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Missoula council approves city control of land appraisals during subdivision review

Missoula City Council Chambers
Posted at 8:56 AM, May 11, 2021
and last updated 2021-05-11 10:56:14-04

MISSOULA — The Missoula City Council on Monday voted to take control of the appraisal of undeveloped land as it pertains to the city’s cash in lieu of parkland requirements.

The move, which passed on a narrow 6-5 vote, gives the city the authority to establish a pool of appraisers from which it will tap to set the value of underdevelopment land before development.

“This is a pretty minor change,” said council member Jordan Hess. “It’s been described as surgical and I think that’s a pretty accurate way to describe it. It’s a minor change to create some consistency on how we come up with values to fund parkland.”

Depending on their size, subdivisions are either required to dedicated 11% of their property to parkland or donate a “cash-in-lieu” of parkland payment to the city.

The “cash-in-lieu” payment is set by the fair-market appraisal of the undeveloped parcel. Historically, hiring the appraiser has been the responsibility of the developer, though the city now holds it under its control.

In one of the closest votes under the current City Council, not everyone agreed with the move, which some members of the Consolidated Planning Board described as a “power grab.”

“I understand the need for it – there’s been conflicted information on how to proceed with cash in lieu transactions,” said council member Julie Merritt. “But I’m not able to support this motion at this time. I think we could have approached it better with the development community and got more buy-in from them.”

Others who voted against the measure supported an amendment that would have extended the one-year timeline from the setting of fair-market value to three years. Councilmember Jesse Ramos said any delays on the part of the city during the appraisal process could deter developers and investors from Missoula.

“Sometimes the city is overwhelmed and sometimes it takes far more than a year to get a property approved for development,” Ramos said. “That kind of changes the whole business model. I don’t want this to deter any investors from investing here and developers from development here because we have a supply shortage.

The majority of council members were unmoved by the amendment and voted 7-4 against it.

“The one-year timeline – there are standards by which the length of time an appraisal price is valid,” said Hess. “Those are industry standards. The appraisal is not triggered at a point in time where a delay on the city part could cause any problems on the part of the developer.”

Rising land values are making it hard for the city to secure parkland in certain areas experiencing growth, especially when using funds collected through the cash-in-lieu program. Over time, those cash-in-lieu funds are pooled together, allowing the city to purchase parkland, trails or open space.

At least in theory.

Some members of the planning board, which recommended the City Council deny the changes, believe that Development Services hasn’t been consistent in requiring parkland dedication, or in directing proceeds from the cash-in-lieu system toward anything of substance.