The Downtown Billings Partnership Board has reviewed this TIF application and recommends the City Council approve up to a maximum reimbursement of $79,940 from Downtown Urban Renewal tax increment finance district funds to Kibler & Kirch. Actual reimbursement will be based on 100% of the actual costs incurred for renovation of space in the Stapleton Building at 2807 1st Avenue North, subject to the following conditions:

1. The Applicant shall sign a development contract with the City of Billings and DBP within 90 days of City Council’s approval.
2. This TIFD reimbursement is the maximum that can be received pending satisfactory submission of all paid invoices showing the completion of expenditures related to this project.
3. If funds are not available, reimbursement can be carried over to the next fiscal year.

The DBP staff received and reviewed this TIF Application in October. It was then reviewed and recommended by the DBP Development Committee on November 12 and the full DBP Board on November 20, 2020 (See DBP Meeting Minutes attached).

The Development Committee and Board verified/clarified several issues during review, including:

• That the Stapleton Building has undergone significant rehabilitation and renovation already and the space that Kibler & Kirch is occupying is the remaining vacant space in the building for a commercial use that will complete recent improvements and full occupation of the south side of the building.
• The Development Committee and the Board's recommendation was less than the applicant's original request of $143,927 because both bodies found that while there were strong reasons to support the application and there were qualifying expenses, the public benefits of the project were less visible given the great condition of the Stapleton Building and the limited public facing improvements of the store frontage and entry area along the south side of the Building. The recommended award is almost an 11:1 private to public investment ratio given the total project cost of $861,838. The Development Committee and the Board supported the project and found:

The application aligns with elements/goals of the DBA Strategic Plan (may be viewed through this link https://downtownbillings.com/about/about-the-dba/), City TIF Policy, MCA, and the North 27th Street District Urban Renewal Plan (See table below and attachments) For example, the adopted Urban Renewal Plan for the North 27th Street District, contemplated TIF funding assistance for business retention in its Business Programs and Projects section.
 

Qualified Improvements	DBA Strategic Plan	Urban Renewal Plan	City TIF Resolution	Montana Code Annotated
Exterior demo, lighting, signage, awning, glass, storefront, metal & ironwork Interior demo, energy efficiency, electrical, plumbing, code, utilities, accessibility	Strong Downtown Identity – P.13 Vibrant & Connected Downtown – P.13   Diverse Economic Engine - P.13	Business Programs & Projects – P.54 Infrastructure Improvements (Entertainment Venues) – P.55	Permitted uses of TIF Funds: Private infrastructure with Public Benefit (Facades, Windows, – P.2 Financial Assistance Through TIF – P.2	7-15-4233 7-15-4288

Kibler & Kirch is a design and retail store of more than 30 years and its retail store was in Red Lodge until September 2019 when the business decided to relocate to Billings. The Design portion of the business has been in the Stapleton building for six years and the business decided to relocate the entire operation to the single location in the Historic Stapleton Building. While there has been major private investment in rehabilitating the Stapleton Building over the course of many years, there’s an underutilized abandoned space on the south side of the building that is planned to capture a new vision of the retail store of nearly 6,000 square feet. Kibler & Kirch will occupy a long-vacant, 2nd floor space as well as ground floor storefront between Rockets Gourmet Wraps and Le Fournil French Bakery. Inside that small footprint, it will recreate the building’s original stairway, install an elevator shrouded by decorative ironwork, and connect the ground floor and 2nd floor via a large opening. By creating access to this 2nd floor space, the intent is to create an architecturally interesting space for pedestrians and traffic on 1st Avenue North. The new store/front entrance will have new lighting, signage, awnings, and other storefront elements.

Kibler & Kirch is requesting TIF funds to reimburse it for improvements and modifications, including some design and demolition, new exterior lighting, new exterior awnings, facade and window work. The total reimbursement recommended is $79,940. If the total cost of the project invested ($861,838) is factored into the request, the private investment is 90% and the public investment is 9%, or about a 10 to 1 ratio. The DBP Development Committee and the DBP Board both supported this application request, recognizing Kibler & Kirch is making a significant commitment and investment in Downtown Billings that will complete revitalization of the Stapleton Building street level retail occupancy while continuing to make the building a viable and valuable contributor to the downtown area.

City Council may:

• Approve the recommendation from the DBP Board for the expenditure of these TIF funds consistent with some elements/goals of the DBA Strategic Plan, North 27th Street Urban Renewal Plan, City TIF Policy and MCA, or;
• Modify the recommendation from the DBP Board for the expenditure of these TIF funds before taking action, or;
• Disapprove the recommendation from the DBP Board for the expenditure of these TIF funds. If the Council chooses not to approve this TIF application, specific reasoning for the denial is helpful to provide further direction to the DBP Board and staff, and City staff for future applications.

The request is for up to a maximum of $79,940 to be reimbursed to Kibler & Kirch for the identified building remodeling and exterior improvements (See TIF Application Attachment). The estimated total project cost is $861,838, making the private to public investment ratio for this project about 10:1. The funds are payable pending satisfactory submission of all paid invoices showing actual cost incurred for the project. The current FY21 project budget for the Downtown District is $310,501, so a budget amendment would not be needed to cover this project if it were all reimbursed in FY21. The Downtown District has $1,343,295 in total available TIF funds in the FY21 Budget, so this project can be covered and $1,263,355 would be remaining for other projects or programs. If all three Downtown District projects being reviewed by the Council at this meeting were approved and expended in FY21, the Downtown District would have $131,217 remaining in its FY21 Budget.