The South Billings Urban Renewal Association (SBURA) Board has reviewed this application for tax increment assistance and recommends the City Council approve, upon project completion, a maximum of $100,000 of Tax Increment Finance (TIF) funds from the South Billings Boulevard Urban Renewal District (SBBURD) to Billings School District #2 (SD2). Actual reimbursement will be based upon 100% of the actual costs incurred for qualified expenses for the improvements made to property at 3700 Madison Avenue south of the existing Riverside Middle School subject to the following conditions:

1. The Applicant shall sign a development agreement with the City of Billings and SBURA within 180 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 SBURA board considered SD2’s application for tax increment assistance at its May 3, 2022, board meeting and voted unanimously to recommend the application to the City Council. SD2 plans to make approximately $1.3 million of schoolyard improvements to property it acquired south of Riverside Middle School (See aerial view and site plan attached to this memo). These improvements are intended to place Riverside Middle School on par with other SD2 middle schools.  The improvements will help eliminate blight by developing a previously vacant property that was used by transients and was an attractive nuisance in the neighborhood.  The infrastructure/amenities include:

· A new parking lot area to expand the existing school's main parking area
· A girls softball field
· Track & field facilities
· Two stormwater retention ponds
· A walking path for school and community use

SD2's application for TIF assistance identifies a total project cost, including the land acquisition, of $1.3 million. The land purchase was $275,000 and the remaining improvement costs include fencing, tree removal and trimming, and the major facility improvements listed above. The District requested consideration for $217,149 in TIF funds. The SBURA Board reviewed the application and is recommending $100,000 in funds be awarded. The recommended reimbursement is about 10% of the total project cost after the property acquisition is removed from the project. The SBURA Board found the project aligns with its SBBURD Urban Renewal Plan in supporting school and community services. Specifically in Section 13 of the Plan, it states: "School and Community Services – Assist in funding projects and programs in the District to enhance school playgrounds and athletic fields, health and wellness programs, access to community meeting and activity spaces, and other efforts that improve access to school and community services."

Table 1 below outlines the alignment of this request with specific sections of the City's TIF Policy, SBBURD Urban Renewal Plan and Montana Code.

Table 1

Qualified Improvements	Recommended TIF Reimbursement	City TIF Policy	Urban Renewal Plan	MT Code Annotated
School grounds infrastructure	$100,000	Section 1(b)	Section 11 Section 12 Section 13 Section 14	7-15-4288(4)

City Council may:

· Approve the recommendation from the SBURA board for the expenditure of these tax increment finance (TIF) funds that are consistent with elements of the South Billings Boulevard Urban Renewal Plan, or;
· Modify the recommendation from the SBURA board for the expenditure of these TIF before taking action, or;
· Disapprove the recommendations from the SBURA board for these expenditures of these TIF funds.  If the Council chooses not to approve the TIF application, specific reasoning for the denial is helpful to provide further direction to the SBURA board and City Staff for future applications.

The recommendation is for a maximum of $100,000 to be reimbursed to SD2 for the identified work (See SBURA recommendation attached to this memo).  The estimated total project cost is approximately $1,302,636.  The funds are payable per the conditions of approval outlined in the SBURA recommendation and pending satisfactory submission of all paid invoices showing actual cost incurred for the project.  Currently, the project is estimated for completion in late 2022.  These payments are already incorporated into the FY23 budget.