Flathead Beacon | 6/25/2019 | Kim Morisaki
People say we should run government like a business. I don’t always agree with that sentiment because the goal of business should be to make a profit and the goal of government should be to efficiently provide services and other benefits to the community as a whole that a single individual or business could not provide or secure alone. But there is a time when government should “act like a business” and that is when it comes to strategizing for growth, prosperity and the health of the community. A good strategic plan for any business or community identifies strengths, weaknesses, opportunities and threats and identifies tactics that will allow a community to leverage the opportunities and minimize the risks. A good businessperson knows you always try to strengthen your position so if opportunity comes knocking you are prepared to answer the door. They never limit their options for smart growth.
Opportunity is knocking in Flathead County and we need to answer. Currently Montana West meets regularly with developers considering multi-million-dollar building projects in the Kalispell Core Area. At least one of those $10-million-plus projects wants a new library as an “anchor tenant” in a large mixed-use development. Why would business people want a library as part of a development with retail stores and restaurants, office space and apartments or condos? It is simple math. The library has 800 visitors per day. The modern programs paid for by the fundraising of the ImagineIF Library Foundation serve citizens from all walks-of-life. Libraries have kept up with the times and are not just depositories of dusty books, but provide all kinds of digital materials and skill-enhancing programs. All kinds of people visit the library for all kinds of reasons. Young mothers with children, teenagers, senior citizens, entrepreneurs starting businesses, directors of nonprofits, job-seekers using computers to create resumes. And these 800 people a day are the types of “traffic” that any store or coffee shop would want walking by their front door every day. ImagineIF Library is the definition of a perfect “anchor tenant.”
A trail, a splash pad, a library, a community garden, all items that attract both residents and visitors to the heart of a city and create a thriving ecosystem for commerce and an attractive location for developers to build more housing. That all sounds great, but how do you pay for a bigger library or a splash pad? Well, our local Rotary clubs are already fundraising for the splash pad! And Kalispell was designated an Opportunity Zone as part of the current administration’s Tax Cuts and Jobs Act of 2017. This designation combined with the New Market Tax Credit program encourages investors to invest in new development in specific areas and in community facilities in return for lower taxes or a more favorable tax situation. Large investors and developers are motivated to invest in projects to create spaces that benefit the public at large.
Flathead County should leverage these economic development tools and create public/private partnerships. The sudden removal of the Flathead County Library system from the county’s capital improvement plan and the abrupt decision to never own any library facilities even if gifted to the county by the Library Foundation limits options to build on the strengths and opportunities we have. The timing couldn’t be worse. These decisions also ignore the financial benefit of property taxes that will come to the county with every new building built along the new trail. The Montana Department of Revenue recommends that all developers budget 1-2 percent of any new building investment to be paid in property taxes annually. Two percent of a $10 million project is $200,000/year in new revenue that goes to the state, county and city every year. These sudden changes also fail to consider the thousands of new residents coming to the Flathead each year who will pay taxes and expect a certain level of services in return.
CHS and Northwest Drywall will move to the Glacier Rail Park this year. Their relocation allows the city of Kalispell to purchase the land and easements around the tracks in downtown, opening up more than 45 vacant acres. As the building of the trail becomes a reality in a matter of 12-24 months, Montana West is taking meetings with developers interested in building multi-million-dollar retail, commercial, residential and mixed-use projects on or near the trail. Kalispell has seen 6.6 percent population growth since 2016. Flathead County has seen 4.4 percent over the same period. Compare that to 2 percent in Montana and 1.2 percent for the entire U.S. and it isn’t hard to understand why demand for housing, commercial space and even libraries is growing.
We must recognize that we are at the center of a transformative moment created by local efforts and good planning, national trends and federal tax policy. Both a vision and a strategic plan to leverage these forces for sustainable growth are needed more than ever. Now is not the time for any well-run business or government to take any options off of the table.
Kim Morisaki is the business development director at Montana West Economic Development, economic gardener, strategic doer and entrepreneur enthusiast.