Planning staff in coordination with Engineering Division staff recommends to the City Council approval of this request to amend The Timbers Subdivision, 1st Filing, Subdivision Improvement Agreement (SIA). The SIA language amendment will allow for the phasing of improvements for Sugar Pine Road, Olive Lane and Georgia Pine Road. 

David Mitchell, developer, applied for an amendment to the Subdivision Improvement Agreement (SIA) to include language which would allow the phasing of construction and creation of a Special Improvement Districts (SID) in relation to the construction of Sugar Pine Road, Olive Lane and Georgia Pine Road in the preliminarily approved The Timbers Subdivision, 1st Filing.  The applicant has indicated there are significant costs associated with this connection therefore they would like to propose completing the roads by phasing the improvement and utilizing an SID to finance the improvements. This means the construction of the phased improvements will still occur, just not immediately and the applicant will be able to reach final plat approval without the construction being complete.  Other notable information includes the requirement that the developer contribute to the SID(s) financially at an amount not less than 50% of the costs associated with the improvement. The remaining costs will be allocated to lots benefiting from the improvements. In addition, the lots proposed to be encumbered by the phasing requires a Restriction of Transfers and Conveyances of those lots which prevents the sale of those lots until the District is created. This will be filed with the Clerk and Recorder with final plat. Upon completion of the improvements or creation of the district(s), the restriction on transfers and conveyances will be lifted, and the lots can be sold.   

While an SID method is allowable, there are some cons as opposed to when the developer builds the improvement without this tool. In regard to the SIDs, these can happen one of two ways. The developer may create the SIDs while holding all of the lots, however, most lending institutions want the SID's paid off before the lot is conveyed, therefore, the developer would still bear this cost which they are trying to avoid. Additionally, if the construction didn't occur until lots were sold, even though waivers of protest are collected for the creation of SID's at the time of subdivision, the reality is it makes all of the property owners pay for the cost of the connection instead of the developer and it creates a significant amount of angst by the property owners. Lastly, when roads are not constructed at the time of development, adjacent property owners tend to utilize the space for storage or other uses which also creates difficulty when constructing right of way improvements after the fact.

Fortunately, the proposed SIA amendments creates a situation where many of these cons should be avoided. In this case, the Developer is required to create the district and financially participate. In addition, the lots will be encumbered and unable to be sold until the district(s) are created. This solution does not prevent or slow down the ability to obtain final plat approval which is a benefit to the developer. Since the SIA is binding there is contractual agreement between the City and Developer which elevates the ability to enforce construction of the improvement, so the development will continue to be in accordance with the City of Billings Subdivision Regulations.

Staff is recommending approval of this request. Phasing improvements does not create any conflicts with the City of Billings adopted Subdivision Regulations or the existing preliminary plat approval, nor does it put the City in a position where the roads would not be constructed. For these reasons, City staff is forwarding a recommendation of approval of the SIA wording change to the City Council.
 

City Council may:

• Approve; or,
• Not Approve the requested amendments to the Subdivision Improvement Agreement.

Not approving the amendment will require the developer to construct all roads or financially guarantee them through a bond or letter of credit prior to obtaining final plat approval for The Timbers Subdivision, 1st Filing in accordance with its existing preliminary plat approvals.

This SIA amendment will not have any fiscal effect on the Planning Division.