Thanks to a $10 million federal grant announced Monday, Kalispell’s future is no longer being sidetracked by a hundred-year old railroad line through the center of town.

That money, along with $11 million pledged from local entities, will enable the city of Kalispell and the Flathead County Economic Development Authority to go fast forward on their plans to build out a new rail park between Whitefish Stage Road and East Oregon Lane, remove the railroad tracks from downtown Kalispell, and redevelop a major chunk of downtown Kalispell from Woodland Park on the east all the way to Meridian Road on the west side of town.

This was the city’s third try for a Transportation Investment Generating Economic Recovery grant, and in this case, third time was the charm.

“This is going to transform the community,” Kalispell City Manager Doug Russell said about the changes made possible by the TIGER grant. “The value of this project will be seen for years and years in the future. It’s going to have impacts on the community and the quality of life of Kalispell.”

The plan was developed in 2012 in a partnership between public and private sectors including the city, the county, Montana West Economic Development, Burlington Northern Santa Fe Railway, several businesses, and the Montana congressional delegation. The Glacier Rail Park, located at the former McElroy & Wilken gravel pit location, would be the new terminus of the BNSF rail line. The 40-acre site has been drawn into five parcels of five-to 15-acres for current rail-served businesses such as Northwest Drywall and CHS and/or new ones. Those two businesses are the only two remaining rail-served businesses in town, and are still in negotiations about whether to relocate to the Glacier Rail Park.

Specific objectives in the Rail Park and Core Area plan include:

•  Removing the rails running through Kalispell, paralleling Center Street to the north and winding north of the Kalispell Center Mall. This would allow lots left undeveloped for decades to be connected to street access and city services, encouraging an influx of investment from new businesses.
•  Adding traffic infrastructure for the Glacier Rail Park entry, including a stoplight on U.S. 2 and Flathead Drive.
•  Creating park development and add a bike and walking path where the rails had been located.
•  Widening sidewalks in the core area and extending corners into the street for more walkable crosswalks.
•  Improving streets and building north-south connectors to connect traffic across sections previously blocked by the railroad. Tentatively, three of these connectors would be built on the west side of Main Street and one on the east side.

The final price tag of the Rail Park and Core Area redevelopment project would be just under $22 million, according to Kalispell Community Development Manager Katharine Thompson.

The three major forces driving the Glacier Rail Park project include the city of Kalispell, Montana West Economic Development, and the Flathead County Economic Development Authority.

FCEDA is a “quasi-government group” of seven board members appointed by the Flathead County commissioners. Kellie Danielson, the unpaid CEO of FCEDA, said the group was created to initiate large development projects like the Glacier Rail Park. FCEDA’s operations are mostly funded by two mill levies. But because FCEDA doesn’t have a full staff, the group contracts much of the footwork to Montana West Economic Development, where Danielson is president and CEO.

MWED is a private non-profit business organization with 30 board members. The organization is funded by private-enterprise members in the Flathead, as well as contracting fees paid by FCEDA. The organization works with a budget of about $450,000 a year, according to Danielson.

In 2012, the city put together a nine-person steering committee that included Danielson. The core area plan included 1,100 parcels of land on 365 acres held by 450 property owners. The committee spoke with 149 of the property owners, including community groups and businesses, which hold fully 60 percent of the core area.

“That’s the value of having that community engagement early on,” said Thompson, Kalispell’s development manager. “It’s not supposed to come from the city, it’s for the residents.”

The recurring answer in those discussions was that residents wanted more walkable space through town and a more vibrant downtown area. This included removing the rail from the center of town and redeveloping streets to widen sidewalks.

As a result of those discussions, FCEDA moved ahead with purchasing the McElroy & Wilken gravel pit from the city with money saved over several years from the county mill levies. Kalispell Mayor Mark Johnson and FCEDA board member Jeannie Luckey immediately went into negotiations about relocation with businesses on the rail line to start the ball rolling.

The $10 million TIGER grant is the single biggest piece of funding for the project. It includes $2.6 million for road improvements, $3.1 million for on-site rail construction, $1.2 million for off-site rail construction (where the trains turn around), and $1.7 million for the designs done by KLJ Engineering. The heaviest expense of the project is installing the new rail, said Kim Morisaki, business development and special projects director at MWED. The cost for incoming businesses to lease the land will reflect the cost of building rail lines to the property.

Morisaki said the community has pledged $11 million through community resources to match the TIGER Grant as a sign of good faith from the community. The $11 million is made up of $4.5 million in funding from the city’s tax increment district, along with support from BNSF, Watco Companies and other private investors.

FCEDA, which has raised $6.18 million for the project, has applied to the Montana Department of Housing and Urban Development for a new market tax credit program, which would allay the cost for businesses to relocate to Glacier Rail Park. The tax credit program gives a 39 percent tax break to private investors.

BNSF has also shown support for the project, pledging $500,000 to help fund the new set of rails. Watco, which operates the rail between Columbia Falls and Kalispell, also pledged $200,000 to be paid over five years once the rail is built.

With the federal funding finally secured, FCEDA will draw up bid requests for the initial phases of the project. Kalispell Mayor Mark Johnson said the city will finalize resolutions and formalities in permitting the project. In addition, Thompson will be in contact with the U.S. Department of Transportation to finalize the overall work plan.

“This is a transformative project and it’s going to change Kalispell forever, in the best ways,” Thompson said. “We believe it’s going to be as big as when Kalispell was first put on the map by the rail. It’s going to set the course for us for the next 100 years, so we still have a lot of work ahead.”

For more information on the Rail Park and Core Area plan, visit http://www.kalispell.com/community_economic_development/documents/LowResolutionVersion.pdf.

Reporter Seaborn Larson may be reached at 758-4441 or by email at slarson@dailyinterlake.com.