HomeMy WebLinkAbout10-08-21 Correspondence - L. Guercio - Business License Violation - Group Day Care (2107 Highland Court)CROWLEY I FLEC K
ATTORNEYS
October 6, 2021
City of Bozeman
City Commissioners
c/o City Clerk
121 N. Rouse, Suite 201
Bozeman, MT 59715
LARA D. GUERCIO
1915 South 19th A venue
Bozeman, MT 59718
PHONE: 406-522-4517
FAX: 406-256-0277
lguercio@crowleyjleck.com
Re: Business License Violation: Group Day Care (2107 Highland Comt)
Dear City Commissioners:
I am writing on behalf of my client, Daniel Zyvoloski, who resides with his family at 2108
Highland Court, to appeal, in accordance with and pursuant to BMC § 12.02.190, the City of
Bozeman' s decision in a letter sent on September 21, 2021 by Mr. Matsen, Director of
Community Development (refened to herein as the "City Decision Letter" and a copy of which
is enclosed herewith). The City Decision Letter outlines three main reasons as to why the City
believes that group day-cares should be exempt from obtaining a local business license,
including the subject group day-care business, which is cmTently operating from the residence
located at 2107 Highland Comt and across the street from my client's home. Our continued
position is that a business license is required for the operation of the subject day-care, due to the
fact that no applicable exemption to such licensing exists under state law or the BMC.
The City Decision Letter first references the compliance of the group day-care home at 2107
Highland Comt. However, without first obtaining a building permit from the City, the day-care
operator recently installed egress windows in the basement of2107 Highland Ct., a structural
alteration required for its day-care facility to comply with§ 37.95.705 of the Administrative
Rules of Montana. The City issued a Stop Work Order on September 21, 2021, which was
ignored by the contractor and day-care operator. Also, as referenced in Mr. Zyvoloski's s earlier
e-mail to the City, the day-care operator moved its pre-existing operation to the cunent location
at 2107 Highland Ct., so that they could also operate an auto detail business at their cmTent home
address. This home-based auto detailing business was operated without a license, and its
continued non-compliance with the BMC was enforced earlier this year by the City's Code
Compliance Officer. In sum, the day-care operator already has a track record of non-compliance
with BMC, via multiple existing violations to date.
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City Commissioners
October 6, 2021
Page 2
Second, the City Decision Letter references the zoning of the residential neighborhood where the
subject day-care business (which is cmTently registered with the Montana Secretaiy of State's
Office as a general for-profit corporation) is currently located. But, this is a moot issue as to the
City's business licensing, since all businesses, including Home Based Businesses, unless
specifically exempted, are required by the BMC to obtain a business license, regardless of zoning
designation, within the City's limits.
However, the City's zoning is relevant to the number of children that the group day-care serves
and plans to serve at 2107 Highland Ct. As noted in the City Decision Letter, MCA§ 76-2-412
considers "a day-care homes serving 12 or fewer children" a permitted use in all residential
zones. The tenant day-care operator publicly stated at a meeting with multiple neighbors and in a
letter supplied by the homeowner earlier this year that they plan to increase the number of
children the day-care serves to 15. S.B. No. 142 (passed earlier this year and effective 10/1/21)
revised the definition of "group day-care home" in MCA § 52-2-703 to allow it to provide care
for up to 15 children. This revision is specific and limited to the Montana Child Care Act (MCA
§§ 52-2-701 et seq.), which includes requirements for day-care registration and licensing.
Notably, and applicable here, S.B. No. 142 made no revisions to MCA 76-2-412. Further, the
BMC's definition of "group day care home" also limits it to serving up to 12 non-residents. As
such, a group day-care serving more than 12 children at 2107 Highland Ct. (located in the R-1
district) would not be in compliance with the BMC or permitted by state law in regard to zoning.
Third, the City Decision Letter references BMC§ 12.01.010.A.1, which is restated in full below.
However, the City has yet to identify where in the BMC or in state law that group day-cares are
exempted from the requirement of obtaining local business licenses.
"Business" is meant to include all kinds of vocations, occupations, professions,
enterprises, establishments, and all other kinds of activities and matters, together
with all devices, machines, vehicles and appurtenances used therein, any of which
are conducted for private profit, or benefit, either directly or indirectly, on any
premises in this city, not exempted by state law or this chapter. (Emphasis added).
Relatedly, the City Decision Letter states that, "The City does not require a business license for
the practice of professions regulated by the state." However, from our review of the City's
current business licensing website, its business license application, and Chapter 12 of the BMC,
local business licenses are required for many businesses which are "regulated" by the State of
Montana, ranging from plumbers and electricians to medical marijuana businesses. Notably,
marijuana businesses are heavily "regulated" by Montana, including under the Montana
Marijuana Act (MCA§ 50-46-301 et seq.). However, the City specifically calls out these
businesses as requiring local business licenses on the City's cunent business license application.
The conect and applicable legal standard for whether a business is "exempted by state law" from
having to file for and obtain a local business license is whether the occupation or profession is
specifically exempted from the imposition of a municipal license fee or license tax. Many such
express exemptions (or municipal license fee/tax prohibitions) are specifically set f01ih under
MCA Title 37 (Professions and Occupations), including but not limited to: Architects; Attorneys;
City Commissioners
October 6, 2021
Page 3
Barbers/Cosmetologists; Dentists; Dental Hygienists; Insurance Agents; Physicians; Real Estate
Brokers; and Veterinarians. However, to the best of our knowledge, which is based on recent and
detailed legal research on this issue-no local business license exemption for Childcare
Providers or Day-Care Operators exists under Montana state law. And while group day-cares are
required to hold a "registration ce1iificate" issued by the Montana Dept. of Health and Human
Services under the Montana Childcare Act, codified in MCA Title 52, there is no existing state
exemption for these day-care businesses from local licensing requirements.
Finally, other cities in Montana, such as Great Falls and Missoula, specifically call out on their
business licensing website or licensing application that day-cares must, like all other non-exempt
businesses, apply for local business licenses (and are subject to applicable fees).
Per separate co1Tespondence sent to the City on September 1, 2021, I have stated, on behalf of
my client, that we are willing to drop this appeal if the City can specifically reference for us by
October 15, 2021 where an existing exemption to local business licensing exists in the BMC or
state law, which is clearly applicable to a for-profit, group day-care business (and subject to our
fmiher review of the legal merits of any such referenced exemption).
We are hopeful that the City will not elect to needlessly spend taxpayer dollars defending its
cmTent position, which to our cmTent knowledge is not reinforced, supported or defined by
applicable state law or the City's code. However, if the City elects to defend its position set f01ih
in the City Decision Letter, we hereby request a public hearing before the City Commission and
your further review and related findings regarding the City's subject decision.
LARA D. GUERCIO
cc: Jeff Mihelich, City Manager (USPS and email); Chuck Winn, Assistant City Manager
( email); Maiiin Matsen, Director of Community Development ( email); Greg Sullivan, City
Attorney ( email); Kelley Rischke, Assistant City Attorney ( email); Daniel Zyvoloski ( email)
Enclosures: City Decision Letter; Letter to M. Matsen re Business License Violation (8-31-21 );
Email to City from D. Zyvoloski (8-12-21); Public Comment to City from D. Zyvoloski (7-2-21)
BOZEMAN MT
Community Development
Lara D. Guercio
Crowley'Fleck
1915 South 19th Avenue
Bozeman, MT 59718
Re: Group Day Care (2107 Highland Court)
Ms. Guercio:
I have received your letter of formal complaint on behalf of your client regarding the group
day care at 2107 Highland Court. The City also received an email from Mr. Zyvoloski on
August 13, 2021. This letter responds to both communications. After consulting with the
City Attorney and in accordance with our previous advice, the City of Bozeman disagrees
that a business license is required to run an otherwise compliant group day care in a
residential neighborhood within the City. Therefore, no violation of the Bozeman
Municipal Code (BMC) has occurred.
First, please be advised that group day cares are authorized in the State of Montana in any
residential zone. See Mont. Code Ann.§ 76-2-412. Additionally, the BMC addresses and
regulates various kinds of daycare facilities in both residential and commercial zoning
districts. The property at 2107 Highland Court is in a residential area zoned R-1. A group
day care is a principal use in the R-1 zoning district, meaning it is fully permissible under
City code. See 38.310.030, BMC. The City understands that not every house or
neighborhood will be a good fit for a day care facility, which is in part why the code
requires day care facilities to be either licensed or registered with Montana's Department
of Public Health and Human Services (DPHHS). Under DPHHS regulations, group day care
facilities must provide proof of liability and fire insurance, minimum amounts of indoor
and outdoor space for each child, and specific means of ingress and egress, among many
other things.
Next, the City generally requires a business to be licensed, unless the business is exempt
pursuant to state law or by other provisions of the code. See 12.01.010.A.1, BMC. The State
of Montana is the regulatory and licensing authority for many professions, including
daycare businesses. The City does not require a business license for the practice of
professions regulated by state law. Therefore, the City does not require any licensure of
day care businesses beyond what is required by state law. DPHHS Registration
requirements for family and group daycares share many similarities with licensure
requirements for larger day care centers, including penalties for violations of state law. See
Mont. Code Ann.§ 52-2-741.
@ 20 East Olive Street j @ ~-~-e~~n1•2~~ 59771_1230 I ® 406-582-2260 j (D 406-582-2263 j www.bozeman.net
TDD. 406 -5 82-2301 THE MOST LIVABLE PLACE .
Page 2 of 2
BOZEMAN MT
Comm unity Development
Finally, we look forward to the continued involvement of all citizens on updates and edits
to the municipal code. Citizens are notified of proposed changes to the municipal code in
multiple ways: through the City's website on City Commission agendas at
www.bozeman.net/government/city-commission; by publication in the Bozeman Daily
Chronicle legal ads; and by posting in City Hall. Unfortunately, due to the variety of issues
and volume of interest on any given topic, it is not possible for the City to provide direct
notice to you if the City proposes any changes in the future to municipal codes regarding
day care facilities or business license requirements.
Sincerely,
?L>4L
Marty Matsen
Director of Community Development
c: Jeff Mihelich, City Manager
@ 20 East Olive Street I @ ~-~-e~~n1,2~~ 59771 _1230 I ® 406-582-2260 ' (D 406-582-2263 : www.bozemon .net
TD D. 406-5 82-2301 THE MOS T LIVABLE PLACE .
CROWLEY I FLECK
A T T O RNEY S
August 31, 2021
City of Bozeman
Maitin Matsen
Director of Community Development
P.O. Box 1230
Bozeman, MT 59771
LARA D. GUERCIO
1915 South 19th A venue
Bozeman, MT 59718
PHONE: 406-522-4517
FAX: 406-256-0277
lguerc io@crowleyjleck.com
Re: Business License Violation: Group Day Care (2107 Highland Court)
Dear Mr. Matsen:
I am writing on behalf of my client, Daniel Zyvoloski, who resides with his family at 21.08
Highland Comt, to file a formal complaint against the operators of a commercial group day care
facility located at 2107 Highland Comt, which is presently and has been operating for several
months now from this location without a business license. As such, the subject group day care
operator and facility is operating out of compliance with Section 12.02.010 of the Code.
We have reviewed the Code, including its business licensing requirements and exemptions, as
well as for any applicable state law exemptions. From the text of the Code and applicable state
law, the subject group day care is clearly not exempt from local business license requirements.
We are filing the present complaint under Section 12.02.240 of the Code to request that an
investigation of this violation and appropriate action be taken under Chapter 12 of the Code.
Please advise us of the City's formal decision regarding this matter at your earliest convenience.
Additionally, since my client and his neighbors would be specifically affected, we request direct
notice regarding any changes proposed by the City to the Code applicable to day cares, including
Sections 12.02.040 (Exemptions) and 38.700.050 (Definitions).
Yourshul~a-c.,.ff. ~~
LARA D. GUERCIO
cc: Jeff Mihelich, City Manager (by USPS); Daniel Zyvoloski (by email)
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Lara Guercio
From:
Sent:
To:
Subject:
Attachments:
Lara Guercio
Wednesday, October 6, 2021 2:47 PM
Lara Guercio
FW: Group day-care at 2107 Highland Ct.
Thank you for your public comment.
From: Daniel Zyvoloski <dan@kroenkeranches.com>
Sent: Thursday, August 12, 2021 4:00 PM
To: Martin Matsen <MMatsen@BOZEMAN.NET>; Lara Guercio <lguercio@crowleyfleck.com>
Cc: l<elley Rischke <KRischke@BOZEMAN.NET>; Mark Carpenter <MCarpenter@BOZEMAN.NET>; Anna Rosenberry
<ARosenberry@BOZEMAN.NET>; Jeff Mihelich <jmihelich@BOZEMAN.NET>; Chuck Winn <CWinn@BOZEMAN.NET>;
Teri.Whitesitt@mt.gov; Greg Sullivan <gsullivan@BOZEMAN.NET>
Subject: RE: Group day-care at 2107 Highland Ct.
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Dear All,
Thank you for your time and consideration regarding this important issue. I wanted to provide some additional
background information, as we have decided to move forward with a formal complaint to the city regarding the non-
compliance of the daycare business located at 2107 Highland Ct. To save the city time and resources, a group of
neighbors decided to move forward with one formal proceeding, represented by myself and Ms. Guercio. Also enclosed
is my submission to the city commission dated July 2nd regarding this issue. It is my understanding that there were
additional letters sent to the commission regarding this topic as well.
First, 11 surrounding neighbors communicated (via multiple letters and neighborhood meetings) with the homeowner
and the daycare operator who leases the property concerning a 12-15 child daycare at this location. None of the
neighbor's concerns have been addressed or considered.
Second, we are all aware of the daycare shortage in Bozeman and look forward to working with the city to find the right
balance. As Ms. Whitesitt can confirm, this is not a new daycare. It was in operation at another location in the city prior
to moving to its present location; thus, no more or new local daycare opportunities were created here. The daycare was
moved to Highland Ct. so they could open a commercial auto detail shop at the previous residential location. I informed
Mr. Carpenter of the violation, and as a result of laws in the Bozeman Municipal Code, the business is no longer in
operation.
Third, as a new father, I'm personally motivated by the amount of traffic/parking issues that create a safety issue directly
in front of my house for my family. I believe that home-based daycares can be a solution in Bozeman, but in order for
them to be successful, they need to fit into the residential neighborhoods in which they are proposed to be located,
based on feedback and input from their neighbors, who share the impact. Every house or residential neighborhood in
Bozeman will not be a good fit for a 15-child, home-based daycare.
After researching Bozeman's Community Planning documents, I found that neither daycares specifically nor childcare in
general were ever mentioned. If the city is goirig to be a part of the daycare solution, it will need to figure out how to
successfully incorporate them into the city's planning and growth policies, rather than ignore related community issues,
particularly where located in residential neighborhoods.
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The Bozeman Municipal Code states that: "Business" is meant to include all kinds of vocations, occupations,
professions, enterprises, establishments, and all other kinds of activities and matters, together with all devices,
machines, vehicles and appurtenances used therein, any of which are conducted for private profit, or benefit, either
directly or indirectly, on any premises in this city, not exempted by state law or this chapter. The Code goes on the
list specific Exemptions per 12.02.040, but it does not exclude daycare businesses.
A home-based daycare with 12-15 kids is definitely a business. It is not exempted by any state or local laws from.
business licensing requirements, and it requires a commercial liability insurance policy.
We are not asking the city to impose any additional regulatory requirements on home-based daycares, as Mr. Matsen
indicated below. We are asking the city to enforce the codes that already exist.
Respectfully,
Daniel Zyvoloski
406-570-2716
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Lara Guercio
From:
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To:
agenda@bozeman.net
Friday, July 2, 2021 2:17 PM
Danzyvo@hotmail.com
Subject: Thank you for your public comment.
A new entry to a form/survey has been submitted.
Form Name:
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Public Comment Form
07/02/20212:16 PM
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Time to complete: 5 min. , 10 sec.
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Public comment may be submitted via the form below, or by any of the following options.
Public comment may also be given at any public meeting.
Email:
agenda@bozeman.net
Mail to:
Attn: City Commission
PO Box 1230
Bozeman, MT 59771
First Name
Last Name
Email Address
Phone Number
Comments
Dear Commissioners,
Daniel
Zyvoloski
danzyvo@hotmail.com
4065702716
I am writing this letter to ask the commission to adopt an ordinance or revision to the Bozeman Municipal code that would
allow residents of Bozeman to participate in the review of Group Day Care Home locations. This issue is significant given the
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recent passage of SB 142 that will allow for up to 15 children in a Group Day Care Home compared to the old and current
limitation in the Bozeman Municipal Code that only allows for up to 12 children. Thus, an update to the Bozeman Municipal
Code will be needed to reflect new state law and would provide an opportunity for citizens to participate in a process that
allows for public participation.
Currently, all dwellings or households in any zoning district are allowed to operate a Group Day Care Home with 12 children
without any notice to neighbors or permits issued by the city of Bozeman. The intent and purpose of Bozeman Zoning is to
"respect the character and quality of the designated area". Public participation allows Bozeman residents to support and
have a voice In that purpose.
Our neighborhood that is Zoned Rl had a Group Day Care Home operation open for business a few months back. 15 children f
being dropped off and picked up each day results in up to 600 additional cars per month (15 drop-offs x 15 pickups x 20 ·
business days). This is a significant impact to a street and neighborhood that has no sidewalks and receives minimal snow
removal.
If a neighbor wants to have a chicken or more than two dogs, it must obtain a permit and notify the neighbors of the
proposed plans. This process allows for tax-paying residents of Bozeman to have a voice in how their neighborhood is
shaped. If neighbors are concerned, they have a process by which they can voice their concerns or find solutions.
Additionally, illegal daycare operations are currently an issue the city of Bozeman is dealing with. The state of Montana who
is supposed to be providing oversight, lacks any enforcement capability. The lack of defined enforcement creates a situation
where children's safety is put at risk. If Group Day Care Home's within Bozeman limits are required to obtain a basic permit,
then the city could provide a level of oversite and safety that is currently not available.
Thank you for your time and consideration. I advocate that this issue be brought up for discussion at an upcoming
commission meeting.
If you would like to submit additional documents (.pdf, .doc, .docx, .xis, .xlsx, .gif, .jpg, .png, .rtf, .txt) along with your
comment, you may alternately address agenda@bozeman.net directly to ensure receipt of all information.
Thank you,
City Of Bozeman
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