing
some funding for the Front Street trail, which is to extend from North Rouse Avenue to North
Wallace Avenue. The Board recognized the importance of this trail connection, even though only
the southeasternmost end of it actually lies within the district. As a result, the Board committed the
monies needed to complete the fundraising portion of the project.
The Board continued to demonstrate its commitment to preserving the District’s historic character
by monitoring any proposals that might impact historic properties, including any potential for
preservation and possible re-use of the Depot. The Board is vigilant in monitoring new proposed
development within the District, to ensure its compatibility with the historic mixed use character of the area.
MOVING FORWARD – FY2017
The Board continues to support opportunities to work with Montana Rail Link and Burlington
Northern Santa Fe on preservation and rehabilitation projects for the passenger depot.
The Board has also agreed to commit monies to the North Wallace Avenue street improvements
completed under a special improvement district. This action will result in tax increment financing
monies being used to pay what would have been special improvement district assessments for those
properties lying within this district and fronting along North Wallace Avenue.
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Northeast Urban Renewal Board Annual Work Plan and Budget FY17 3
The Board plans to actively pursue the issuance of bonds to fund construction of several
infrastructure projects, including East Tamarack Street and East Peach Street improvements, in accordance with the special design standards once they are adopted.
Since the Board has decided to pursue the issuance of bonds, the work plan and budget for this
upcoming year are significantly different from those of past years, with several projects being
removed from the list.
The Board has specifically designated the following projects as urban renewal projects n the
following ranked order of priority:
1. East Tamarack Street reconstruction
2. East Peach Street reconstruction 3. Pedestrian R/R crossing upgrades at North Wallace Avenue
4. East Aspen Street / Pedestrian Bridge
5. Alternative Front Street reconstruction
6. Alternative North Ida Avenue reconstruction
7. Alternative Quiet Zone Feasibility Study
Furthermore, the Board has pledged to designate future annual tax increment to tax increment
urban renewal revenue bonds authorized by the Bozeman City Commission.
NORTHEAST URBAN RENEWAL PROJECTS INFRASTRUCTURE
Poor pedestrian connectivity within the District is well documented. Lack of street improvements
including missing curb, gutter, pavement and sidewalks creates an unwelcoming and potentially unsafe environment for pedestrians and bicyclists. A lack of stormwater drainage facilities leads
to the ponding of water in public rights-of-way, encouraging pedestrians to walk in the street and
emphasizing the need for street improvements. The District has a historic mix of light
manufacturing and residential uses creating a more urban environment on the streets, especially
during business hours. Modest improvements to pedestrian facilities to create safer more welcoming routes for pedestrians will reduce conflict between users. The lack of street
delineation/improvements and stormwater facilities has caused an unknown number of
individuals to use some sections of the District as dumping grounds for unwanted appliances and
furniture. Street improvements coupled with improvements to trails and parks and the
landscaping of public spaces will improve conditions for pedestrians and bicyclists and reduce, if not eliminate, dumping in the public right-of-way.
Making improvements to sidewalks on unimproved streets comes with some difficulty especially
if elevation differences are present across the width of the right-of-way and if a need to improve
stormwater drainage is warranted as well. What seems like a rather simple project turns into a large scale street improvement project. Without additional information, moving forward on these
improvements is difficult, so survey and design is the first step. Regarding design, the Board
recognizes that creative solutions are needed to enhance the public right-of-way for two very
different user types in the District. In support of improvements to these streets, the Board has
allocated a portion of the budget to the following deficient street sections in the District:
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Northeast Urban Renewal Board Annual Work Plan and Budget FY17 4
East Peach Street – Sidewalks, Storm Water control, Landscaping
Construction $ 387,400 Initial survey and the design for East Peach Street improvements have been completed. The
Board approved the design in November 2011. City advisory boards have reviewed the design,
and the Commission has approved the design, but it has not yet been adopted by ordinance. It
has also been determined that the design has not been fully completed and the plans and
specifications have not yet been compiled for going to bid on this project. The Board has decided to fund the engineering needed to complete the design and bidding process from its TIF funds
this year, in anticipation that the final plans and construction documents will be prepared this
year, with bidding to occur in late Fall or early Winter 2016 and construction to be undertaken in
Spring 2017.
The Board has chosen to issue tax increment financing bonds to cover the costs of constructing
several infrastructure improvements over the next couple construction seasons, including this
one.
East Tamarack Street $ 385,900 Morrison-Maierle has completed the initial survey and design work for special street standards
for East Tamarack Street, Front Street and North Ida Avenue; and this Board approved those
designs at its September 2014 meeting. The final design is to be prepared and submitted to
advisory boards for comment and then to the Commission for its action. After the Commission
approves the design standards for these roadways, the next step will be preparation of an ordinance that adopts the special design standards for these roadways and those for East Peach
Street.
The Board has now chosen to split this project into different pieces, with the East Tamarack
Street improvements selected as its top priority project. As a result, this section pertains to the East Tamarack Street improvements only.
The Board has decided to fund the engineering needed to complete the design and bidding
process from its TIF funds this year, in anticipation that the final plans and construction
documents will be prepared this year, with bidding to occur in late Fall or early Winter 2016 and construction to be undertaken in Spring 2017.
The Board has chosen to issue tax increment financing bonds to cover the costs of constructing
several infrastructure improvements over the next couple construction seasons, including this
one.
Front Street/East Aspen Street $ 193,700
A significant amount of design work is still needed for the improvements to Front Street and East
Aspen Street adjacent to depot park, particularly with the storm drainage issues near the depot.
The Board has budgeted some TIF monies this year for continued work on the designs for these street improvements. These are listed as low priority projects for the use of bond monies and will be constructed only if monies are available after the other top priority projects have been
completed.
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Northeast Urban Renewal Board Annual Work Plan and Budget FY17 5
North Ida Avenue $ 290,500
A significant amount of design work is still needed for the improvements to North Ida Avenue,
due in large part to the narrow right-of-way available, the proximity of buildings to the right-of-way line, and storm drainage issues. The Board has budgeted some TIF monies this year for continued work on the design for these street improvements. This is listed as the lowest priority
project for the use of bond monies and will be constructed only if monies are available after the
other top priority projects have been completed.
North Wallace Avenue Construction $ 100,000
The North Wallace Avenue design has been completed and a special improvement district created
to cover the costs that the adjacent property owners are to cover. Since this project is subject to
the City’s reconstruction process, the reconstruction fund will cover 85 percent of the basic costs
while the special improvement district will fund 15 percent of the basic costs and 100 percent of the additional enhancements desired by those within the SID boundaries. Based on the low bid
received for this project, the principal SID costs to property owners within the tax increment
financing district is just under $100,000. The Board has expressed its intent to use TIF monies
currently on hand to pay those costs after the work has been completed and the assessment
resolution adopted, but prior to the assessments being made.
Pedestrian Railroad Crossing Upgrades $ 50,000
The Board has determined that upgrades to the pedestrian railroad crossing at North Wallace
Avenue/L Street are critical, particularly in light of the impending development of the Story Mill
Park and the North Wallace Avenue reconstruction. The Board wishes to fund upgrades that can be easily and quickly designed and installed. Conversations with Montana Rail Link have revealed that work done within the railroad right-of-way is to be done by its crews, with those
costs to be borne by those making the request. The estimated cost of making the crossing
upgrades that are acceptable to both Montana Rail Link and this Board is $50,000. Initial
conversations with representatives from Gallatin Valley Land Trust and the City’s Parks Department reveal that both entities recognize the crossing also provides enhanced trail connections and, as a result, may contribute some monies toward the upgrade.
Pedestrian Bridge/East Aspen Street right-of-way between North
Rouse Avenue and Bozeman Creek $ 166,200 These projects have been budgeted separately in previous years but have been combined this year
since the Board recognizes the need to improve the pedestrian facilities along East Aspen Street if
the pedestrian bridge is to be installed and dump pedestrians onto an area that is ill prepared to
handle the traffic.
Board members previously identified the need for a pedestrian bridge at the terminus of East
Aspen Street and the North Church Avenue trail east of North Rouse Avenue. East Aspen Street
comes to an end at Bozeman Creek; and the use along this section is largely residential with a
retail store (butcher shop) at the southeast corner of North Rouse Avenue and East Aspen Street.
During FY11, the NURB received positive feedback from the Northeast Neighborhood Association (NENA) on the project and Gaston Engineering completed a feasibility study and
cost estimates. Construction of the bridge was estimated between $52,470 and $57,715. The
Board has previously budgeted $60,000 for the bridge. This year the new draft floodplain and
floodway map was prepared and is now subject to review and comment prior to its final adoption.
This map has dramatically impacted the area where the bridge is proposed, and the costs of that
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Northeast Urban Renewal Board Annual Work Plan and Budget FY17 6
bridge installation are now double the original estimate because of the additional span that will be
needed. As a result, the monies previously budgeted will fund approximately half of the project.
Also, questions have been raised about whether there is adequate room for the bridge installation given physical constraints of the area.
The Board realizes that the right-of-way for East Aspen Street and the location of the street
within that right-of-way need to be identified in light of the potential for future infrastructure
improvements. Since this is an older part of town, original corner pins are not easily found. A survey of this right-of-way was completed a few years ago, but that survey must be reviewed to
determine the edges of the street right-of-way, which will make future street improvements easier
to design as well as allow property owners to know exactly where their property lines are located.
This information may also help with the future improvements to North Rouse Avenue.
Quiet Zone – Feasibility Study $ 25,000
Board members have expressed an interest in pursuing a quiet zone for the North Wallace Avenue
railroad crossing. The first step in that process is to complete a diagnostic review of the crossing
to identify the type of improvements needed to allow for a quiet zone. The Board also recognizes
that the railroad crossing at North Rouse Avenue is close enough to this district that it also impacts the lives of the residents within this tax increment financing district. It is hoped that this
diagnostic review will provide information that will encourage others to recognize the viability
and desirability of funding the installation of the quiet zones at both locations.
If the diagnostic review reveals that a quiet zone is determined beneficial to the community and financially feasible, the Board may choose to actively pursue community support for installation
of a quiet zone on the North Wallace Avenue crossing. This may include some financial
commitment toward the construction project, with those monies potentially coming from the tax
increment or possibly the bond proceeds.
Public Arts Program $ 5,000
The North Wallace Avenue street reconstruction project includes a traffic circle and a median.
Those elements are to include pads for the potential future installation of sculptures, possibly
through a rotating art program.
Given the number of artists within this district and immediately surrounding area, it is important
to recognize this component of the district’s character. One option might be to use this funding
as matching funds for a grant that would facilitate placement of additional artwork throughout the
district. Other options might include using these monies to provide some type of special intersection crossings at the entrances to the district or to provide some type of artistic
enhancement on a bridge or bridges providing entrance to the district.
Infrastructure Total $ 1,603,700
Rationale: The infrastructure improvements meet Guiding Principle 1 and Goals A & B under
Principle 1 of the adopted Northeast Urban Renewal District Plan:
• Guiding Principle, “Ensure the health, safety, and security of the District”
• Goal A, “Outdated or insufficient infrastructure should be repaired, replaced or
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Northeast Urban Renewal Board Annual Work Plan and Budget FY17 7
otherwise improved.”
• Goal B, “Encourage a land use pattern that facilitates all modes of transportation – vehicular, bicycle, pedestrian, mass transit, and commercial – for safe, efficient and convenient access for residential, commercial, and industrial uses.”
The spending of TIF funds on infrastructure improvements is allowed under Section 7-15-4288,
MCA which states, “Costs that may be paid by tax increment financing” allows the municipality to use tax increments to pay the following costs of or incurred in connection with an urban renewal project: (1) land acquisition; (2) demolition and removal of structures; (3) relocation of
occupants; (4) the acquisition, construction, and improvement of infrastructure;… and 5) costs
incurred in connection with the redevelopment activities allowed under 7-15-4233…
PARKS, TRAILS AND GREENSPACE District Trails and Depot Pocket Park Area Maintenance $ 5,000
The original trail, landscaping and bench installation were completed in 2012. Landscaping
maintenance, including mowing and weed spraying, is on-going. Water is provided, as needed, from an adjacent property. The Board proposes continuing the operation of the temporary irrigation system, weed control and general maintenance. Weed control and general maintenance
may also be needed in other District trail areas. The Board is considering additional irrigation
improvements to enhance maintenance possibilities as well as an aggressive program to eliminate
knapweed in the East Aspen Street right-of-way. Parks/Trails Total $ 5,000
Rationale: The park, trail and greenspace improvements meet Guiding Principle 4 and Goals A &
B under Principle 4 of the adopted Northeast Urban Renewal District Plan:
• Guiding Principle, “Public open space is essential to a healthy and appealing
urban environment”
• Goal A, “Procure new land for parks and public open space”
• Goal B, “Improve landscaping in existing public spaces.”- to include enhancing
boulevards and public rights-of-way by planting and maintaining trees where appropriate and
controlling weeds
The spending of TIF funds on park and open space improvements is allowed under 7-15-4255,
Authority to provide or contract for services related to urban renewal, of the Montana Code
Annotated. Specifically, item (1b) states that “Every municipality shall have power to install,
construct, and reconstruct streets, utilities, parks, playgrounds, and other public improvements”
NEIGHBORHOOD DEVELOPMENT PLANNING Depot Rehabilitation Project $ 1,000
The Northeast Urban Renewal Board recognizes the importance of the depot within the district.
Stabilization of the depot was accomplished, and some renewed interest in reuse of the depot has been expressed. If permission can be obtained from the railroad, the Board has expressed its
strong interest in taking any necessary steps to preserve and rehabilitate the structure.
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Northeast Urban Renewal Board Annual Work Plan and Budget FY17 8
Planning Total $ 1,000
Priority III Rationale: Neighborhood Development Planning meets Guiding Principle 2 and the Goal under Principle 2 of the adopted Northeast Urban Renewal District Plan:
• Guiding Principles, “Balance commerce and livability in the District within the mixed-use framework” AND “Honor the unique character and vitality of the District”
• Goal, “Harmonize commercial and industrial development with residential quality of
life”
• Implementation Action, “Where historic structures are affected by public or private
development, seek out the advice and assistance of local, state, or federal historic
preservation professionals for opportunities to renovate existing historic structures.” This funding proposal is for Neighborhood Plan implementation activities which are meant to
encourage developers to build on parcels within the Northeast Urban Renewal District. It
recognizes the complexities of redeveloping parcels which have existing substandard buildings
and infrastructure and 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. Board proposes to award grants to reimburse developers for costs allowable under Section 7-15-
4288, MCA, but limited to public infrastructure.
These proposed expenditures are allowable under Section 7-15-4233, subsection (1)(a), MCA,
which grants the City the power to formulate and coordinate a workable program as specified in Section 7-15-4209, MCA, which states : (1) A municipality may formulate a workable program
for utilizing appropriate private and public resources:
(a) to eliminate and prevent the development or spread of blighted areas;
(b) to encourage needed urban rehabilitation;
(c) to provide for the redevelopment of such areas; or (d) to undertake such of the aforesaid activities or other feasible municipal activities as may be
suitably employed to achieve the objectives of such workable program.
(2) Such workable program may include, without limitation, provision for:
(b) the rehabilitation of blighted areas or portions thereof by re-planning, removing congestion,
providing parks, playgrounds, and other public improvements; by encouraging voluntary rehabilitation; and by compelling the repair and rehabilitation of deteriorated or deteriorating
structures; and
(c) the clearance and redevelopment of blighted areas or portions thereof.
Additionally, Section 7-15-4288, MCA states, “Costs that may be paid by tax increment financing” allows the municipality to use tax increments to pay the following costs of or incurred
in connection with an urban renewal project: (1) land acquisition; (2) demolition and removal of
structures; (3) relocation of occupants; (4) the acquisition, construction, and improvement of
infrastructure;… and 5) costs incurred in connection with the redevelopment activities
allowed under 7-15-4233…
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Northeast Urban Renewal Board Annual Work Plan and Budget FY17 9
ADMINISTRATION
Part-time staff and other Administrative Services $ 13,000 The Board needs staff to assist with District Plan implementation. $10,000 is to be transferred to
the Economic Development Division to offset the cost of staff time used to assist the NURB with
District Plan implementation. $3,000 is budgeted to cover administrative services. This money is
a permissible use under state statute 7-15-4288, (5), “costs incurred in connection with the
redevelopment activities allowed under 7-15-4233 and 7-15-4288 (7) “administrative costs associated with the managements of the urban renewal area…”
The Board has previously requested money for public noticing and mailings in the District to
inform property owners about NURB implementation and activities.
This money is a permissible use under state statute 7-15-4233, “Powers which may be exercised
by urban renewal agency or authorized department…(f) to disseminate blight clearance and
urban renewal information;”
Bond Counsel services $ 30,000 The Board has decided it wishes to proceed with the issuance of bonds during FY17 to cover the
costs of infrastructure improvements, as noted above. Some initial costs have been incurred this
fiscal year; however, most of those costs will occur next fiscal year.
Section 7-15-4290, MCA states “(1)(a) The tax increment derived from an urban renewal area may be pledged for the payment of revenue bonds issued for urban renewal projects or of general
obligation bonds, revenue bonds or special assessment bonds issued to pay urban renewal costs
described in 7-15-4288 and 7-15-4289.”
Bond payment $ 55,000 It is anticipated that bonds will be sold this fiscal year to fund the infrastructure improvements
previously identified in this work plan. The budget includes bond proceeds in the amount of $1.5
million. This amount may vary slightly based on the terms and interest rate of the bond sale.
Based on the budgeted amount, it is projected $110,000 will be needed annually to repay those
bonds. It is anticipated the bond sale will occur in the latter half of the fiscal year, so only one semi-annual payment, in the amount of $55,000, will be needed.
Bond reserve $ 33,000
TIF bonds are required to have 30 percent of the projected annual payment held in reserve.
Based on the budgeted amount, it is projected $110,000 will be needed annually to repay those bonds. The TIF bond reserve is projected to be $33,000 annually.
Engineering consultant services $ 60,000
While it is anticipated that most of the engineering consultant costs will be charged against the
specific projects, the consultant attends Board meetings and provides other assistance to the Board; and there is a potential that the consultant will be asked to provide additional services
during the upcoming year that are not specific to any of the projects listed above. When that
occurs, those costs will be charged against this line item.
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Northeast Urban Renewal Board Annual Work Plan and Budget FY17 10
SUMMARY: FY 17 PROPOSED BUDGET URBAN RENEWAL PROJECTS Infrastructure $ 1,603,700
Parks/Trails $ 5,000
Planning $ 1,000 Staff Time $ 10,000 Noticing and Administrative Services $ 3,000 Consultant Costs $ 90,000
Bond Payment $ 55,000
Bond Reserve $ 110,244 Undesignated Reserve $ 136,056 Overall Budget Total $ 2,014,000
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Revenues:2016-17 Budget TIF Bonds
Estimated Beginning Balance $392,500.00 $392,500.00
FY2017 Tax Increment $120,000.00 $120,000.00
Delinquent Increment
State shared/entitlement
Interest $1,500.00 $1,500.00
Bond proceeds $1,500,000.00 $1,500,000.00
Total Estimated Revenues $2,014,000.00 $514,000.00 $1,500,000.00
Expenditures Budgeted:
Maintenance
Trails Maintenance $5,000.00 $5,000.00
Subtotal - Maintenance $5,000.00 $5,000.00 $0.00
Infrastructure
East Tamarack $385,900.00 $20,000.00 $365,900.00
East Peach Street $387,400.00 $20,100.00 $367,300.00
North Wallace Avenue $100,000.00 $100,000.00
Railroad crossing improvements $50,000.00 $50,000.00
Pedestrian Bridge/East Aspen Street $166,200.00 $21,700.00 $144,500.00
Front Street $193,700.00 $25,300.00 $168,400.00
North Ida Avenue $290,500.00 $37,900.00 $252,600.00
Quiet zone feasibility study $25,000.00 $25,000.00
Public Arts Program $5,000.00 $5,000.00
Subtotal - Infrastructure $1,603,700.00 $305,000.00 $1,298,700.00
Neighborhood Development Planning
Depot Rehabilitation Project $1,000.00 $1,000.00
Subtotal - Neighborhood Dev Planning $1,000.00 $1,000.00 $0.00
Administration
Bond Costs $30,000.00 $30,000.00
Staff Support $10,000.00 $10,000.00
Administrative Services $3,000.00 $3,000.00
Bond repayment $55,000.00 $55,000.00
Engineering consultant (KLJ)$60,000.00 $60,000.00
Subtotal Administration $158,000.00 $158,000.00 $0.00
Reserves
Bond Reserve $110,244.00 $45,000.00 $65,244.00
Undesignated Reserve $136,056.00 $136,056.00
Subtotal Reserves $246,300.00 $45,000.00 $201,300.00
Northeast Urban Renewal District
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Total Expenditures $2,014,000.00 $514,000.00 $1,500,000.00
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R:\Accounting\TIFD_Tax_Increment_Financing_Districts\Fund_144_NE_Urban_Renewal\NE_Urban_Renewal_TIF
_Fund_144_Balance_-_05.26.2016.xls\Presentation - 5.26.16
5/26/2016 at 4:05 PM
BEGINNING FUND BALANCE: JULY 1, 2007 -$
ADD: REVENUES
Property Tax Increment 690,542.63$
Other Grants 5,000.00
Intergovt State Shared Revenue - State Entitlement Share 2,432.98
Interest Income 14,259.73
TOTAL REVENUES 712,235.34$
LESS: EXPENDITURES
Office Supplies (52.38)$
Contracted Services/Consultants & Prof Services (184,102.59)
Contracted Services/Maintenance Contracts (1,008.00)
Contracted Services/Engineers (46,571.24)
Contracted Services/General (2,419.00)
In-State Travel & Training (70.00)
Advertising (215.00)
Postage (68.41)
Other/General -
Capital - Infrastructure & Improvements (20,000.00)
Other Financing Uses/Transfers to Other Funds (57,900.00)
TOTAL EXPENDITURES (312,406.62)$
CURRENT FUND BALANCE/(FUND DEFICIT)399,828.72$
NE URBAN RENEWAL TIF DISTRICT FUND BALANCE
Fund 144
As Of 5/26/2016
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Community Development Services of Montana
954 Caledonia Street, Butte, MT 59701-9002
Memo
PHONE FAX WEB
406-723-7993 406-723-7993 CDSofMontana.com
MEMO
TO: Brit Fontenot
FROM: Janet Cornish JC and Lanette Windemaker LW
RE: Schedule/Steps for Bozeman NE URD Bond Issue
DATE: May 16, 2016
Week of August 1, 2016
Receipt of Certified Taxable Value of District for FY17. (DOR prepares)
Update of Financial Analysis to determine the size of the bond, coverage, terms, etc. (COB
prepares)
September 5, 2016
• NE URD TIF Board considers and adopts the resolution advising the City Commission
regarding the projects and its commitment of TIF funds to the payment of bonds, with
findings to support this recommendation. (LW prepares)
September 7, 2016
Packet deadline for September 19 City Commission meeting.
September 19, 2016
• City Commission considers and adopts a resolution that:
o Identifies projects
o Provides for and authorizes reimbursement of funds expended before the bond
is issued – this provision must be passed within 60 days of when the expenditure
occurs
o Sets a hearing date (October 17) on the proposed projects and the intent to use
TIF bonds (Dorsey prepares)
October 2, 2016
October 9, 2016
Public Hearing Notice published twice per City of Bozeman requirements
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2
October 17, 2016
• Public Hearing on the projects and associated bond issue is held before the City
Commission
• City Commission considers and adopts resolution that:
o indicates its support of these projects, based on findings set forth in the TIF
Board Resolution (and public hearing) (Dorsey prepares)
o identifies the type of bond, desired terms, etc. that will be used to solicit
responses from banks and other institutions. The resolution serves as an RFP
and authorization to proceed with the solicitation. (Dorsey prepares)
Week of October 17, 2016
RFP distribution
Week of October 31, 2016
Bid opening, and analysis.
Week of November 14, 2016
Agreement with the selected financial institution to buy bonds
November 21 or 28, 2016
• City Commission considers and adopts resolution to sell the bonds per the agreement
with the bank. (Dorsey prepares)
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Memorandum
Date: 10/12/2016
To: Northeast Urban Renewal District Board
Copy to: Brit Fontenot
From: John How
RE: CIP Cost Estimates for Bonding
Remarks
As requested by the Board, KLJ estimated the work to be completed for each project listed
below for Fiscal Year (FY) 16 – 17 and FY 17 - 18. The table outlines estimated costs for each
project as prioritized by the Board at the October 4, 2016 meeting. Additionally, the
estimated costs for both the E. Tamarack and E. Peach Streets have been revised to reflect a
full width street section removal and replacement, as recommended by the City Engineering
Department. We have included the estimated engineering total for each fiscal year to help
the Board budget projects going forward.
Rank Project Construction Engineering/
Admin. (15%)
FY 2017
Eng. Fees
FY 2018
Eng. Fees Item Total
1 East Tamarack $ 506,500 $ 76,000 $ 64,600 $ 11,400 $ 582,500
2 East Peach $ 646,800 $ 97,000 $ 82,400 $ 14,600 $ 743,800
3 North Ida $ 252,600 $ 37,900 $32,000 $ 5,900 $ 290,500
4 Front $ 168,400 $ 25,300 $21,500 $ 3,800 $ 193,700
5
East
Aspen/Pedestrian
Bridge
$ 144,500 $ 21,700 $18,500 $ 3,200 $ 166,200
6*
Quiet Zone –
Diagnostic Review ‐ $ 25,000 $ 25,000 $ 25,000
N/R** General Eng. Srvcs. $ 60,000 $ 60,000
BONDING TOTAL $ 1,718,800 $ 257,900 $219,000 $38,900 $1,976,700
* Cost shown includes Feasibility Study only. NOT INCLUDED IN BONDING TOTAL.
**NOT INCLUDED IN BONDING TOTAL.
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NURB Meeting – November 1, 2016 1
Northeast Urban Renewal Board (NURB)
Regular Meeting
Tuesday, November 1, 2016
The Northeast Urban Renewal Board met in regular meeting at 6:30 p.m. on Tuesday,
November 1, 2016, in the Conference Room, Professional Building, 20 East Olive Street,
Bozeman, Montana. Present: Absent:
Voting Members:
Erik Nelson, Chair Daniel Doehring Bobbi Clem
Robert Pavlic
Jeanne Wesley-Wiese Non-Voting Members:
John Usher Tom Noble
Commissioner Liaison: I-Ho Pomeroy
Staff:
Brit Fontenot, Economic Development Director
Robin Sullivan, Recording Secretary Guests:
John How, KLJ Engineering
Shane Strong, KLJ Engineering Chris Nixon, 719 North Wallace Avenue
Call to Order –Chair Erik Nelson called the meeting to order at 6:34 p.m.
Changes to the Agenda – No changes were made to the agenda.
Public Comment – No comment was received under this agenda item.
Minutes – October 4, 2016. It was moved by Bob Pavlic, seconded Erik Nelson, that the
minutes of the meeting of October 4, 2016, be approved as submitted. The motion carried on a 4-0 vote.
Discussion/Action Items –
Review of project priority list as contained in Resolution No. 2017-01. Chair Nelson noted that at the October meeting, the Board adopted Resolution No. 2017-01, which includes
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NURB Meeting – November 1, 2016 2
the priority list of projects to be completed through bond proceeds. He stated that, since Jeanne
Wesley-Wiese was not present at that meeting, he requested that the list be reviewed at this
meeting, prior to forwarding this resolution to the Commission to initiate the bond sale process.
Jeanne Wesley-Wiese noted that pedestrian networking is part of the first goal for this district.
She stated that the listed projects reflect spending $1.8 million on street infrastructure but only
$78,000 has been spent on trails, which is a significant disparity in funding
Erik Nelson stated that, while he does not disagree with that assessment, the street projects also improve the pedestrian network.
Jeanne Wesley-Wiese reminded the Board that the pedestrian bridge was one its very first
projects. When the Board wanted to know if the area supported the bridge, a survey was done at the NENA meeting, and 45 of the 47 present strongly favored it. She noted that this bridge
provides a pedestrian link for the neighborhood.
Responding to questions from Jeanne Wesley-Wiese, Economic Development Director Brit Fontenot stated there is no intent to incorporate an SID into the funding mechanisms for these projects at this time.
Erik Nelson stated the idea of getting the priority streets in this district on the City’s capital
improvement program has been met with an indication that this district has had its fair share of monies with the North Wallace Avenue improvements, so that is not a source of funding to
stretch the TIF monies.
Jeanne Wesley-Wiese asked if cash-in-lieu of parks could be used to assist with constructing the bridge; the response was in the negative.
Jeanne Wesley-Wiese stated she feels the $20,000 permitting costs estimated by the Director
of Public Service is extremely high, particularly after talking to the person who manages the permits; Shane Strong responded that the permitting costs include engineering and certification costs, so that estimate is not as high as it may appear.
Erik Nelson stated the issue before the Board is to determine if the project priority list in the
resolution is appropriate, recognizing that it is possible only the top two will actually be funded with the bond proceeds. He then asked Jeanne Wesley-Wiese where she would put the pedestrian bridge in the priority list.
Jeanne Wesley-Wiese responded she would place it at No. 3 instead of No. 5. She noted that East Tamarack Street will benefit Kenyon-Noble, which lies outside the district, and the Brewery property, which is no longer a contributing factor in the district. She reiterated her concern that
the more monies are being expended on street infrastructure than on other networking options.
Economic Development Director Fontenot noted that the street designs for East Peach Street, East Tamarack Street, Front Street and North Ida Avenue have not been fully engineered; and
those designs may include opportunities for pedestrians and bicycles.
Erik Nelson stated he appreciates Jeanne Wesley-Wiese’s comments; however, they have not swayed him on the ranking of the priority projects. He believes that having all of the projects shovel ready will give this Board options if other sources of funding become available. He also
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NURB Meeting – November 1, 2016 3
believes that if the street improvements include sidewalks, the pedestrian miles traveled on
those streets would be greater than the miles traveled on the bridge.
John How cautioned that if SIDs are to be incorporated into the funding mechanism for these street improvements, it will add approximately five months to the process.
Bob Pavlic voiced agreement with Erik Nelson’s comments, stating he feels the priority list is
appropriate. As a result of this discussion, no changes were made to the priority list contained in Resolution
No. 2017-01.
Discussion regarding timeline for preparing plans and construction documents for
street improvements and how that dovetails with bonding timeline. Shane Strong stated that, if KLJ receives direction to proceed with preparing plans and construction documents, they
will be ready to bid the project in mid-March
John How stated that he anticipates a three-week window for bidding on the East Peach Street and East Tamarack Street projects, and noted that the bid documents will provide for a staggered construction timeline for those streets so that they are not both being done at the
same time.
Responding to suggestions from Erik Nelson, Shane Strong cautioned that the City may not allow the project to be bid with sidewalks as an alternate rather than a part of the base bid.
Discussion regarding quiet zone in work plan. Economic Development Director Brit
Fontenot stated the feasibility study for the quiet zone cannot be funded through the bond
proceeds. He then noted there has been some initial discussion about talking to other groups
and to include other crossings in the feasibility study, including the one at North Rouse Avenue
and probably the one at Griffin Drive since creating a quiet zone at just the North Wallace Avenue crossing will not provide the desired effect.
John How stated that his discussions with Brad Koon have revealed a single quiet zone would
probably not be approved; and it is Brad’s recommendation that all three crossings be included
in the feasibility study. Economic Development Director Fontenot estimated the broader study would cost $250,000
and cautioned against expending TIF monies to cover all of those costs for a project that would
benefit the entire city. Responding to Erik Nelson, the Director asked how high the priority would be for finding other
groups to partner with this Board in funding the feasibility study. He cautioned that if this is
identified as a high priority, then other priorities will be moved down the list because it takes
time and effort to facilitate partnerships. He then indicated that if the bonding process is completed in January, he could probably undertake this process in March.
In light of the discussion, Erik Nelson asked that further consideration of this item be delayed
until March.
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NURB Meeting – November 1, 2016 4
Discussion on possibly directing staff to initiate CDBG application process.
Economic Development Director Fontenot stated this is a possible alternative funding source for
the quiet zone.
Erik Nelson asked that this discussion also be delayed until March.
Discussion regarding use of the old Depot. Bobbi Clem stated the depot has been a
priority for a lot of people, but it is falling into disrepair and becoming an eyesore. She noted that the district has already lost a historic landmark with demolition of the Brewery, and she is
concerned about the potential of losing a second one.
Bobbi Clem noted that when serving on the Gallatin County Historic Preservation Advisory Board, she found one of the ways to save older buildings is to move them, citing relocation of
the Trident depot to Three Forks as an example. She has researched the depot in Bozeman
and found that it is 36 feet wide and 153 feet long and, since it is made of brick, is heavy. There
are companies that specialize in moving this type of structure, and she voiced an interest in purchasing the building, moving it less than a block to her property and renovating it since Montana Rail Link is not willing to sell the property and reuse efforts in the current location have
been unsuccessful to date.
Bobbi Clem noted that if the depot building were moved, it may be possible to use the strip of railroad property as a trail connector between the Library and the Story Mill Trail.
Economic Development Director Brit Fontenot noted that liability resulting from the building’s
proximity to the railroad tracks is one factor that has hampered reuse. Erik Nelson stated the depot as it sits today is more contextual and better for the neighborhood
than moving it. He noted the real challenge for reuse is insurance, which is a paperwork issue.
He stated that the Board was interested in trying to help with that issue; however, changes in staffing and board leadership distracted from pursuing that effort. He recognized that the building is structurally sound and should be preserved; however, he noted it is not threated by
demolition at this time so there is no urgency in addressing this issue.
Bobbi Clem noted people are not willing to put monies into a building that they do not own. Erik Nelson stated he believes the proposals that have been made to date have had other
issues. He recognized that some people have floated the idea of putting a brewery or a
restaurant in the depot; however, he believes those have been bootstrap operations and did not have the kind of horsepower needed to make them successful.
John How suggested that the feasibility study for a quiet zone might help resolve some of the
issues identified, noting that if the study calls for an 8-foot chain link fence for the crossing, its
installation might help to offset some of the costs and address some of the issues facing reuse of the depot.
Erik Nelson voiced his interest in making the building usable where it is; he does not want to see
it moved. He noted that many other communities have kept their depots, particularly those where commercial development is located next to the railroad. He then voiced an interest in including the depot in next year’s work plan. He concluded by asking that this item be placed on
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the agenda for the March meeting.
Updates on current projects and updated project cost estimates. Shane Strong stated the North Wallace Avenue project is nearing completion, and should be done by the
November 10 deadline.
Responding to Jeanne Wesley-Wiese, Shane Strong stated the City has agreed the contractor is to repair the sidewalks along the street if the property owner approaches them.
Responding to questions from Chris Nixon, Shane Strong stated that the intersection of North
Wallace Avenue and East Aspen Street is not a true intersection, so handicapped access is
provided on only two legs of the intersection.
Staff updates on items of interest to the Board. Economic Development Director Brit
Fontenot stated the Commission will consider this board’s resolution at its November 21 meeting and will hold a public hearing on the sale of bonds at its December 19 meeting. While he will do the staff presentation, he feels it is important for Board members to be in attendance
at those meetings.
Update on financial status of NURB fund. Recording Secretary Robin Sullivan
distributed copies of the revenues and expenditures for Fiscal Year 2016-17 and the
spreadsheet showing revenues and expenditures from the inception of the district. She briefly
highlighted the financial information, noting that only expenditures have been incurred so far in Fiscal Year 2016-17.
Set agenda for December 6, 2016 meeting or cancel meeting. Items to be included
on the December 6 agenda, in addition to the standard agenda items, are: a review of the balance of the process for the sale of bonds and a wrap-up of the North Wallace Avenue construction project.
FYI/Discussion (formerly Neighborhood News). Jeanne Wesley-Wiese announced that the
fall NENA meeting will be held on November 9.
Bobbi Clem announced that she has heard the Brewery property sold; and the Treasure State property is under contract.
Erik Nelson stated he drove down the reconstructed North Wallace Avenue a few days ago.
Shane Strong asked that Board members let him know if anything needs to be addressed since he is doing a punchlist of items to be fixed.
Adjournment – 7:56 p.m. There being no further business to come before the Board at this
time, Chair Nelson adjourned the meeting.
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NURB Meeting – November 1, 2016 6
Erik Nelson, Chair
Northeast Urban Renewal Board
City of Bozeman
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Community Development Services of Montana
954 Caledonia Street, Butte, MT 59701-9002
Memo
PHONE FAX WEB
406-723-7993 406-723-7993 CDSofMontana.com
MEMO
TO: Brit Fontenot
FROM: Janet Cornish JC and Lanette Windemaker LW
RE: Schedule/Steps for Bozeman NE URD Bond Issue
DATE: October 11, 2016
The following is a revised time line for the issuance of a Tax Increment Financing bond for
improvements within the Bozeman Northeast Urban Renewal District. Following this time line,
we have listed alternative funding strategies for the Board’s consideration.
Schedule for the Issuance of Bonds
August, 2016
Receipt of Certified Taxable Value of District for FY17. (DOR prepares)
September 7, 2016
Update of Financial Analysis to determine the size of the bond, coverage, terms, etc. (City of
Bozeman –(COB) prepares)
October 4, 2016 (Tuesday)
NE URD TIF Board considers the projects, alternative financing for infrastructure, and its
commitment of TIF funds to the payment of bonds
November 1, 2016
NE URD TIF Board considers and adopts the resolution advising the City Commission regarding
the projects and its commitment of TIF funds to the payment of bonds, with findings to support
this recommendation. (LW prepares)
November 9, 2016
Packet deadline for November 21 City Commission meeting. (COB prepares)
Packet should include:
• NE URD TIF Board Resolution
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• Financial Analysis as provided by Anna Rosenberry, Administrative Services Director, City
of Bozeman
• Resolution 4732 (Dorsey prepares)
• Notice of December 19 Public Hearing (Dorsey prepares)
November 21, 2016
City Commission considers and adopts Resolution 4732 that:
• Identifies projects
• Provides for and authorizes reimbursement of funds expended before the bond is issued
– this provision must be passed within 60 days of when the expenditure occurs
• Sets a hearing date (December 19) on the proposed projects and the intent to use TIF
bonds
Week of November 30, 2016
Notice of Public Hearing submitted for publication (COB)
Week of November 30, 2016
Inform banks that an RFP for bonds is imminent, and determine to whom it should be sent
(COB)
December 4 and 11, 2016
Public Hearing Notice published twice per City of Bozeman requirements
December 8, 2016
Packet deadline for December 19 City Commission meeting. (COB prepares)
Packet should include:
• Resolution 4734 (Dorsey prepares)
December 19, 2016
1. Public Hearing on the projects and associated bond issue is held before the City Commission
2. City Commission considers and adopts Resolution 4734 that:
• indicates its support of the projects, based on findings set forth in the TIF Board
Resolution (and public hearing)
• identifies the type of bond, desired terms, etc. that will be used to solicit responses from
banks and other institutions
• includes bond purchase agreement
• The resolution serves as an RFP and authorization to proceed with the solicitation.
Week of December 19, 2016
Bond RFP distribution (COB prepares)
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3
Week of January 2, 2017
Bond bid opening, and analysis (COB)
Week of January 12, 2017
Packet deadline for January 23, 2017, City Commission meeting. (COB prepares)
Packet should include:
• Resolution XXXX (Dorsey prepares)
Week of January 16, 2017
Agreement with the selected financial institution to buy bonds (COB)
January 23 or 30, 2017
City Commission considers and adopts resolution to sell the bonds per the agreement with the
bank.
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