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HomeMy WebLinkAbout01-06-15 NURB minNURB Meeting - January 6, 2015 1 Northeast Urban Renewal Board (NURB) Regular Meeting Tuesday, January 6, 2015 The Northeast Urban Renewal Board met in regular meeting at 6:30 p.m. on Tuesday, January 6, 2015, in the Conference Room, Professional Building, 20 East Olive Street, Bozeman, Montana. Present: Absent: Voting Members: Tom Noble, Chair Daniel Doehring Erik Nelson Jeanne Wesley-Wiese Robert Pavlic Non-Voting Members: Commissioner Liaison: I-Ho Pomeroy Staff: Brit Fontenot, Economic Development Director Craig Woolard, Director of Public Service Robin Sullivan, Recording Secretary Guests: John Usher, 423 East Tamarack Street Call to Order – Chair Tom Noble called the meeting to order at 6:38 p.m. Public Comment – No comment was received under this agenda item. Consent Items – Approve minutes from December 2, 2014 meeting. It was moved by Erik Nelson, seconded by Bob Pavlic, that the minutes of the meeting of December 2, 2014, be approved as submitted. The motion carried on a 3-0 vote. Discussion/Action Items – Discussion regarding possible financing options for street improvements, including the possible issuance of bonds. Director of Public Service Craig Woolard reported on a discussion he had with Director of Finance Anna Rosenberry. He noted that a tax increment financing district is created for a 15-year period and then dissolves unless a bond has been issued prior its last day. Bonds can be issued for up to 25 years, and bonds can be issued more than once during the term of the district. Based on the taxable value of the district, it could service an annual debt payment of approximately $85,000. Assuming the NURB Meeting - January 6, 2015 2 bonds were issued for 25 years, at an interest rate of 4½ percent, the total amount bonded could be $1.2 million. The Director of Public Service noted that is roughly the amount of the engineer’s estimate for the improvements to East Peach Street and East Tamarack Street. Director of Public Service Woolard noted he has had some discussion with a number of residents along North Wallace Avenue, which is in need of substantial reconstruction; and several of them have voiced an interest in an SID to cover the costs of that project. Based on traffic volumes on that roadway, the Director estimated that the costs would be split on a 50/50 basis, with the City’s street reconstruction fund picking up half of the costs. He then suggested that, through the use of the City’s street reconstruction fund, the tax increment financing district could bond for improvements to all of the streets it has designed plus North Wallace Avenue within the district. The Director of Public Service stated that, if the City’s street reconstruction program monies are to be used, the streets within the district slated for improvement would be prioritized along with other streets in the community. He suggested that most of the streets within this district would probably be high on the priority list. He then cautioned that improvements would probably be spread over two years to minimize impacts on traffic and to the residents and businesses. Erik Nelson asked if the City’s street reconstruction monies can be mixed with the tax increment financing district’s bond to accomplish all of the street improvements. He then observed that if the City’s reconstruction program were not used, this Board could identify its projects, submit their proposal to the Commission and move forward without facing the uncertainty of creating a special improvement district, which would be required under use of the City’s reconstruction monies. Economic Development Director Brit Fontenot reminded the Board that the use of tax increment financing monies must stop at the boundary of the district while other sources of funding don’t have to. Director of Public Service Woolard suggested that the Board consider using bond monies to construct the streets for which designs have been completed, and then pursue a special improvement district for North Wallace Avenue. Responding to Erik Nelson, the Director of Public Service noted that the statewide appraisal is currently underway, and that appraisal could have a significant downward impact on tax increment financing district. As a result, the Director of Finance has cautioned that bonding for this district should not occur until after August, when the results of that appraisal are known. He then noted that special improvement district bonds involve a lot of administrative work. He suggested that, if the Board wishes to pursue improvements to North Wallace Avenue, defining the scope and designing the improvements could be undertaken between now and August so that the project can be included on the schedule of improvements and NURB Meeting - January 6, 2015 3 prioritized. Further responding to Erik Nelson, the Director of Public Service stated he anticipates the improvements to North Wallace Avenue will extend from East Lamme Street to L Street and will not include the railroad crossing. Responding to comments from Chair Noble, Director of Public Service Woolard stated that design of street reconstruction projects is typically done in-house; however, given staff’s current workload, he does not anticipate that would occur until next year. He noted that the street is currently in poor condition, some homeowners along the street have voiced an interest in seeing it improved, and he anticipates there will be significant impacts to the roadway when the Story Mill Park is improved. Responding to Erik Nelson, the Director stated that, if financing allows, this Board could bond a second time. He then noted it is wise to bond and keep the tax increment financing district going; otherwise, funding will stop at fifteen years. Erik Nelson noted that, if the Board could find a way to use tax increment financing monies to fund the portion of the special improvement district for the North Wallace Avenue street improvements within the district, it might help ensure the success of a special improvement district for the entire street. Director of Public Service Woolard reported that residents want to see little traffic circles or some other form of traffic calming included in the street improvements; and the residents would be required to absorb those costs through the special improvement district. Chair Noble responded that those improvements lie outside this district. Director of Public Service Woolard asked if this Board is willing to budget tax increment financing monies to design North Wallace Avenue improvements within the district, stating he would be willing to fund a like amount to design the entire length of the project. He noted that Morrison-Maierle could then be hired to do the design over the winter and spring, with the street improvements then being bid out in phases to minimize impacts on those within the district. Responding to questions from Chair Noble, the Director of Public Service noted that improvements to North Wallace Avenue are the only missing link in the transportation system in this district; and the entire length of that street needs to be improved. He feels that meshing of the various funding mechanisms to accomplish the improvements can be accomplished before August, which is the first opportunity for this Board to consider bonding for its street improvements. Erik Nelson noted he does not want to miss out on opportunities to address underground NURB Meeting - January 6, 2015 4 issues, such as water and sewer lines, as the street improvements are made. Director of Public Service Woolard stated the sewer line in Front Street is one of those issues, particularly since it will not support any future hospital expansion. As a result, he agreed it would be worth considering if Front Street becomes part of the street reconstruction project. He suggested that the need to replace the sewer line could result in that replacement actually funding a portion of the road reconstruction. He then stated the stormwater needs have already been addressed in the street designs. Chair Noble questioned how consensus on the North Wallace Avenue improvements would be reached. He observed that the Board has accomplished the designs for the other street improvements rather easily; and he is concerned that the North Wallace Avenue design will be much more difficult and could potentially slow the process down. He then indicated he has no problem with designing those street improvements within the district but is concerned about the impact that property owners outside the district might have on the process. Director Woolard stated it is good to have one firm design the entire street; however, he stressed that the street improvements outside the tax increment financing district will be subject to public involvement. He then noted the street reconstruction will be done within the existing right-of-way and will include fixing the curbs and the stormwater system. Chair Noble stated he supports the issuance of tax increment financing bonds rather than a special improvement district for street improvements within the district. Erik Nelson noted that if the Board chooses to bond for all of the other street improvements, it will be at its maximum bonding capacity. He suggested, however, that the Board could choose to use the remaining balance of the annual increment to cover the costs of the special improvement district payments on properties within the district for the North Wallace Avenue improvements. Director of Public Service Craig Woolard estimated that $50,000 will cover the costs of designing the improvements to North Wallace Avenue. He then noted that if a special improvement district for the improvements fails, other sources of funding could be considered. He then indicated that if funding is identified, the project could be bid next winter and then constructed in summer 2016. Responding to Erik Nelson, the Director stated that the first bond payment will not happen until after the construction costs are known, which means it will be at least a year. He then expressed his strong interest in getting the design started as soon as possible, cautioning that if it is not started until after July 1, it will not be completed until next fall or winter. Chair Noble noted the next item on the agenda is a discussion on the budget; however, his preference is to hold that discussion until next month when this Board might have firmer NURB Meeting - January 6, 2015 5 numbers with which to work. He then voiced his frustration that he had come into this meeting anticipating a discussion on the streets that have already been designed, but this discussion has revolved entirely around North Wallace Avenue. Responding to Bob Pavlic, Director Woolard suggested that improvements at the intersection of East Tamarack Street and North Wallace Avenue could possibly include a traffic circle or curb bulbs. He then expressed his interest in seeing this be a pedestrian friendly area. He also cautioned that the Story Mill Park could create additional traffic in this area, and North Wallace Avenue will be a detour when the North Rouse Avenue project is undertaken. Review line items in current year budget; initial discussion regarding budget for Fiscal Year 2015-2016. Chair Noble requested that, since two board members are absent, this item be moved to next month’s meeting along with discussion on a possible budget amendment to include design of North Wallace Avenue improvements in this year’s budget. Set agenda for February 3, 2015 meeting or cancel meeting. Chair Noble requested that the discussion on street lighting be moved to the February or March meeting. He also asked that discussion on unimproved rights-of-way within the district be moved to March, with the Gallatin Valley Land Trust possibly being invited to participate in that discussion. Items to be included on the February agenda include a budget amendment to include design of North Wallace Avenue improvements in this year’s budget, discussion on the work plan and budget for the upcoming fiscal year, and election of a Chair and Vice Chair. Neighborhood News. Erik Nelson noted that he worked with developers who helped to spearhead the creation of this district, which he continues to love. Adjournment – 8:05 p.m. There being no further business to come before the Board at this time, Chair Noble adjourned the meeting. Tom Noble, Chair Northeast Urban Renewal Board City of Bozeman