The Council is being asked to consider adopting a resolution to modify the East Billings Urban Renewal District (EBURD) originally created on November 16, 2006.  The attached resolution declares the Council’s intention to modify the district, including tax increment authority, describes the property involved and the blighted conditions, sets a public hearing for April 13, 2015, and directs staff to make the necessary public notifications.

Progress since 2006 has occurred within the EBURD, as evidenced by:

1. Increase in taxable value: base year value of $1,800,794, increased to a 2014 value of $2,502,968 (Montana Department of Revenue Form AB-72T, 8-4-2014)
2. Successful approval of both the EBURD Master Plan and the Exposition Gateway Plan
3. Successful implementation of the recommended Parking Overlay District
4. Two-way streets conversions on 2nd Avenue North and 3rd Avenue North
5. EPA Brownfields Program environmental assessments completed on 23 parcels
6. Successful adoption of the EBURD Zoning Code
7. Completed the Hospitality Corridor Study
8. Approval of a project to address flooding, storm water management, and infrastructure improvements in the eastern-most portion of the District.

However, many of the undesirable conditions continue to exist, and several properties adjacent to the District have been annexed into the City. Therefore, it would be in the best interest of the City to expand the District to encompass these adjacent properties, construct needed public infrastructure improvements, grow the tax base, increase the parking inventory, increase the inventory of residential property, stimulate mixed-use development, and further implement the visions of the EBURD Master Plan, Exposition Gateway Concept Plan, and the Hospitality Corridor Study, all of which are consistent with the adopted 2008 Yellowstone County and City of Billings Growth Policy. For more detail on the conformance with this EBURD modification with the 2008 Growth Policy, please see Section 10 of the EBURD Plan Amendment attached to this memo.

City Council may:

• Approve the resolution of intent to modify the EBURD.
• Not approve the resolution of intent to modify the EBURD.
• Modify the proposed boundary of the EBURD and adopt the resolution of intent.

The exact financial impact of modifying the EBURD is unknown.  However, the 2014 taxable market value of the 14 properties to be included in the modified EBURD is approximately $93,600.  The purpose of an urban renewal and tax increment district is for the public to invest in infrastructure and thereby encourage private investment that increases the taxable value.  Without the public investment, it is assumed that the private investment would not occur on these properties, thus there is no “loss” of taxes from freezing the taxable value base because all taxing entities continue to collect taxes on the base value as it is today.

The EBURD was created on November 16, 2006. The existing urban renewal plan may be modified by ordinance in accordance with the procedure described in M.C.A. § 7-15-4221. In January 2015, 12 properties encompassing about 18 acres were annexed into the City. In addition, a property owner with property at 620 North 14th and 622 North 14th adjacent to the existing EBURD and already in the City requested that these two properties also be included in the EBURD. The properties are adjacent to the existing District.

Determination of Blight
The proposed EBURD Expansion area contains a number of underdeveloped properties and substandard facilities.  The Council previously determined that the property included in the EBURD was “blighted” within the meaning of the Act in its adoption of Ordinance #06-5395 that (a) created the East Billings Urban Renewal District (EBURD) and (b) adopted an urban renewal plan for the district (November 16, 2006).  Deficiencies in public and private properties located in the district led to a determination of blight, as defined by state statute.  As cited in the original Urban Renewal Plan, the area still meets several definitions of blight. Further details of the determinations summarized below are found in Section 5 of the EBURD Plan Amendment attached to this memo: Deficient Structures - buildings, street infrastructure, water and sewer infrastructure, stormwater infrastructure; Deficient Land Use - surface storage lots, vacant lots, single-story structures; Protecting Public Health and Safety- conditions of blight, crime, vagrancy and potential brownfields, as described above, reduce “social capital” and community connectedness. Flooding promotes mold growth and related health problems. The City desires to improve the quality of land use and economic development potential of these properties by including them in the EBURD.

PROCEDURAL HISTORY

• Over the course of a year or more, the Billings Industrial Revitalization District (BIRD) Board and staff, acting as advisory to the City Council in the EBURD, met with all of the owners of County property in the area east of the EBURD, south of 6th Avenue North, North of 1st Avenue South, and west of Exposition Drive. These discussions included and followed the process that led to the adoption by the City Council and Board of County Commissioners of the Exposition Gateway Concept Plan for the subject area. The meetings also led to some of the property owners petitioning for annexation into the City.
•  In addition, a property owner with property at 620 North 14th and 622 North 14th adjacent to the existing EBURD (620 North 14 is directly adjacent to the EBURD boundary and 622 North 14 is adjacent to 620 North 14th) and already in the City met with BIRD staff and requested that these two properties also be included in the EBURD.
• On January 26, 2015, the City annexed 12 properties in the Exposition Gateway Concept Plan area.
• On March 24, 2015, the Yellowstone County Board of Planning will act on a recommendation to the City Council as to the modified EBURD Plan's consistency with the Growth Policy.
• If the City Council approves the Resolution of Intent to Modify the District, Declare Blight, and set a public hearing date, the Council will conduct a public hearing on April 13, 2015 and conduct a first reading on an ordinance to expand the EBURD.
• If the City Council approves the ordinance modifying the EBURD on first reading on April 13, the Council will conduct a second reading of the ordinance on April 27. The ordinance will take effect 30 days after second reading.

The owners of the properties to be included in the modified EBURD area were contacted by the BIRD Board and staff about modifications to the District.  The owners will be officially notified via letter in accordance with 7-15-4215, MCA, of the public hearing on the modified EBURD to be held April 13, 2015. Notification of the public hearing by the City Council on April 13, 2015, will be properly advertised in the Billings Times.

Conformance with the Yellowstone County and City of Billings 2008 Growth Policy is one requirement for adopting or modifying an urban renewal plan. Growth Policy conformance is outlined in Section 10 of the EBURD Plan Amendment document attached to this memo. Further, the Yellowstone County Board of Planning will provide a recommendation to the City Council on the proposed EBURD Plan Amendment's conformance with the 2008 Growth Policy prior to the public hearing and first reading of the Ordinance on April 13, 2015.