This is a zone change request from Community Commercial (CC) to Highway Commercial (HC) on two parcels of land described as Lots 1 through 17, Block 14 of Suburban Subdivision located at 327 Cook Avenue and 3919 Montana Avenue. The total area of both parcels is 65,175 square feet. Both of the parcels have existing commercial development. The parcel at address 3919 Montana Avenue has a vacant welding and machine shop. That property is owned by Gene and April Staudinger.  The property at 327 Cook Avenue is owned by Mike D. Dimich Sons.  Mike Dimich is the contract purchaser of 3919 Montana Avenue.  The owners are represented by Michael Dockery of Crowley Fleck, PLLP. The owners conducted a pre-application neighborhood meeting on February 24, 2011, at the First Interstate Bank at 401 North 31st Street. The pre-application meeting notes are included as Attachment C. The Zoning Commission conducted a public hearing on April 5, 2011, and is forwarding a recommendation of approval on a 3-0 vote.

State law at MCA 76-2-304 requires that all zone changes be reviewed in accordance with 12 criteria. Using the 12 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

Approval of the requested zone change will enhance the value of the property, which may increase property tax revenue when improvements are made to the existing and new buildings.

The applicants are requesting to rezone this property to bring the current and proposed uses of the property into conformance with the zoning. The property is owned by Mike Dimich Sons and by Gene and April Staudinger. Mike Dimich Sons intends to consolidate and redevelop the site for Pepsi operations. The lots north of the alley are currently zoned HC and have been the main location of Pepsi since 1954 (344 Howard Avenue).  This application would change the zoning to HC for the lots that are south of the alley.  Beverage bottling, wholesale distribution and warehousing are special review uses in the HC zone but  those uses are not allowed in the current CC zone. Pepsi received a special review approval for the lots north of the alley in 1982 (SR #146). The existing Pepsi operation at 327 Cook Avenue is a legal nonconforming use of property in the CC zoning district. If the new zoning is approved, a special review for the existing Pepsi operation will not be required unless an expansion of the operation is greater than 10% of the existing gross floor area.

Montana Avenue is a 5-lane principal arterial street and at this location has a center turn lane to allow left turns for east bound traffic. The average daily traffic on this part of Montana Avenue is approximately 23,180 vehicle trips per day. The new zoning will not increase traffic on Montana Avenue or on Cook Avenue since Pepsi operations already exist at this location and any new development will occur to better accommodate the existing business.

The new zoning will not require any site improvements. If re-development does occur, it will be evaluated based on criteria in the zoning code, the site development code and the building code. Any right-of-way improvements, site improvements and new buildings or paving will need to meet existing codes.

The applicant conducted a pre-application neighborhood meeting on February 24, 2011. No surrounding property owners attended the meeting. No surrounding property owners contacted the Planning Division staff prior to the Zoning Commission public hearing.

The 2008 Growth Policy encourages in-fill development and retention of existing businesses in areas where infrastructure exists to support those uses. The proposed HC zoning fits with the goals of the policy. Potential uses and existing uses in the HC zone are generally compatible with the zoning and uses directly adjacent to the property.

The Planning Division reviewed the application and recommended approval based on the attached twelve (12) criteria for zone changes. The subject property is adjacent to HC zoning and CI zoning and no changes in the character of the property are predicted in the near future. The uses allowed within the proposed HC zoning are compatible with the surrounding zoning and neighborhood character. Any re-development of the property requires compliance with the new zoning and the ability to meet site development code and traffic safety standards. The 2008 Growth Policy encourages predictable land use decisions that are consistent with neighborhood character and land use patterns. The existing use and proposed zoning are consistent with this neighborhood and land use pattern. The Zoning Commission conducted a public hearing on April 5, 2011, and concurred with the Planning Division recommendation.

The Zoning Commission conducted a public hearing on April 5, 2011, and received testimony from the applicant, Bill Dimich and the agent Michael Dockery of Crowley Fleck.

Mr. Dockery explained the need for the application to bring the existing Pepsi operation on the west half of the property in to conformance with zoning and to complete the proposed sale of the Staudinger property to the Pepsi company. The Pepsi company has been in operation at this location since 1954 and would like to optimize it's operations at this location rather than building on a new site further from the center of the city. Mr. Dockery explained that any future improvements to the property will conform to city codes including zoning, building and site development. He noted the proposed zoning of Highway Commercial is consistent with the zoning to the north of the alley - the main Pepsi property - and to the east and west. He noted that Montana Avenue is a prinicipal arterial and can handle all the Pepsi traffic currently generated from the site. The new zoning will not generate additional traffic from the site since operations at Pepsi are expected to remain the same. He noted the proposed zoning will not be an additional burden to city services since all services to the property already exist including water, sewer, stormwater control, police and fire protection. Mr. Dockery noted the new zoning will be a benefit to the property and the area since Pepsi will likely remove the vacant dilapidated machine shop and build new improvements. 
Mr. Bill Dimich of 2917 Mohawk Drive and President of Pepsi operations in Billings requested support for the proposed zone change. He stated his company has been a strong presence and community supporter since 1954 and the zone change will enable Pepsi to remain in its current location for many years to come. 

Ther was no further public testimony. The Zoning Commission is forwarding a recommendation of approval and adoption of the 12 criteria for Zone Change #874 on a 3-0 vote.  

Prior to any action to approve or disapprove, the City Council will consider the recommendation of the Zoning Commission and shall consider the following:
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 existing Pepsi warehouse to continue and would allow the property at 3919 Montana Avenue to be re-developed compatible with the proposed zoning.
• Contiguous development focused in and around existing population centers(Land Use Element Goal, page 6)
The proposed zoning will permit the retention of an existing business along a major arterial street near downtown Billings.
• Coordinated economic development efforts that target business recruitment, retention, and expansion.(Economic Development Goal, page 6)
The proposed zoning will encourage the retention of an existing employer near existing population centers.

2. Is the new zoning designed to lessen congestion in the streets?
There should be no effect on traffic congestion. The existing property is primarily used by Pepsi for warehouse activity and traffic generation should not increase with the proposed zoning. The new zoning is intended to make the existing uses conform to zoning.

3. Will the new zoning secure safety from fire, panic and other dangers?
The subject property is currently serviced by all city services including police and fire. There should be no effect on these services.

4. Will the new zoning promote health and general welfare?
The proposed zoning would permit the existing use to continue and expand. The vacant machine shop at 3919 Montana could be re-purposed and the property cleaned up. This will promote the health and general welfare of the neighborhood.

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 prevent overcrowding of land?
The proposed zoning, like all zoning districts, contains limitations on the maximum percentage of the lot area that can be covered with structures. The proposed HC zone allows 75% lot coverage and the current CC zone allows up to 50% lot coverage. The proposed HC zone requires a separation between structures on the same lot, a minimum 20 foot front setback and a 10 foot side setback for any adjacent street. The HC and CC zones do not require a rear setback unless adjacent to a residential zone.

7. Will the new zoning avoid undue concentration of population?
The new zoning does avoid undue concentration of population. The existing zoning, CC, allows the same number of dwelling units as the proposed HC zoning. Both zoning districts allow single family, two family and multi-family dwellings and lot area requirements are based on the Residential Multi-family-Restricted zoning regulations. It is not likely the new zoning will result in any residential use of the property. The new zoning should avoid undue concentration of population.

8. Will the new zoning facilitate the adequate provisions of transportation, water, sewerage, schools, parks, fire, police, and other public requirements?
Transportation: The proposed zoning should not have any impact on the surrounding streets.
Water and Sewer: The City will be able to provide water and sewer to the property through existing lines.
Schools and Parks: There should be no impact to schools or parks from the proposed zone change.
Fire and Police: The subject property is currently served by city fire and police. There should be no impact to these services from the new zoning.

9. Does the new zoning give reasonable consideration to the character of the district?
The proposed zoning will allow the existing development to continue as a conforming use in the proposed HC zoning district. Montana Avenue is a principal arterial street and the zoning to the north, south, east and west is compatible. The proposed zoning gives reasonable consideration to the district and neighborhood.

10. Does the new zoning give consideration to peculiar suitability of the property for particular uses?
The subject property is suitable for the requested zoning district. The location is on an arterial street that has sufficient capacity for the intended and existing uses. The new zoning allows the existing development to continue.

11. Was the new zoning adopted with a view to conserving the value of buildings?
The existing building value will be conserved with the new zoning in place. Currently, the CC zone does not allow a beverage bottling, warehouse or distribution center. The new zoning will allow the owner to consider future redevelopment of the property.

12. Will the new zoning encourage the most appropriate use of land throughout such county or municipal area?
The proposed zoning will permit the current development to continue and could allow future development for commercial uses. This is the most appropriate use of the lot.