The City of Billings operates tax incentive programs under state law authority found in MCA 15-24-1401, 1501, 1502 and 1601.  Billings Ventures, LP, dba Big Horn Resort, located at 1801 Majestic Lane, applied for tax exemption under MCA 15-24-1501 and City Resolution No. 05-18377.  This program encourages existing building remodeling, reconstruction or expansion by exempting 100% of the new improvements' value from city and local school property tax for five (5) years. In the fifth and subsequent years, the improvements are fully taxable.  Minimum requirements are that the construction cost at least $500,000, it adds at least 2.5% to the property's taxable value, property tax payments are current and that the applicant identify the number and type of jobs that the investment will create.

Big Horn Resort submitted an application to abate taxes on a 2012, $1,000,000 building expansion to expand its conference center and outdoor patio.  After making this investment, the company added 14 part time employees.  Zoning is appropriate and taxes are current.  The City Council must conduct a public hearing before considering adopting the attached resolution that grants the tax incentive.

The City Council may approve or disapprove the Big Horn Resort tax incentive application. 

The business pays about $166,000 in state, school, county and city taxes, plus about $30,000 in assessments.  The investment will have a taxable value of about $20,000, so the applicant may save an estimated $3,600/year in City property tax.  Local school taxes are also abated by this action but staff did not attempt to calculate the dollar amount.  Assessments are generally not affected by these tax incentives. 

Staff recommends that the City Council conduct a public hearing and adopt the resolution granting a tax exemption for the Big Horn Resort.