The Kalispell City Council voted 5-3 Monday to repeal transportation impact fees and reimburse more than $140,000 to businesses that paid into the program over the last two years.
After more than two hours of impassioned public comment from both sides of the divisive issue, Mayor Tammi Fisher and Councilors Phil Guiffrida III, Tim Kluesner, Kari Gabriel and Jeff Zauner voted in favor of a resolution to scrap the transportation impact fee program, which helped pay for additional road space when new development occurred. Councilors Jim Atkinson, Randy Kenyon and Bob Hafferman voted against the resolution. Councilor Wayne Saverud was not present.
The decision was a victory for developers who have claimed that the fees were unfair. Proponents of the program have argued that without the program citywide taxpayers would be forced to carry a heavier burden when it comes to paying for growth.
In a last ditch effort to temporarily save the impact fee program, Atkinson proposed either tabling the decision for two weeks or suspending the fees for six months. But both motions failed to garner majority support after councilors and the mayor maintained the program was faulty beyond repair.
“The system doesn’t work,” Fisher said. “I’m not going to leave our community hanging where all of this goes on the residential homeowners’ backs. That’s not fair at all. But it’s not fair that it goes on the developers’ backs either.”
On Tuesday, the four citizen members serving on the city’s five-person Impact Fee Committee, including the chairperson, submitted their resignations, according to Karlene Kohr, the committee chairperson.
The council’s decision to rebuff the committee’s unanimous recommendation to keep the program intact led to the resignations, Kohr said.
“This is just a really sad day,” she said. “There’s no rational way you can explain (the council’s) decision. It seems so arbitrary, so irresponsible and so biased.”
Kalispell enacted the transportation impact fee program in the spring of 2009 after hiring an engineering firm in 2005 to begin developing a report to guide the program. The city paid $34,491 leading up to the fees’ implementation.
Since 2009, the program has collected $143,702. New development was scheduled to pay an additional $111,000 into the fund in the coming weeks, according to Terri Loudermilk, the budget resources manager for the city’s Public Works Department.
Chad Graham, a local developer and a member of the city’s planning board, has been an outspoken critic of the transportation impact fees, saying they stand in the way of new growth. Graham argued that the city would benefit far greater from new businesses paying property taxes.
“Businesses are taxpayers,” he said. “They’re the largest taxpayers in the city.”
The council will discuss the details of the reimbursement process at a future meeting. State law says that the current owner of the property that paid into the impact fee program will receive the refund, Loudermilk said.
The question still remains of exactly how the city will solve congestion issues that accompany new development. Guiffrida, who initiated the process of removing the transportation impact fees last month, said discussions are happening “behind the scenes” and alternatives will begin to materialize in the near future.
After the three-hour meeting inside City Hall, Atkinson expressed concern over the ramifications of the council’s decision. He said he understood that businesses felt they could not afford the impact fees, but the same could be said for city homeowners.
“When the roads break down,” he said, “we’re just going to live with it for a while evidently.”