Bozeman Transportation Board Work Sessions on Valet Parking and Capital Improvement Plan – August 26, 2026

The Bozeman Transportation Board met on August 26, 2026, at 6:00 PM for two work sessions: one on proposed valet parking regulations and another on the Fiscal Year 2028–2032 Capital Improvement Plan (CIP). The meeting began with disclosures, public service announcements, and approval of the July 22, 2026, minutes. Staff reported that a City Commission resolution had formally added transportation safety to the city strategic plan.

Public Service Announcements

• Director Nick Ross highlighted the start of construction on the MacWat Road bike/pedestrian project and the award of a construction contract for infill shared-use path sections on Flanders Mill Road, North 19th Avenue, and Valley Center, which came in well under budget.

Approval of Minutes

• The board unanimously approved the minutes from the July 22, 2026, meeting.

Discussion Items: Valet Parking Work Session

• Staff presented a proposal to amend Bozeman Municipal Code to authorize private valet parking services using dedicated curb space in the public right-of-way. Currently, the code lacks such authorization, and two existing valet operations were approved under a previous code that is no longer in effect. Three new valet requests are pending.
• The proposed approach involves three steps: (1) a code amendment to authorize valet permits, (2) a City Commission resolution to establish fees, and (3) administrative creation of a permit program.
• Four policy questions were posed for board feedback:
  • Authorizing Language: Add a new subsection to Chapter 36.04080 for “Exclusive use of on-street parking within public right-of-way by a private entity for valet service through issuance of a permit.”
  • Fee Methodology: Five options were presented: (1) operational cost, (2) replacement cost of parking (estimated $10,000 per surface space, $50,000 per structured space), (3) market value of parking (no strong comparables in Bozeman), (4) past precedent (e.g., $1,027.75 annual permit per stall at the Bridger Parking Garage), and (5) opportunity cost (public benefit vs. loss). Staff noted that cities with paid on-street parking commonly assess fees based on lost parking revenue.
  • Permit Conditions: Staff proposed requiring: location, number of on-street spaces used, time/duration of use, location of off-site vehicle storage (with a private agreement), and annual renewal. Permits would expire with the permit holder and would need reissuance upon business transfer.
  • Treatment of Existing Valet Services: Whether to manage all valet services under the same future code.
• Board members provided extensive feedback:
  • Several members favored an annual fee structure rather than a one-time sale of parking rights, citing Chicago’s experience selling parking rights and later losing control.
  • There was support for a combination fee: operational cost plus a market-based component (e.g., $1.00–$1.50 per hour based on proposed metered parking rates). Members noted that $1.00/hour for a 24/7 spot equals $8,760/year, close to the $10,000 replacement cost for a surface space, but overnight parking restrictions might reduce the effective hours.
  • Board members emphasized that on-street parking is more valuable than garage parking, so the fee should reflect a premium.
  • Some members suggested incentives for partial-day or seasonal use, but others cautioned against overly complicated signs and regulations.
  • Regarding existing valet operations, most board members recommended bringing them under the new fee structure rather than grandfathering them, noting they currently pay nothing. However, legal and fairness concerns were raised about existing agreements.
• No public comments were received during the valet work session.

Discussion Items: Capital Improvement Plan Work Session (FY28–32)

• Director Ross presented the draft CIP, covering fiscal years 2028–2032. The city is required to maintain a five-year plan. Revenue sources include street impact fees, arterial and collector (A&C) district funds, federal STPU (urban route) funds, and street maintenance funds, totaling roughly $10 million annually.
• Key challenges:
  • Funding Gap: The A&C district faces a projected shortfall of about $5.5 million over the five years (estimated $16 million in demand vs. $10.5 million in revenue). Options include project delays, increasing the A&C assessment rate (currently ~$60/year per household), or issuing revenue bonds.
  • Cost Increases: The Kagy Boulevard project (from S. 3rd to Graf) saw significant cost escalation due to retaining walls, tunnels, utilities, and landscaping, requiring more STPU funds than anticipated. This domino effect reduces STPU availability for the College Street (11th to 19th) project and the S. 3rd (Kagy to Graf) reconstruction.
• Proposed additions and revisions:
  • New Impact Fee Project: Laurel Parkway extension (Oak to Baxter) in FY28 as an impact fee contribution to a private development that will build a school district baseball park. The road would be built by the developer with city impact fee reimbursement; if the private project does not proceed, the project will be removed from the CIP.
  • Frontage Road Shared-Use Path: FY29 funding increased to $750,000 by combining a $500,000 annual A&C allocation with a previously approved $200,000.
  • College Street (11th to 19th): Reconstruction to city standards with multimodal improvements, now primarily funded by A&C revenue instead of STPU.
  • S. 3rd (Kagy to Graf): $8.5 million project scheduled for FY31, with $4 million from STPU, $1 million eligible for impact fees, leaving a $3.5 million gap.
• Board members expressed support for the proposed projects and urged against delays, especially for College Street, Frontage Path, and S. 3rd. They favored a combination of phased assessment rate increases and revenue bonding to close the funding gap, noting that modest increases would have minimal household impact. A board member questioned landscaping and irrigation costs; staff explained that current climate requires initial irrigation for tree establishment, but landscapes are designed for long-term water efficiency.
• No public comments were received during the CIP work session.

Key Outcomes

• Valet Parking: The board provided clear guidance to staff to proceed with developing a valet parking ordinance that includes an annual fee combining operational cost and a market-based rate (e.g., $1.00–$1.50 per hour equivalent) and to apply the new fee structure to existing valet services. Staff will return with a formal proposal later in 2026.
• Capital Improvement Plan: The board endorsed the draft CIP projects and recommended using a mix of incremental A&C assessment rate increases and revenue bonds to address the funding gap. Staff will continue refining the plan and return for a public draft in December 2026.
• No formal votes were taken on either topic, as these were work sessions.