This is a zone change request from Planned Development – Residential Multi-family-Restricted (PD-RMF-R) to Planned Development – Neighborhood Commercial (PD-NC). The existing zoning also allows the location of a church as an allowed use in addition to the residential use.  The application is for a 45,950 square foot parcel of land described as Lot 2, Block 28, Harvest Subdivision, 3rd Filing located generally at 3225 Rosebud Drive. The property is a unit-ownership parcel that includes 15 residential units and the now-vacant church/day care. The vacant structure is owned by Stockman Bank. The residential owners are Terry Havener, Susan Havener, Brittany Evans, Kimberly Erbacher, John Erbacher, Folmer Christensen, and Mari Christensen. The agents are R.L. McComish and Sanderson Stewart representing the potential purchasers of the Stockman Bank unit. The intent of the purchasers is to establish a Pickle Barrel restaurant. The agents and owner conducted a pre-application neighborhood meeting on September 24, 2012. A preliminary review meeting was held by city staff on October 29, 2012. The Zoning Commission granted the applicant a 30-day delay of the public hearing on November 7, 2012. The applicant was preparing a detailed traffic study for the adjacent streets and intersections. The Zoning Commission conducted a public hearing December 4, 2012, and is forwarding a recommendation of approval on a 3-0-1 vote.

State law at Section 76-2-304, MCA, requires that all zone changes be reviewed in accordance with 10 criteria. Using the 10 criteria to determine the appropriateness of the zone change request, the City Council may:

1. Approve the zone change request
2. Deny the zone change request
3. Allow withdrawal of the application
4. Delay action for up to thirty (30) days

The City may realize additional tax revenue if the existing vacant building is renovated. The City fees assigned to the property will be increased from the rate charged for residential to a rate charged for commercial property.

The applicant is requesting to change the Planned Development zoning from residential multi-family with an allowance for a church to NC to allow the vacant church/daycare to be re-used for a restaurant. The vacant building is owned by Stockman Bank after a default on the loan by the previous owner, Don Hanser. The building has been vacant for over 3 years. The property is a unit ownership but all parties have agreed to the zone change application. Zoning districts generally follow platted lot lines so the underlying zoning applies to the entire lot, not individual units in a unit ownership. The applicant intends to remodel the vacant building if the zoning is approved.

Site development improvements will be necessary to meet off-street parking requirements and accessibility standards. The new restaurant will have approximately 2,000 square feet of floor area and an outdoor dining area on the east side of the building. Neighborhood Commercial uses range from offices, to retail, to services such as banks, medical clinics and similar businesses. It also includes uses such as gas stations, convenience food stores, and other uses designed to provide services to larger residential neighborhoods as well as residential multi-family dwellings. The current zoning allows the vacant building to be used as either a church or a day care center. Any re-use of the building will require remodeling and updating.  

Each Planned Development zone may designate underlying zoning and may also adjust the uses, setbacks, lot area requirements and building heights within those underlying zones. For example, the underlying RMF-R zone for this lot requires only 1,900 square feet of lot area for each dwelling unit. This could allow up to 23 dwelling units per acre of land in any type of configuration (single, duplex or multi-family). The standard RMF-R zone requires 6,000 square feet for each single dwelling unit, 7,000 square feet for each duplex and 8,500 square feet for each 3-plex. For buildings with more than 3 units, an additional 1,500 square feet is required for each added unit – e.g. a 4-plex requires 10,000 square feet. In the Harvest PD Agreement, Block 28 (includes Lots 1 and 2) up to 102 dwelling units are allowed. The Timbers Townhomes to the west has 68 dwelling units and the Rose has 15 dwelling units for a total of 83 dwelling units on this block. 

In 2002, the City Council approved the re-use of the church building for a day care center. The day care center operated until early 2009. In 2006, the average daily traffic on 32nd Street West between Henesta and Rosebud Drive was 9,852 vehicle trips per day. This traffic count was conducted just prior to the completion of 32nd Street West as a full arterial street from Rimrock Road to Hesper Road. The completion of 32nd Street West north of Broadwater increased the average daily traffic from 9,852 vehicle trips per day in 2006 to 16,671 vehicle trips per day in 2012, a 69% increase in average daily traffic in a 6-year period. The impact of increased traffic has resulted in a much lower level of service at the intersections of Henesta and Rosebud with 32nd Street West. Traffic turning left on to King Ave West from southbound traffic on 32nd Street West is typically stacked to the intersection with Henesta Drive. During peak hours, traffic waiting to turn left on King Avenue West will stack in the center turn lane up to the intersection of Rosebud Drive and 32nd Street West, a distance of 500 feet north of the signal.

The afternoon hours are the peak hours for traffic and the average is 1,200 vehicles per hour between noon and 5 pm. The waiting time for traffic to enter South 32nd Street West from any of the stop-sign controlled intersections or driveways in this area is increased during these peak hours. The applicant conducted a traffic analysis of the intersection of Rosebud Drive and South 32nd Street West. The traffic analysis indicates the intersection operates at a Level of Service (LOS) of "F" during the peak traffic hours at noon and 5 pm. An LOS rating of "F" indicates there are long wait times at this intersection during peak hours. A LOS of "F" typically means the traffic control and the capacity of the intersection has failed. The traffic analysis report is included as an attachment.

The Pickle Barrel will add traffic to Rosebud Drive and 32nd Street West. The estimated traffic increase is 130 trips per 1,000 square feet of restaurant area but could be as high as 700 trips per 1,000 square feet. The applicant estimates the floor area for the restaurant will be 2,000 square feet resulting in an additional 260 to 1,400 vehicle trips per day, mostly during peak hours for traffic on 32nd Street West. The former day care center generated about 80 trips per 1,000 square feet of floor area or about 280 trips per day at maximum floor area of 3,500 square feet. By comparison, the Holiday gas station, convenience store and car wash generates on average 1,240 vehicle trips per day. The actual traffic at the Holiday gas station may be higher since it typically sells the lowest priced gas in the city, attracting traffic from out of the area. Each multi-family residential unit in the area contributes on average 8 vehicle trips per day. The three unit ownership developments in the immediate neighborhood west of 32nd Street West generate 920 vehicle trips per day. Big Sky Elementary generates about 1,305 vehicle trips per day. The traffic analysis submitted by the applicant estimates the additional traffic from the Pickle Barrel restaurant will generate 75 additional trips during the noon peak hour and 21 additional trips during the evening peak hour.

The applicant conducted a pre-application neighborhood meeting on September 24, 2012, and several surrounding property owners attended the meeting. A synopsis of the meeting was provided and is included as an attachment. The notes state approximately 9 surrounding owners attended and voiced concerns with off-street parking for the restaurant and with existing traffic congestion on 32nd Street West. The notes state the agent received 4 phone calls from owners who could not attend the pre-application meeting. Three were supportive and 1 was opposed to the zone change.

City staff conducted a preliminary meeting on October 29, 2012 with staff, surrounding owners and the applicant. Two surrounding owners attended the meeting as well as City Traffic Engineer Terry Smith and Wayne Ware, Senior Engineering Technician. The discussion of the proposal concerned traffic and off-street parking. The applicant and agent indicated a traffic analysis of the Rosebud Drive intersection with 32nd Street West was in preparation but not yet completed. The impact of new traffic from the restaurant could not be evaluated at this time without the completion of the study. Information from surrounding owners indicated that traffic stacking in the north bound lane of 32nd Street from the signalized intersection with Monad Road also occurs most afternoons. The owners stated the traffic will stack south to the intersection with Granger Avenue East.

The agent stated solutions to existing traffic congestion on 32nd Street West could include adding a left turn lane at King Avenue West, a signal at Rosebud Drive, a round-a-bout at King Avenue West or Rosebud Drive, re-arranging the internal circulation of the parking lot or adding a new drive approach from the property out to 32nd Street West. City staff indicated they would not support a new signal at Rosebud or a new drive approach on to 32nd Street West. Staff pointed out any new parking space in the arterial setback (50 feet from the center of 32nd Street West) could not be counted toward the minimum required for the residences and the new restaurant. The agent indicated the existing parking lot has more than the minimum required so any additional spaces would be above the requirement. Planning staff asked the agent to study where the solid waste collection and storage would be located for the restaurant. This location may cause the loss of 1 or more parking spaces.

Staff indicated a concern the proposed location may not be the most appropriate for a new restaurant given the traffic congestion and proximity to a densely developed neighborhood. The applicant stated the location would be good for the neighborhoods to provide a walkable location to a restaurant for everyone. The applicant stated the proposed zoning and the restaurant is supported by the growth policy because it is on an arterial street near the intersection of two arterial streets. One of the surrounding owners indicated the neighborhood is not very walkable since there are no sidewalks except for right around the school on Granger Avenue East.

The Planning staff received several petitions and letters from surrounding owners opposed to the zone change. Planning staff received two letters of support. These are all included in an attachment.

The Zoning Commission conducted a public hearing on December 4, 2012 and received the staff report, recommendation, and testimony from the applicant and agents for the zone change. The Zoning Commission also received testimony from 2 property owners in opposition to the zone change. 

Planning staff presented the report and recommendation. Zoning Coordinator, Nicole Cromwell, stated the Traffic Impact Study (TIS) was reviewed with the applicant's agent, Transportation Planner Scott Walker, and City Traffic Engineer Terry Smith on December 3, 2012. She stated the analysis was accurate according to all parties but the Planning and Engineering staff could not support the zone change to NC. The staff is concerned with the existing traffic LOS "F" and the long wait times for traffic particularly at the evening peak hour. Staff stated the wait times predicted at the Rosebud Drive intersection approach 13 minutes. Staff believes actual wait times may be lower due to the volume of traffic using the parking lane to make right turns on to South 32nd Street West. Discounting some of the traffic volume for right turns would reduce the wait time at the intersection to 6 or 7 minutes. This wait time still puts the intersection at a LOS of "F". Staff stated the City has no current or proposed traffic mitigation project for this arterial corridor.

Rick Leuthold of Sanderson Stewart presented testimony in favor of the application. Mr. Leuthold stated the traffic analysis indicated an existing problem but he pointed out any re-use of the vacant building would impact this intersection. He stated a re-use by a day care center, an allowed use, may have a greater traffic impact than the proposed Pickle Barrel restaurant.  Mr. Leuthold said the project has been interesting. He stated he has been involved with the site since the church was there and when the property was purchased and housing development started. The subject property was a daycare for some years and since then Stockman Bank has owned the site and has been looking for a new tenant/buyer. He stated the bank only received inquiries from day care providers but did not move forward. He stated the Pickle Barrel was looking for new site after the 13th Street West site closed. He stated the owner rated this location as its top site.

He stated any solution to the traffic situation at Rosebud Drive will involve a much larger area including the traffic signals at King Avenue West and Monad Road at the least. Mr. Leuthold stated the City has been aware of the 32nd Street signal timing issues but does not have a project in the Capital Improvement Program (CIP) to rectify the problem. He stated two alternatives for the Rosebud Drive intersection were proposed in the traffic study, but neither are acceptable to the City. He stated allowed uses on the property would also add as much or more traffic than the proposed use for a restaurant.

City Traffic Engineer Terry Smith, provided clarification on his recommendation to deny the zone change. He stated the City is concerned about protecting the 32nd Street West corridor from strip commercial zoning and from adding traffic control signals that are not adequately spaced. He stated traffic issues on other major arterial corridors such as Grand Avenue and 24th Street West are the combined effect of strip zoning and installing traffic signals closer than necessary. He stated the existing problem should be addressed before additional commercial uses are added to the corridor. He stated the accident rate at Rosebud is not increasing and the City recently allowed additional access on to King Avenue West to relieve some of the traffic conflicts at Henesta and 32nd Street West.

Richard McComish, the agent for the Pickle Barrel restaurant, testified in favor of the application. He stated he owns ECI which employs about 135 people in Billings. He stated he is a community-oriented businessman who is in favor of providing good jobs and services in the community. He stated community is important to his business and his family. Mr. McComish stated when he met with the staff on this, he heard about the traffic problem. He stated 32nd Street West is a major corridor. He asked Sanderson Stewart to conduct the traffic analysis, although this is not required. He stated as an engineer by training, it was important to have accurate data before concluding there is a problem or working on solutions. There are other commercially-zoned lots to be developed in the area. He stated he does not pursue a development on a lark and is always prepared to do things right and move forward. He stated the restaurant franchise chose the site and he has been diligently pursuing the zone change. He stated he is concerned that the basis for denial is traffic, but allowed uses can generate a lot of traffic now. He stated the City's master plan and policies support nodal development in this area and the proposed zone change and restaurant will contribute to achieving the goals of the master plan.

George Warmer of 2608 Highwood Drive, and a principal in Coldwell Banker Commercial, stated the property has been listed for sale for more than 2 years. It has stayed on the market because of the limited uses for the property. He stated the Pickle Barrel project came to with a plan and investment in the process. He said he sees this (use) as an attractive solution to this location. He stated the Pickle Barrel will be similar to other neighborhood services such as Great Harvest on Poly or Harper-Madison on 10th Avenue North. Mr. Warmer presented a letter from Dale Davis of Myrtle Drive. Mr. Warmer stated Mr. Davis could not attend the hearing but wanted his support of the project on the record. 

Tim Ludewig of Stockman Bank, representing the unit owner testifed in favor of the application. He stated that allowed uses or the sandwich shop are the best uses for this location. Any of the uses will impact traffic. He stated considering length of time the City may need to address traffic, a reasonable plan is to put the building back into use knowing what we know right now.

Gayle Ziech of 625 Chokecherry Place testified in opposition to the zone change. She stated the City has effectively condemned her property by completing the 32nd Street West connection to Zimmerman Trail. She stated a restaurant will add even more traffic and traffic noise to her back yard. She stated she can no longer use her back yard at all. She stated the traffic is so loud you cannot carry on a normal conversation outside her back door. She stated she has a letter from the Montana Department of Transportation stating the City has condemned her property by not installing a proper sound barrier along 32nd Street West. Chairman Dailey asked Ms. Ziech if she had a copy of this letter to provide to the City. She stated she did not have a copy with her at the hearing.

Brittany Evans, a unit owner in Rosebud Condominiums, testified in opposition. She stated she did sign the zone change application to allow the Pickle Barrel to try and re-zone the property however, in the last few weeks, she has changed her mind based on research she has done. She stated her primary concern was the increase in the fees she will have to pay the City for arterial streets and storm sewer. She stated she is very concerned with the loss of market value of her condominium unit if a busy restaurant is located across the driveway.

Mr. Leuthold provided rebuttal of the testimony in opposition. Mr. Leuthold stated the condominium documents will need to be revised to accommodate the new restaurant. He stated the restaurant owner is willing to pick up all the additional fees, and take over maintenance of the parking lot and driveways. He stated the restaurant will work with all the unit owners to buffer the use from the residential units, including elevation treatments on the building, lighting, noise and other issues between the unit owners. He stated again that any re-use of the building will bring added traffic to 32nd Street West. The potential traffic impact for this use would be no greater and in some cases less than any allowed use. He stated the traffic issue should not be the sole issue to prevent a zone change.

The public hearing was closed. Commission member Mike Boyett made a motion to recommend approval of the zone change and the motion was seconded by member Bill Ryan. Mr. Ryan stated the traffic problem already exists and the proposed zone change and re-use of the building will not have any greater traffic impact than the existing allowed uses. He stated the City should work on the traffic issues separately. Mr. Boyett stated he does not believe penalizing this owner for an existing traffic problem is appropriate. Chairman Dailey stated the City should take the initiative to study and upgrade the signal timing in this corridor so the traffic burden on Rosebud and Henesta can be relieved. The Commission voted 3 in favor, none opposed, and 1 abstaining on the motion to recommend approval. Member Barbara Hawkins abstained due to a conflict of interest as she and her husband own adjoining property.
 

The Planning Division reviewed the application and the traffic analysis, and recommended denial of the proposed change to the Planned Development agreement. The recommendation is based on the attached ten (10) criteria for zone changes. The City Traffic Engineer, H. Terry Smith, also reviewed the traffic analysis and recommended denial to the Zoning Commission. Mr. Smith's memo is included as an attachment. The subject property is adjacent to dense residential development to the north and west, and across the street from PD-NC zoning for the Holiday gas station. Zoning across 32nd Street West is lower density residential and some of this property remains undeveloped. The 2008 Growth Policy encourages predictable land use decisions that are consistent with neighborhood character and land use patterns. The original zoning for the property is appropriate. The proposed zoning would extend commercial zoning along an arterial street that is already strained by traffic congestion. While some pedestrian access of the location can be expected, the majority will be additional vehicle traffic turning into and out of Rosebud Drive. The peak time period for restaurant service is also the peak time period for traffic on 32nd Street West. 

The Zoning Commission did not concur with the staff recommendation and analysis of the ten (10) criteria for zone changes. The Zoning Commission determined the impact to the existing traffic problem at Rosebud Drive and 32nd Street West would be no greater than one of the allowed uses under the existing zoning. The Zoning Commission believes this owner should not be held accountable for an existing problem the City needs to address, regardless of the zoning on this property or the use of the vacant building. The Zoning Commission determined the general welfare of the neighborhood would benefit from the re-use of a vacant and decaying building, and the benefit would be greater than any potential detriment to the traffic situation on Rosebud Drive. The Zoning Commission is forwarding a recommendation of approval on a 3-0-1 vote.

Prior to any making a decision on the proposed zone change, the City Council shall consider the following 10 criteria:

1. Is the new zoning designed in accordance with the Growth Policy?
The proposed zone change is consistent with the following goals of the Growth Policy:
• Predictable land use decisions that are consistent with neighborhood character and land use patterns. (Land Use Element Goal, page 6) 
The proposed zoning would permit the proposed restaurant to be located directly adjacent to the existing multi-family dwellings on the site. The surrounding neighborhood character is primarily higher density residential uses to the north and west and lower density residential uses to the east. The proposed zoning would allow the vacant building to be re-used as a neighborhood service business such as the proposed restaurant. This is consistent with the character and pattern of this area. 
• New developments that are sensitive to and compatible with the character of adjacent City neighborhoods. (Land Use Goal, page 6)
The proposed Planned Development zone change to NC could allow additional commercial uses north of Rosebud Drive. The proposed zoning is compatible with the adjacent neighborhood. While the proposed use will add traffic to the intersection with Rosebud Drive and 32nd Street West, so would all the current allowed uses for a church, a day care center, or multi-family dwellings. The proposed zoning is sensitive to and compatible with the character of the neighborhood.  

2. Is the new zoning designed to secure from fire and other dangers?
The new zoning requires minimum setbacks, open and landscaped areas and building separations. The new zoning, as do all zoning districts, provides adequate building separations and density limits to provide security from fire and other dangers.

3. Whether the new zoning will promote public health, public safety, and general welfare?
Public health, safety, and general welfare will not be compromised by the proposed zoning. The existing traffic congestion on Rosebud and 32nd Street West would be impacted by any re-use of the vacant building, regardless of the underlying zoning district. Re-use of the vacant and decaying building will benefit the general welfare of the neighborhood. 

4. Will the new zoning facilitate the adequate provision of transportation, water, sewerage, schools, parks and other public requirement?
Transportation: The re-use of the vacant building will have an impact on the surrounding streets. The proposed re-use under the NC zoning will have no greater impact than potential uses allowed by the current zoning. A traffic impact study was conducted, and although the City Traffic Engineer recommended denial of the zone change, resolving the existing problem at the intersection should not be shouldered by one owner.
Water and Sewer: The City provides water and sewer to the property.  
Schools and Parks: There should not be any impact to schools or parks from the proposed zone change.
Fire and Police: The subject property is currently served by the City Public Safety Services.

5. Will the new zoning provide adequate light and air?
The proposed zoning provides for sufficient setbacks to allow for adequate separation between structures and adequate light and air.

6. Will the new zoning effect motorized and non-motorized transportation?
Traffic generation from a commercial site is dependent on the specific uses within the development. The site is currently developed with 15 dwelling units and has one vacant church/daycare. Re-use of the existing structure for a daycare or church will generate traffic. These uses are allowed by the current zoning. The proposed zoning of PD-NC will allow commercial re-use of the vacant structure or demolition and construction of a new commercial building. The proposed use, a restaurant, will generate an additional 75 trips through the intersection during the noon peak hour and 21 trips at the evening peak hour. The proposed use and zoning should place no greater burden at the intersection than any of the allowed uses. Residents in the area report avoiding the intersection of Rosebud Drive and 32nd Street West during peak hours (noon to 5 pm on weekdays) and having to perform “stunt” driving at other times to turn left (to head north) out of Rosebud Drive. Despite the traffic congestions, the accidents reported at this intersection are no greater than similar intersections in Billings (7 over a period of 3 years). 

7. Will the new zoning promote compatible urban growth?
The new zoning does promote compatibility with urban growth. The existing vacant structure can be re-used for a church or a day care. The existing building can be demolished and new multi-family dwelling units constructed. The proposed zoning would allow the re-use of the building for a neighborhood service provider such as the proposed restaurant. The existing and proposed zoning is compatible with urban growth. 

8. Does the new zoning consider the character of the district and the peculiar suitability of the property for particular uses?
The proposed zoning does consider the character of the district and the suitability of the property for commercial uses. The property is suitable for commercial uses such as the proposed restaurant. 

9. Will the new zoning conserve the value of buildings?
The new zoning does conserve the value of the vacant structure. The re-use of the building for a restaurant will require significant rehabilitation. Surrounding building values may increase if the structure is occupied. The market value effect on the adjacent residential units within the unit-owned property is not predictable.

10. Will the new zoning encourage the most appropriate use of land throughout the City of Billings?
The proposed zoning does encourage the most appropriate use of the land. Appropriate uses may include the existing zoned uses as well as uses allowed in the PD-NC zone such as the proposed restaurant.