Mayor & City Council

WHITEFISH CITY COUNCIL October 4, 2021 7:10 P.M. 1) CALL TO ORDER Mayor Muhlfeld called the meeting to order. Councilors present were Qunell, Feury, Hennen, Davis, Sweeney, and Norton. City Staff present were, City Clerk Howke, City Manager Smith, City Attorney Jacobs, Planning and Building Director Taylor, Public Works Director Workman, Parks and Recreation Director Butts (via Webex), Interim Police Chief Kelch, Fire Chief Page, Senior Planner Compton-Ring and Planner II Osendorf. Approximately 28 people were in the audience and 3 attended via Webex. 2) PLEDGE OF ALLEGIANCE Mayor Muhlfeld asked Lauren Oscilowski to lead the audience in the Pledge of Allegiance. 3) COMMUNICATIONS FROM THE PUBLIC– (This time is set aside for the public to comment on items that are either on the agenda, but not a public hearing or on items not on the agenda. City officials do not respond during these comments but may respond or follow-up later on the agenda or at another time. The mayor has the option of limiting such communications to three minutes depending on the number of citizens who want to comment and the length of the meeting agenda) Toby Scott, 1478 Barkley Lane, reminded Council and the audience that the Montana Department of Transportation has a Whitefish Downtown Highway Study. They had an Open House two weeks ago. They have a plan to renovate the entrance to Whitefish. He asks the Council and the public that is listening to review this plan online and express your thoughts on the options. MDOT will go on with their preferred plan unless there is enough feedback to the contrary. The plan can be viewed on their website https://mdt.mt.gov/pubinvolve/downtownwhitefish/, and there is a feedback window on the website. Erik Wenum, Fish Wildlife and Parks, Bear Specialist, reviewed some of the numbers for the Council and the citizens. The month of September only, he received 315 call about bears and bear conflicts. 135 of those calls originated in Whitefish alone. 35% of those calls were about fruit, 65% was about trash. Whitefish represents about 10% of Flathead County population and generates 43% of the bear conflicts. Fruit trees are a seasonal aspect, but trash is a year-round issue and continues to grow larger every year with every month. Currently there are four bears up a tree on Iowa Avenue, and about 15-18 bears within the city limits. 4) COMMUNICATIONS FROM VOLUNTEER BOARDS a) Resolution No. 21-39; A Resolution extending the term of the Whitefish Sustainable Tourism Management Plan Steering Committee and amending its membership (p.33) Councilor Feury made a motion, seconded by Councilor Qunell to approved Resolution No. 21- 39; A Resolution extending the term of the Whitefish Sustainable Tourism Management Plan Steering Committee and amending its membership. The motion carried. 5) CONSENT AGENDA (The consent agenda is a means of expediting routine matters that require the Council’s action. Debate does not typically occur on consent agenda items. Any member of the Council may remove any item for debate. Such items will typically be debated and acted upon prior to proceeding to the rest of the agenda. Ordinances require 4 votes for passage – Section 1-6-2 (E)(3) WCC) a) Minutes from September 20, 2021, Regular Session (p.37) Councilor Sweeney made a motion, seconded by Councilor Hennen to approve the Consent Agenda as presented. The motion carried. 6) PUBLIC HEARINGS (Items will be considered for action after public hearings) (Resolution No. 07-33 establishes a 30-minute time limit for applicant’s land use presentations. Ordinances require 4 votes for passage – Section 1-6-2 (E)(3) WCC))  CITY COUNCIL MINUTES October 4, 2021 a) Resolution No. 21-40; A Resolution of Intention, indicating its intent to adopt the Whitefish Highway 93 South Corridor Plan as an amendment to the 2007 Whitefish City-County Master Plan (2007 Growth Policy) (WPGA 21-02) CONTINUED FROM 9/20/2021 (p.45) Building and Planning Director Dave Taylor presented his updated staff report that is provided in the packet on the website. Mayor Muhlfeld opened the Public Hearing. Mayor Muhlfeld mentioned Council received substantial number of comments written via email. Some of the comments were very extensive so asked comments be held to three minutes. Toby Scott, 1478 Barkley Lane, urges the Council to amend the Highway 93 S. Corridor Plan, segment B future land use map to designate the 7 acre parcel off of Pheasant Run to high density residential or general commercial to help facilitate workforce housing. If it can’t be done in this plan, he would like the Council and multiple steering committees address the thought of changing the Growth Policy to allow for this. Somewhere we have systematically eliminated high-density housing throughout the Whitefish area and the surrounding area if it is annexed. We have to provide an avenue for high-density housing. Ed Doctor, 845 Wisconsin Avenue, supports the Hwy 93 South Corridor Plan, and hopefully find a place to house a lot of people. Mayre Flowers, Citizens for a Better Flathead, provided written comment that is appended to the packet and reviewed the letter. This plan should be addressing transportation issues not commercial development. She does not think framing a corridor plan to lock land use decisions is the way to go. Charles Gale, 124 Park Knoll Lane, agrees we need workforce housing, but this is not the right location, for several reasons: the impact of future development, utilities, and infrastructure. He supports the Corridor Plan but is opposed to the amendment. Dave Hunt, 113 Park Knoll Lane, asked and Director Taylor stated the memo outlines the pros and cons of public comment that was provided. Staff recommends the corridor plan as it is written. Staff does not have an issue with that particular parcel if council wants to change that particular 7 acres. Staff is not in favor of having a blanket policy for high-density residential everywhere that new properties annex to the city. Park Knoll neighborhood recommends council not make any amendments to the proposed corridor plan. Karen Giesy, 121 Park Knoll Lane, requests the council not amend the proposed corridor plan. Michelle Weinberg, 116 Lupfer Avenue, spoke on behalf of the South Whitefish Neighborhood Association and provided written comment that is appended to the packet. The Association’s public comments dated September 20th and October 1st, 2021, explain why the corridor plan is not consistent with the Growth Policy, with respect to the land use designation changes proposed in segments B and C. These inconsistencies are obvious by comparing the Growth Policy’s future land use map with the corridor plan’s proposed changes. There is evidence to support that the proposed changes to the land use designation in segment B and C, and its implication for commercial and higher density residual residential development conflicts with the Growth Policy, including but not limited to the Growth Policy’s water quality goals, critical area goals, goals related to the preservation of open and rural lands and the Growth Policy’s economic development goals. The association asks the Council not to move forward with adopting the corridor plan land use designation without additional study of this environmentally sensitive area. There being no further public comment, Mayor Muhlfeld closed the Public Hearing and turned the matters over to the Council for their consideration. 2  CITY COUNCIL MINUTES October 4, 2021 Councilor Qunell made a motion, seconded by Councilor Hennen to adopt Resolution No. 21-40; A Resolution of Intention, indicating its intent to adopt the Whitefish Highway 93 South Corridor Plan as an amendment to the 2007 Whitefish City-County Master Plan (2007 Growth Policy), including adding “Section 4; The City Council of the City of Whitefish, Montana, will consider adoption of the Whitefish Highway 93 South Corridor Plan as an amendment to the 2007 Growth Policy at its regularly scheduled meeting to be held December 6, 2021, at 7:10 p.m.”. Councilor Qunell stated we need to respect the amount of time and consideration that has already been put into this plan and move it forward to the next stage. Councilor Norton asked and staff reported adoption for the updated transportation plan will be early 2022; the Housing Needs Assessment will be pushed to May or June of 2022; and state law allows City Council to amend a Growth Policy. Councilor Qunell would like to get more information on how corridor plans are used in Kalispell and other parts of the state; and whether this land use map that Mayre Flowers provided is all of city limits of Kalispell or extends into their county area. He would like a definitive answer to being locked in if this becomes a Growth Policy amendment versus having a separate corridor plan. Director Taylor stated all corridor plans are updates of the Growth Policy. Councilor Qunell states Kalispell is a bigger city, and if they have a more flexible plan than we do, we could learn something from that. Councilor Davis stated the comments pertaining to the annexation policy is fair but thinks it is unrelated to what we are doing here. There are a lot of good ideas in this corridor plan that should be adopted, and we should move ahead now. The motion to approve Resolution No. 21-40 carried. b) Consideration of a request from Hold Your Horses LLC, for a Conditional Use Permit to amend condition #6 regarding the minimum number of parking spaces required with previously approved Conditional Use Permit WCUP 16-08 (Whitefish Board House), located at 625 Park Avenue, zoned WR-4 (High Density Multi-Family Residential District) (WCUP 21-20) (p.208) Senior Planner Compton-Ring presented her staff report that is provided in the packet on the website. Mayor Muhlfeld opened the Public Hearing. There being no public comment, Mayor Muhlfeld closed the Public Hearing and turned matters over to the Council for their consideration. Councilor Qunell made a motion, seconded by Councilor Hennen to approve WCUP 21-20, the Findings of Fact in the staff report and amended condition #6. The motion carried. c) Consideration of a request from Courtney Ulvin and Dillon Matteson, for a Conditional Use Permit for an accessory apartment, located at 1018 Patton Lane, zoned WR-2 (Two- Family Residential District) (WCUP 21-21) (p.239) Planner II Tara Osendorf presented her staff report that is provided in the packet on the website. Mayor Muhlfeld opened the Public Hearing. There being no public comment, Mayor Muhlfeld closed the Public Hearing and turned the matters over to the Council for their consideration. Councilor Hennen made a motion, seconded by Councilor Qunell to approve WCUP 21-21, the findings of fact in the staff report and the eight conditions of approval. The motion carried. d) Consideration of a request from Rimrock Companies, for a Conditional Use Permit to develop a hotel at 21 Hedman Lane, zoned WB-2 (Secondary Business District) (WCUP 21- 19) (p.271) 3  CITY COUNCIL MINUTES October 4, 2021 Senior Planner Wendy Compton-Ring presented her staff report that is provided in the packet on the website. Mayor Muhlfeld opened the Public Hearing. Doug Peppmeier, TDH Engineering, representing the applicant, stated they agree with the staff report and the conditions of approval. The traffic engineer has submitted data to MDT. MDT was satisfied and did not request any additional information based on that data. Randy Olsen, 115 Ardell Dr, Kalispell, Whitefish First Baptist Church Pastor, commented the access to the church property from the proposed development is not a frontage road. It is an access road to the property. He would like that to be corrected. Rhonda Fitzgerald, 412 Lupfer Avenue, stated she is somewhat puzzled by the proposal. It is unspecified of what type of hotel it is. Council is being asked to permit a use rather than a project. That concerns her because it is hard to understand what will actually happen. There being no further public comment, Mayor Muhlfeld closed the Public Hearing and turned the matters over to the Council for their consideration. Councilor Norton made a motion, seconded by Councilor Qunell to deny WCUP 21-19. Councilor Norton has a lot of concerns about the traffic impact, and the large body of water above this area. She doesn’t think at this point we need more hotel rooms. Councilor Qunell will not support this project. Condition number 6 will have a negative impact that we can’t foresee. He understands we follow MDT guidelines and the traffic study guidelines, but without a connection to JP Road we can’t have 500 vehicle trips per day to go north on Highway 93. It is not the right time for this without the infrastructure in place. Discussion followed pertaining to the criteria that is required for approval. Councilor Norton withdrew her motion, seconded by Councilor Qunell. Councilor Norton made a motion, seconded by Councilor Qunell to postpone WCUP 21-19 to October 18, 2021. The motion carried. Mayor Muhlfeld called for a recess at 8:40 pm and reconvened the meeting at 8:50 pm. e) Ordinance No. 21__; An Interim Zoning Ordinance enacting a 90-day moratorium on the processing and issuance of new short-term rental licenses within City limits (Only Reading) (p.337) City Attorney Jacobs presented the proposed Interim Zoning Ordinance that is provided in the packet on the website. Mayor Muhlfeld opened the Public Hearing. Giuseppe Caltabiano, 2075 Lion Mountain Loop Road, provided a letter that is appended to the packet. He opposes the Interim Zoning Ordinance pursuant to Montana Annotated Code section 7-5-4204 measure which are “immediately necessary” for preservation of “peace, health, and safety”. He asks the Council to seek and publish a formal opinion from either the City Attorney or Attorney General. This looks to be in excess of the City’s charter self-government powers. Jeff Raper, 719 Kalispell Avenue, stated short-term rentals is not our affordable housing issue. Over the last three years which include residential, single-family residents, condos, and townhouses; less than 10% is utilized for short-term rental; 90% of our growth and price appreciation is on standard residential projects; condos and townhouses with 30 days or more for use. A lot of the areas are already restricted 4  CITY COUNCIL MINUTES October 4, 2021 for the use of short-term rental. Before putting on a moratorium, take a deeper look at the overall aspect that this is going on across the U.S. Property valuations have spiked within the last 24 months, not because of short-term rental but because of a pandemic. People are coming from metropolitan areas flush with cash. A property on the market for $800,000 is selling for $1.25 million. It is not zoned for short- term rental. They have to reside in that house. It really is not a short-term rental issue. Nathan Dugan, 937 Kalispell Avenue, supports the moratorium to make an assessment and protect the limited housing supply that we do have for long-term rentals. License fees and fines need to be increased for people who are renting out short-term rentals illegally. The city needs time to hire another staff member or hire a consultant or software solutions. The moratorium provides the time the city needs to protect those with legal short-term rentals. Rhonda Fitzgerald, 412 Lupfer Avenue, via Webex, agreed, the moratorium gives the city time to fully understand the impact of the short-term rentals is the point. There is a lot to learn. This is something that is happening very fast and impacting our community extensively, especially housing. It is very important the city wrap their arms around this and really understand the phenomenon and the best way to do that is with a moratorium. It gives everyone time to better understand what is happening to our community. Lauren Oscilowski, Sustainable Tourism Management Plan Committee Chair, views this discussion as addressing two challenges our community faces: over visitation and workforce housing. The proposed moratorium is addressing both of those. Our community has been trending this direction for the better part of a decade and has seen a swift uptick in the past two years. COVID sped up the problem that we were already starting to face. We must fight to maintain a sustainable livable community for our citizens. The city needs short-term rental regulation and enforcement and until then there will continue to be short-term rentals operating illegally, either un-licensed or in undesignated zones. The Committee discussed if there is a way, we can re-write the language and redefine the usage of a short-term rental or change the use of zoning terminology with regard to a short-term rental. Currently there is no regulation in areas that are zoned to allow short-term rentals. Can it be regulated to Montana residence only; or can only be operated for 50-days? Place incentivizes for property owners to rent long-term to our citizens instead of short-term to visitors. The Committee is in support of a moratorium on short-term rentals so we can further explore what that looks like. There being no further public comment, Mayor Muhlfeld closed the Public Hearing and turned matters over to the Council for their consideration. Councilor Qunell made a motion, seconded by Councilor Hennen to adopt Ordinance No. 21__; An Interim Zoning Ordinance enacting a 90-day moratorium on the processing and issuance of new short-term rental licenses within City limits. Councilor Qunell stated he doesn’t necessarily think the short-term rental issue is a big contributor to our overall housing problem. It is a contributor to our sustainability. Discussion followed between the Council pertaining to; what is over visitation, what does it mean; enforcement of illegal, unlawful short-term rentals; and impacts to infrastructure. Manager Smith stated if this Ordinance is adopted, the 90-days will run past January 1 st, which is when the renewals actually occur for all currently licensed short-term rentals. Will those that are licensed as of today be allowed to renew as of January 1st? The motion to adopt failed 4-3, Councilors Norton, Qunell and Hennen voting in the affirmative, Councilors Feury, Sweeney, Davis, and Mayor Muhlfeld voting in the opposition. 7) COMMUNICATIONS FROM FINANCE DIRECTOR a) Review and consideration of the annual 2020 Impact Fee Report (p.340) 5  CITY COUNCIL MINUTES October 4, 2021 Finance Director Ben Dahlman presented the annual Impact Fee Report that is provided in the packet on the website. Councilor Qunell made a motions, seconded by Councilor Hennen to approve the annual Impact Fee Report for FY20. The motion carried. 8) COMMUNICATIONS FROM CITY MANAGER a) Written report enclosed with the packet. Questions from Mayor and Council? (p.346) None b) Other items arising between September 29th through October 4 th Manager Smith reported the Forrest Service will be doing prescribed burns in the Whitefish Municipal Watershed and the Taylor Hellroaring starting Tuesday, October 5, 2021. The burns will be noticeable from Whitefish and the surrounding area. Cawdrey Gallery approached Manager Smith regarding a bronze statue that currently is on display at their previous gallery location on Wisconsin Avenue. They do not have space available at their new location and would like to place it on the O’Shaughnessy property at the corner of Railway and Central Avenue. Manager Smith is working on a city statement on each individual allegation of the Impact Fees made from Paul Gillman and Bill Burg. The state contacted the City’s auditors at this point the direction she received from Council was to not hire a specific auditor, but it could be looked into during our regular audit as part of a risk assessment. c) Resolution No. 21-41; A Resolution approving an Interlocal Agreement between Flathead County, the City of Kalispell, the City of Whitefish, and the City of Columbia Falls to maintain and operate the Flathead City-County Health Department as one organization with County-wide jurisdiction in matters of public health (p.352) Manager Smith presented her staff report that is provided in the packet on the website. Councilor Hennen made a motion, seconded by Councilor Qunell to approve Resolution No. 21- 41; A Resolution approving an Interlocal Agreement between Flathead County, the City of Kalispell, the City of Whitefish, and the City of Columbia Falls to maintain and operate the Flathead City-County Health Department as one organization with County-wide jurisdiction in matters of public health. The motion carried. 9) COMMUNICATIONS FROM MAYOR AND CITY COUNCILORS Mayor Muhfeld stated his reasons behind breaking the tie for the Moratorium. He doesn’t feel we have adequately substantiated the need at this time for a moratorium. He appreciates the public comment that was received. He relies heavily on the advice of our city attorney. He is concerned of the potential backlash we could receive from the state legislature. He is comfortable with the text amendments that Council has directed staff to bring forward. . He appreciates everything that was done tonight, Council did a lot of good work over the last couple months addressing this issue and will move forward in a positive manner. Councilor Norton stated the Whitefish Pilot will be holding a Virtual Council Candidate Forum on October 14th at 7:00 pm. The link to the Forum will be provided on WhitefishPilot.com. She asked and City Clerk Howke reported a ballot box will be delivered to the City Hall on October 13 th as a drop off location for the City Election. Ballots can also be dropped off after hours in the Utility Payment box 6