Kalispell City Council voted, 8-1, Monday night to impose transportation impact fees after two years of debate and deliberation. The decision left many in the business community, which opposed the fees, disappointed, while supporters of the fees indicated the council had reached about as workable a compromise as possible.
It was a surprising outcome to the meeting, in that many council members made remarks to the effect that the adoption of impact fees should be put on hold until the economy improves, and a motion by Councilman Tim Kluesner to table the fees for two years failed narrowly, 5-4.
Mayor Pam Kennedy, Councilwoman Kari Gabriel and Councilman Duane Larson joined Kluesner in voting to table the adoption of the impact fees.
“I know we’ve spent two years on this but we’ve found many flaws,” Kennedy said. “I think we need some time to work on it and I think we need some time for the economy to recover.”
But when it was clear there weren’t enough votes to table the fees, Larson, Gabriel and Kennedy then voted in favor of adopting the traffic impact fees at 75 percent of the scheduled rate for any new construction that applies for a building permit within two years. Kluesner was the sole dissenting vote on that key decision.
Earlier in the meeting, the council decided on a 7-2 vote to cut in half the list of road improvement projects to be funded by the traffic impact fees, from 10 projects costing $12.4 million down to five projects with a growth-related cost of $6.3 million. Councilmen Jim Atkinson and Randy Kenyon opposed making the cuts to the road improvement projects. An ordinance to clarify how improvements developers already make to roads and city infrastructure would offset the amount of impact fees they are required to pay passed unanimously.
Transportation impact fees are designed to help pay for the road and infrastructure improvements necessitated by increased traffic from new development by assessing a fee on those new homes and commercial centers based on how much traffic they would generate. As it currently stands, the council’s decision slashed the proposed transportation impact fees in half by reducing the projects they would be required to help pay for, then added an additional 25 percent discount to any new construction that gets under way in the next two years.
But after the meeting adjourned, a disappointed Ken Kalvig, the local attorney for Wolford Development, which plans to build the Glacier Town Center, said it was impossible to calculate how much Wolford would be required to pay in road impact fees for the proposed shopping center under the plan Kalispell had just adopted, with estimates varying by millions of dollars.
“How am I supposed to analyze what they did tonight?” Kalvig asked. “I still don’t know how they’re going to calculate our impact fees, and frankly, they don’t know how to calculate our impact fees.”
There exists a “high” likelihood of legal action against the city by some members of the development community over the newly adopted impact fees, Kalvig said, adding that it’s also unclear if and when the Wolford project – which has been on hold – will break ground.
Mayre Flowers, executive director of Citizens for a Better Flathead, which has supported the full adoption of the fees, praised the council despite the cuts it made.
“It was the best compromise that was possible given the divisiveness of this issue – it moves us forward with a tool that, as the economy improves, the tool can be strengthened,” Flowers said. “It’s definitely a much stronger compromise than we would have supported, but that’s what the council is elected to do.”
At the meeting’s end, Kennedy characterized the transportation impact fee decision as one of the hardest in her career as mayor, and emphasized that the council can revisit that decision any time in the future to make changes as it grows clearer what effect the new policy will have.
“This has been heart-wrenching,” Kennedy said. “We hope that we came to a compromise that is reasonable and is one that will help the city of Kalispell continue to flourish.”
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