Staff recommends the City Council extend the Memorandum of Understandings (MOUs) between the City and each of the 3 Urban Renewal District Advisory Boards (entities) until October 1, 2025.

On May 13, 2019, the City Council approved an MOU with each of the three Urban Renewal District Advisory Boards. Each of those MOUs had an original term of 5 years and expired in 2024. The City Council approved a 1-year extension of the MOUs at its April 22, 2024, meeting. The new expiration date is June 30, 2025. Staff are requesting an extension to the existing MOUs so more time can be given to consider any recommendations for changes required as a result of legislative changes that go into effect October 1.

All three district entities are aware of this extension approach as the City works to ensure compliance with the legislative changes. The intent of this extension is to provide time to navigate the transition of the oversight of the three District advisory boards to a new model per state legislation that was passed in the 2025 Montana Legislative Session.

The three entities are very concerned about the scale of changes that may be necessary and the lack of certainty a four-month extension affords, but the City must ensure it is in compliance with Senate Bill 3 (SB 3) by the October 1 effective date. Each district will need to consider and approve the MOU extension at their regular board meetings. Given the timeframe to get this action to Council before the June 30 deadline, it is possible that the districts may have to act on the MOU extensions after the June 23rd Council action. However, the extension amendments are drafted to take effect at the time of signing. 
 

The City and the three URD entities that are currently parties to the MOUs are stakeholders in this process of extending the MOUs. The intent of this extension is to provide time to navigate the transition of the oversight of the three District advisory boards as required by SB 3 which was passed in the 2025 Montana Legislative Session. 

City Council may:

• Approve the MOU extensions until October 1, 2025; or,
• Modify the MOU termination dates and extend them to a new date certain; or
• Not Approve the MOU extensions. If not approved, the MOUs for each district will expire on June 30, 2025.

Extending the MOUs would mean the FY26 Urban Renewal District (URD) budgets, as preliminarily adopted by the Council at its June 23, 2025, meeting, would continue to be implemented until the MOUs terminate in October, new MOUs are approved, the Council makes budget amendments, or some other financial arrangement is approved by Council.