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Regular   5.
Regular City Council Meeting
Meeting Date:
11/09/2015
TITLE
EBURD demolition disposal fees
PRESENTED BY:
Bruce McCandless
Department:
City Hall Administration
Presentation:

PROBLEM/ISSUE STATEMENT

On October 26, 2015, the City Council conducted a public hearing and then tabled a proposal to waive landfill tipping fees for demolition waste from the East Billings Urban Renewal District (EBURD).  The BIRD, Inc. Board requested the waiver and suggested that because demolition and property redevelopment financially benefits the City, that the General Fund should reimburse the Solid Waste Fund for the lost revenue.  Staff recommended that the Council deny the request but offered alternatives such as using EBURD tax increment (TIF) as the tipping fee replacement source, instead of the General Fund.  The BIRD Board has now withdrawn its request in light of staff's assurance that TIF funds may be used for this purpose.  That assurance is based on a thorough review of TIF statutes and Administrative Rules (ARM).

ALTERNATIVES ANALYZED

City Council may:
  • Approve the original request to waive tipping fees and reimburse the Solid Waste Fund from the General Fund, or
  • Disapprove the request by indefinitely tabling the matter.

FINANCIAL IMPACT

The financial impact is unknown because the volume/tonnage of waste cannot not be determined until after the program operates for the proposed two (2) years.  Tipping fees are based on weight; currently $16.67 per ton.  By agreement between the City and Bird, Inc., property owners who redevelop their properties may apply for partial or full reimbursement of eligible improvements.  Bird, Inc. was excluding tipping fees from eligible building demolition costs based on advice from the Department of Revenue (DOR).   BIRD Inc. cannot identify the DOR representative who offered that advice.  City staff reviewed the applicable statutes and ARM and do not support that interpretation.  As a practical matter, the DOR interpretation has been contradicted many times in the downtown TIF and neither DOR nor the City's independent auditors have ever challenged those expenditures.

RECOMMENDATION

Staff recommends that the City Council table the proposal.  If the Council does not include a date when it wants to consider the motion again, tabling the proposal effectively kills it.

APPROVED BY CITY ADMINISTRATOR

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