HomeMy WebLinkAbout06-18-18 City Commission Packet Materials - A6. Resolution 4893, Creation of SID 745 for W. Oak and N. FergusonPage 1
Commission Memorandum
REPORT TO: Honorable Mayor and City Commission FROM: Greg Sullivan, City Attorney
SUBJECT: Public Hearing on Protests Regarding Creation of Special Improvement
District (SID) No. 745 and Adoption of Resolution 4893 - a Resolution of the Bozeman City Commission to Create SID No. 745.
AGENDA ITEM TYPE: Action
MEETING DATE: June 18, 2018
RECOMMENDED MOTION: See the unresolved issues section. If the Commission
determines the move forward with creation of SID 745 the following motion could be made:
“After hearing all protests, and finding them to be insufficient under law to bar further
proceedings, I hereby move to adopt Resolution 4893 creating Special Improvement District No. 745.”
BACKGROUND: At its May 21, 2018 meeting the City Commission adopted Resolution 4892,
declaring it to be the intention of the City Commission to create Special Improvement District
(SID) No. 745 (the “District”) for improvements to West Oak Street and North Ferguson Avenue. In accordance with Montana Code Annotated (MCA) Title 7-12 Part 41, notice of the
passage of this resolution was published in the Bozeman Daily Chronicle on May 27, 2018 and
June 3, 2018 and mailed to the property owner to be assessed. This established the "Protest
Period" as May 27, 2018 to June 11, 2018 at 5:00 PM.
Pursuant to Section 7-12-4113, MCA, no further proceedings may be taken on creation of a
special improvement district for a period of six months if the Commission finds sufficient protest
has been made by the owners of property in the district to be assessed for more than 50% of the
cost of the improvements. Within the Protest Period, Gallatin County filed a protest with the
City Clerk. As the sole property owner in the District, Gallatin County represents 100% percent of the costs of the improvements to be assessed against property in the District. The costs of the
improvements to be assessed against property pursuant to the special improvement district are
only a portion of the total costs of the improvements for Ferguson Avenue and Oak Street (for
more discussion on this please see the fiscal effects section, below).
Attached to this memorandum is a copy of the Annexation Agreement entered into in 2001 by
the predecessor in ownership to Gallatin County. The terms of the Annexation Agreement are
covenants running with the land and are binding on successors in interest (see sects. 23 and 24).
Gallatin County is the successor in interest to WBC, LP, the entity that annexed the property to
755
Page 2
the City. Exhibit A to the Annexation Agreement provides a waiver of right to protest the
creation of special improvement districts for street improvements including paving, curb/gutter,
signals, sidewalk, and storm drainage facilities to Ferguson Road and Oak Street (see pg. 2,
Exhibit A to the Annexation Agreement). Also attached to this memorandum is a copy of an addendum to the purchase agreement entered
into by Gallatin County and the seller of the property wherein Gallatin County recognized it
purchased the property subject to the terms of the Annexation Agreement, including the waiver
of right to protest creation of SIDs. This addendum also recognized that the property may be subject to a SID for improvements to Ferguson Avenue and Oak Street (see sect. 2).
Pursuant to state law, the City Commission must “hear and pass upon all protests.” 7-12-4112,
MCA. Prior to adopting a resolution creating a special improvement district the Commission
must determine whether protest received are valid and sufficient to bar proceeding with creation of the district or whether protests are insufficient or should be overruled. For the creation of SID 745, the Commission must determine the following:
• whether the waiver of right to protest creation of an SID included in the Annexation
Agreement includes the improvements for which this SID is being created;
• whether Gallatin County is bound by the waiver; and
• whether to overrule Gallatin County’s protest relying upon on the waiver.
FISCAL EFFECTS:
Current Plans: The City’s adopted Capital Improvement Plan for FY18-22 includes both of these
street segments (SIF046 and SIF080), with a portion of the costs to be assessed to the Gallatin
County Regional Park property through a special improvement district.
Costs: The total cost of the improvements is $2,152,611.04. The City has committed $902,424.65
from the Street Impact Fee Fund and Flanders Mill Subdivision has committed $347,731.74 for its
share of the improvements to North Ferguson Avenue. The remaining $902,424.65 is to be funded
by the special improvement district, if created. In addition, the District would be responsible for
an estimated $1,000 in incidental costs related to the creation of the District for a total of $903,424.65.
FERGUSON AVENUE – BAXTER LANE TO OAK STREET
Final cost of improvements $946,255.70
City Share (1/3 of improvements) $299,246.98
SID Share (1/3 of improvements) $299,246.98
Flanders Mill Subdivision Share $347,731.74
(1/3 of improvements + 100% of cost of asphalt trail)
WEST OAK STREET – FERGUSON TO NEW HOLLAND
Final cost of improvements $1,206,355.34
City Share (50% of improvements) $603,177.67
SID Share (50% of improvements) $603,177.67
756
Page 3
TOTAL cost of improvements (Oak & Ferguson) $2,152,611.04
TOTAL SID share of improvements (Oak & Ferguson)
TOTAL SID amount (including incidental expenses
expenses)
$902,424.65
$903,424.65
Financing: To fund the costs of the District’s Share of the Improvements, a bond or warrant would be drawn against the District in the amount of $903,424.65, payable from special
assessments to be levied against property in the District semi-annually for three years in an
amount to equal the principal of $903,424.65 plus simple interest at an annual rate as allowed by
Sect. 7-12-4189, MCA.
UNRESOLVED ISSUES:
At its May 21, 2018 meeting, during the adoption of Resolution 4892, the resolution of intent to
create SID 745, the Commission adopted the following amendment to the main motion: “that prior to the assessment of the construction costs associated with SID 745 to the district, the City of Bozeman will seek to resolve any outstanding issues with Gallatin County via a working group
with equal representation from both entities.”
I understand Gallatin County believes that further discussions with the City regarding the
County’s share of costs related to the improvements is not possible if the City Commission has adopted a final resolution creating a new special improvement district. I have no other
information as to the underlying rationale for this position.
Sect. 7-12-4112, MCA, requires the City Commission, at the next regular meeting after the close
of the protest period, to “proceed to hear and pass upon all protests…” This statute also provides the Commission “may adjourn said hearing from time to time.” The effect of adjournment is to
allow protestants the right to withdraw a protest at any time before final action on the resolution
creating the district. The Commission may wish to consider whether adjourning the hearing on
protests to allow for discussions with Gallatin County will facilitate the intent behind its May
21st motion. If so, I suggest that after the Commission accepts public comment and prior to closing the public hearing, the Commission by motion direct one of its members and the city
manager to commence discussions regarding Gallatin County’s protest. If the Commission
determines to engage in discussions with Gallatin County prior to taking action on the resolution
creating the district the Commission must “adjourn” the public hearing to a date certain. If the
Commission adjourns the public hearing to other than a date certain the Commission must provide notice of the hearing in the manner required by law.
ALTERNATIVES: As suggested by the City Commission.
Attachments: Resolution 4893, Creation of SID 745 Letter of Protest from Gallatin County
Annexation Agreement including Waiver of Right to Protest SID Addendum to Gallatin County’s Buy/Sell Agreement for the Regional Park
757
Page 1 of 5
COMMISSION RESOLUTION NO. 4893
A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF BOZEMAN,
MONTANA, RELATING TO SPECIAL IMPROVEMENT DISTRICT NO. 745;
CREATING THE DISTRICT FOR THE PURPOSE OF PURCHASING CERTAIN
LOCAL IMPROVEMENTS IN AND ABOUT NORTH FERGUSON AVENUE
BETWEEN WEST OAK STREET AND BAXTER LANE AND WEST OAK STREET
BETWEEN DAVIS LANE AND NORTH FERGUSON AVENUE, AND FINANCING THE
COSTS THEREOF AND INCIDENTAL THERETO.
WHEREAS, on the 21st day of May, 2018, the City Commission (the “Commission”) of
the City of Bozeman, Montana (the “City”) adopted Commission Resolution No. 4892 (the
“Resolution of Intention”), stating its intent to create Special Improvement District No. 745 (the
“District”) to finance the costs of various improvements within the District as described therein
(the “Improvements”); and
WHEREAS, as set forth in the Resolution of Intention, the Commission committed other
revenue sources to the costs of the project; and
WHEREAS, on May 27, 2018 and June 3, 2018, the City Clerk did publish a Notice of
Passage of the Resolution of Intention to Create SID No. 745 in accordance with Sect. 7-12-4106,
MCA, and mailed said notice to each person, firm, or corporation or the agent of the person, firm
or corporation having real property within the proposed District; and
WHEREAS, the Bozeman City Commission conducted a public hearing on protests
submitted to the creation of the District on June 18, 2018 and did pass on all such protests having
found the written protests not sufficient to bar the Commission from proceeding with creation of
758
Resolution No. 4893 – Creation of SID 745
Page 2 of 5
the District.
NOW, THEREFORE, BE IT RESOLVED by the City Commission of the City of
Bozeman, Montana, as follows:
Section 1
Passage of Resolution of Intention. This Commission, on May 21, 2018, adopted the Resolution
of Intention, pursuant to which this Commission declared its intention to create the District, under
Montana Code Annotated, Title 7, Chapter 12, Parts 41 and 42, as amended, for the purpose
of paying costs of certain local improvements within the District described generally therein (the
“Improvements”), and paying costs incidental thereto, including costs associated with the creation
and administration of the District.
Section 2
Notice of Passage of the Resolution of Intent and Public Hearing on Protests. Notice of passage of
the Resolution of Intention was duly published and mailed in all respects in accordance with law,
and on June 18, 2018, this Commission conducted a public hearing on written protests submitted
by property owners against the creation of the District and the making of the Improvements. The
public hearing occurred on the date of the first regular meeting of the Commission following the
expiration of the period ending 15 days after the first date of publication of the notice of passage
of the Resolution of Intention (the “Protest Period”).
Section 3
Protests. Within the Protest Period, protests were filed with the City Clerk by the only property
owner within the district, representing 100% percent of the total costs of the Improvements to be
assessed against properties in the District, as proposed. The Commission hereby finds that the
protest is invalid on the basis that a waiver of right to protest creation of a special improvement
district was executed by the then-owner of the property in consideration of receiving approval for
759
Resolution No. 4893 – Creation of SID 745
Page 3 of 5
annexation of the property on October 19, 2001. That property owner specifically waived for itself,
and its successors and assigns, the right to protest the creation of one or more special improvement
districts for street improvements including paving, curb/gutter, signals, sidewalk, and storm
drainage facilities to Baxter Lane, Davis Lane/Fowler Road, Deadman’s Gulch Road, Ferguson
Road and Oak Street; trunk water main and appurtenances to serve the property; trunk sewer mains
and sewage lift stations to serve the property; or to make any written protest against the size or
area or creation of the district to be assessed in response to a duly passed resolution of intention to
create one or more special improvement districts which would include the property. The waiver
was recorded with the Gallatin County Clerk and Recorder’s Office on November 14, 2001,
Document No. 2053095.
Section 4
Creation of the District; Insufficiency of Protests. The Commission hereby creates the District
on the terms and conditions set forth herein and otherwise in accordance with the Resolution of
Intention, as modified hereby. The protests against the creation of the District or the making
of the Improvements filed during the Protest Period are hereby found to be insufficient. The
findings and determinations made in the Resolution of Intention, including, without limitation,
those relating to benefits conferred, assessment methodology, cost of improvements, method of
financing, and costs associated with the creation and administration of the District, are hereby
ratified and confirmed. The Commission finds the Improvements preserve public safety and
provide public benefit by expanding the transportation system, improving transportation system
connectivity and traffic flow, providing pedestrian ramps and traffic control signage, and providing
through lanes and drive approaches for those who reside along these streets or use these streets to
access their residences, businesses, places of work and recreation. The Commission further finds
the Improvements especially benefit the property in the District by providing for the construction
of all street facilities required by the Bozeman Municipal Code. In addition, the Improvements to
West Oak Street and North Ferguson Avenue adjacent to the Park improve public safety, especially
for users of the Park, by the installation of through lanes, sidewalks, parking lot approaches,
pedestrian ramps and crosswalks, traffic control signage and pavement striping. West Oak Street
had no sidewalk adjacent to the Park, so the installation of a sidewalk there is an improvement to
760
Resolution No. 4893 – Creation of SID 745
Page 4 of 5
the Park that will especially benefit its pedestrian users by improving pedestrian safety and access
to the Park by pedestrians. The construction of North Ferguson Avenue adjacent to the Park, along
with installation of sidewalk and other related improvements, benefits the Park and especially
benefits Park users by improving safety and adding to accessibility.
Section 5
Purchase of Improvements.
5.01. Declaration of Intent. The City reasonably expects to purchase the Improvements using the
proceeds of a bond or warrant drawn against the District in an estimated maximum aggregate
principal amount of $903,424.65 after the date of payment of the costs of the Improvements. All
reimbursed expenditures shall be capital expenditures, a cost of issuance of the bond or warrant,
or other expenditures eligible for reimbursement.
The Commission intends to assess the District over a three year period in an amount equal to the
principal of $903,424.65 plus simple interest at an annual rate as allowed by Montana Code
Annotated sect. 7-12-4189.
5.02. 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 Improvements, other than pursuant to the bond or warrant. 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.
5.03. Payments. The City's financial officer shall be responsible for making the payments
described in the Resolution of Intention being generally the transfer of the appropriate amount
of proceeds of the bond or warrant to reimburse the source of temporary financing used by the
City to make prior payment of the costs of the Improvements. Each payment shall be evidenced
by an entry on the official books and records of the City maintained for the bond or warrant
761
Resolution No. 4893 – Creation of SID 745
Page 5 of 5
or the Improvements and shall specifically identify the actual original expenditure being paid.
PASSED, ADOPTED, AND APPROVED by the City Commission of the City
of Bozeman, Montana, at a regular session thereof held on the 18th day of June, 2018.
__________________________________
CYNTHIA L. ANDRUS Mayor
ATTEST:
________________________________________ ROBIN CROUGH City Clerk
APPROVED AS TO FORM:
__________________________________
GREG SULLIVAN
City Attorney
762
763
764
765
766
767
768
769
770
771
772
773
774
775
776
777
778
779
780
781
782
783
784
785
786
787
788
789
790
791
792
793
794