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Home My WebLink AboutC9. Res 4644 Amending North 7th TIF Commission Memorandum REPORT TO: Honorable Mayor and City Commission FROM: David Fine, Economic Development Specialist SUBJECT: Resolution 4644 amending the Fiscal Year 2016 (FY16) North 7th Tax Increment Finance District Fund Budget to Include Additional Expenditures of $554,000 for Constructing a City-Owned Conduit System to Incentivize the Provision of Next Generation Fiber Optic Telecommunication Facilities by the Private Sector within the Urban Renewal District. MEETING DATE: December 14, 2015 AGENDA ITEM TYPE: Consent RECOMMENDATIONS: Staff recommends adoption of Resolution 4644. The North Seventh Urban Renewal Board (which will be renamed the Bozeman Midtown Urban Renewal Board (NSURB), effective 12-16-2015) unanimously approved a motion to amend the board’s proposed work plan and budget for the urban renewal district to include additional expenditures in support of Phase 1 of this project. SUGGESTED MOTION: Having conducted a public hearing, considered written and spoken public testimony, and based on the findings contained in this and other related staff memoranda, the recommendation of the North Seventh Urban Renewal Board, the content of Resolution No. 4644 and findings articulated by the Commission during discussion, I hereby move to adopt Resolution No. 4644. BACKGROUND: The Bozeman Fiber Master Plan and Feasibility Study, adopted pursuant to Commission Resolution No. 4576, recommends that the City make “targeted investments in passive infrastructure,” such as conduit and handholes, that incentivize the installation of broadband infrastructure by the private sector. The City Commission approved a budget amendment (Resolution No. 4598) for $100,000 for engineering and project management costs related to 86 installation of fiber optic conduit infrastructure in the North 7th Urban Renewal District. The conduit project detailed in the attached exhibit shows the outcome of this effort as a phased construction project. Phase 1 of the project shows conduit for backbone and distribution fiber on the east side of the corridor with street crossings and maintenance holes for distribution fiber located at locations of west side of the corridor. The district may, propose a grant program for making the final connections (“drops”) to businesses from the new conduit infrastructure as businesses and redevelopment projects seek to use the new conduit infrastructure to get fiber connectivity. Drops can be constructed to the business for fiber to the premise (“FTTP”) connectivity from any maintenance hole. Maintenance holes for this project are designated as “MH” on the project diagram. An additional alternative scope will be added to the bid documents that includes additional crossings to the west side of the corridor if project bids are competitive. The recently adopted (Ordinance 1925) Bozeman Midtown Urban Renewal District Plan also calls for incentivize the installation of broadband infrastructure throughout the district to facilitate blight remediation by means of enhanced infrastructure that may attract new businesses, and support existing businesses. Goal Three from the plan addresses broadband infrastructure; relevant selected passages from the plan are included below: Goal #3 Improve, Maintain and Support Innovation in Infrastructure Rationale: Infrastructure is the backbone of the community. Private development typically requires a corresponding public investment in infrastructure. Therefore, capital improvements in the district will help achieve economic vitality and address conditions that contribute to blight. Planning Initiatives  Continue to examine the opportunities to improve communication infrastructure access through upgrades and innovation  Examine parking strategies that support higher density, mixed use development  Consider the issuance of tax increment financing bonds, as revenues permit, in support of Program Initiatives and Capital Projects, such as public parking facilities, communication infrastructure, streetscape elements, and other public infrastructure  Support implementation of the Bozeman Fiber Master Plan and Feasibility Study, the community effort to address the broadband network, the crucial infrastructure necessary for next generation fiber-optic connectivity Program Initiatives  Continue the program to improve broadband infrastructure, and facilitate public-private partnerships in support of improved broadband infrastructure  Continue to support open access fiber optic networks to provide affordable broadband for the region’s business community, public sector and residents, as described by the Bozeman Fiber Master Plan and Feasibility Study adopted pursuant to Resolution #4576. Capital Projects  Improve overall communication connectivity  Support infrastructure improvements to and expansion of the broadband network for next generation fiber-optic connectivity 87 UNRESOLVED ISSUES: • As engineers work to put the finishing touches on the bid documents for Phase 1 of the plan, they will advance a series of additional alternatives to maximize the amount of infrastructure that can be constructed within the proposed project budget. The total scope of the final project will depend on bids. ALTERNATIVES: As determined by the Commission. FISCAL EFFECTS: The estimated cost of Phase 1 of the project is $554,000. The increased appropriations shall be funded from un-used cash reserves in the North 7th Tax Increment District Fund. Amended appropriations include capital carry-over items from FY15, in accordance with Resolution No. 4602. Current Beginning and Ending Reserves estimates are as follows Beginning FY16 Estimated Revenues Amended Appropriations Amended FY16 Ending Balance $2,045,705 $728,013 $1,654,980 $1,118,738 Attachments: 1. Resolution No. 4644 2. Conduit System diagram with potential fiber backbone phases marked 3. NSURD Conduit System Phase cost estimates Links: 1. Bozeman Fiber Master Plan and Feasibility Study Report prepared on December 7, 2015. 88 Page 1 of 3 COMMISSION RESOLUTION NO. 4644 A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF BOZEMAN, MONTANA, AMENDING FISCAL YEAR 2016 (FY16) NORTH 7TH TAX INCREMENT FINANCE DISTRICT FUND BUDGET TO INCLUDE ADDITIONAL EXPENDITURES OF $554,000 FOR CONSTRUCTING A CITY-OWNED CONDUIT SYSTEM TO INCENTIVIZE THE PROVISION OF NEXT GENERATION FIBER OPTIC TELECOMMUNICATION FACILITIES BY THE PRIVATE SECTOR WITHIN THE URBAN RENEWAL DISTRICT. WHEREAS, on June 1, 2015, the North 7th Urban Renewal District (the District ) presented their annual work-plan report and budget request for Fiscal Year 2016 to the City Commission; and WHEREAS, the City Commission exercises its authority to adopt budgets and authorize expenditures for the District in accordance with Montana Code Annotated 7-15-4281; and WHEREAS, the City Commission did, on the 23rd day of June, 2015, after due and proper legal notice conduct a public hearing on and adopt Resolution No. 4602 - A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF BOZEMAN, MONTANA, APPROPRIATING FUNDS FOR VARIOUS BUDGET UNITS, AND FURTHER ESTIMATING REVENUE NECESSARY TO OPERATE AND MAINTAIN SERVICES OF MUNICIPAL GOVERNMENT FOR THE FISCAL YEAR ENDING JUNE 30, 2016; and WHEREAS, on December 3, 2015 the District approved a motion to amend the work-plan and budget to include $554,000 for constructing a City-owned conduit system to incentivize the provision of next generation fiber optic telecommunication facilities by the private sector within the urban renewal district; and 89 Resolution 4644, Amending Fiscal Year 2016 (FY16) North 7TH Tax Increment Finance District Fund Budget Page 2 of 3 WHEREAS, the North 7th Tax Increment Finance District Special Revenue Funds are to be expended on projects included in the North 7th Urban Renewal District’s work-plan, to benefit the District; and WHEREAS, the City Commission did, on the 14 day of December, 2015, after due and proper legal notice, conduct a public hearing on the proposed budget amendments. NOW, THEREFORE, BE IT RESOLVED by the City Commission of the City of Bozeman, Montana, to wit: Section 1 – Appropriation Additions The City Commission of the City of Bozeman, Montana, does hereby authorize additional expenditures within the North 7th Tax Increment District Fund in Fiscal Year 2015 in the following amounts: North 7th Tax Increment District Fund - 143: Construction of a City-owned telecommunications conduit system $554,000 GRAND TOTAL – Additional Appropriations $ 554,000 Section 2 – Use of Fund Reserves The increased appropriations shall be funded from un-used cash reserves in the North 7th Tax Increment District Fund. Amended appropriations include capital carry-over items from FY15, in accordance with Resolution No. 4602. Current Beginning and Ending Reserves estimates are as follows Beginning FY16 Estimated Revenues Amended Appropriations Amended FY16 Ending Balance $2,045,705 $728,013 $1,654,980 $1,118,738 Section 3 Pursuant to Section 7-6-4030, M.C.A., this resolution, upon its passage, shall be in full force and effect on July 1, 2014. Section 4 That should it be found by any court of competent jurisdiction that any section, clause, portion, sentence, word, or phrase of this resolution is deemed to be contrary to any existing law or regulations, that in this instance, it is the intent of the City Commission of the City of Bozeman, Montana, that all other portions, sections, words, clauses, phrases, or paragraphs of this document shall remain in full force and effect. 90 Resolution 4644, Amending Fiscal Year 2016 (FY16) North 7TH Tax Increment Finance District Fund Budget Page 3 of 3 PASSED AND APPROVED by the City Commission of the City of Bozeman, Montana, at a regular session thereof held on the 14th day of December, 2015. ________________________________________ JEFFREY K. KRAUSS Mayor ATTEST: _____________________________________ STACY ULMEN, CMC City Clerk APPROVED AS TO FORM: ________________________________________ GREG SULLIVAN City Attorney 91 92 93