The South Billings Urban Renewal Association (SBURA) Board has reviewed this application for tax increment assistance and recommends to the City Council, upon project completion, a maximum of $463,085 of Tax Increment Finance funds from the South Billings Boulevard Urban Renewal District (SBBURD) to Billings Hotel and Convention Center (BHCC). Actual reimbursement will be based upon 100% of the actual costs incurred for qualified expenses for the improvements made, 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 amount that can be received pending satisfactory submission of all paid invoices showing the completion of expenditures related to this project.
3.) The project reimbursement will occur after construction is completed.
4.) If funds are not available, reimbursement will be carried over to the next fiscal year.

The SBURA Board considered BHCC II, inc. application at its May 20, 2024 board meeting and voted unanimously to recommend $463,085 of tax increment assistance. BHCC II, inc. owns and operates the Billings Hotel and Convention Center at 1223 Mullowney Lane.

The proposed project will construct an addition to the existing building that will add 16,000 sq. ft of new conventions pace. This will allow for events that can host between 1,200 and 2,000 people. This new space, along with the existing onsite conference space, will attract larger groups that may otherwise overlook Billings. Additionally, it is proposed that the addition will allow the hotel to employ an additional 15 FTE.

Total construction costs are estimated to be $4.9 million. The total requested amount of $463,085 is approximately a 1:11 ratio of investment of public vs private funds. This is a greater investment of private funds than the City TIF policy suggests, which is a minimum of 1:5.

Table 1 below details the proposed expenses recommended for tax increment assistance to BHCC II, Inc. There is also detail information relating to the project costs included in the BHCC TIF Application, attached to this memo.

TABLE 1. 

Qualified Improvements	Estimated Costs	City TIF Policy	Urban Renewal Plan	MT Code Annotated
Site Demo and Site Work	$203,700	Section 1(a)	Section 13	7-15-4233(i)
Storm Water, Utilities, and Fire Lane	$166,487	Section 1(b)	Section 13	7-15-4288(4)
Asphalt	$54,513	Section 1(b)	Section 13	7-15-4233(i)
Landscaping	$38,385	Section 1(c)	Section 13	7-15-4233(i)

City Council may:

• Approve the recommendation from the SBURA board for the expenditure of these tax increment finance (TIF) funds; or,
• Modify the recommendation from the SBURA board for the expenditure of these TIF funds; or,
• Disapprove the recommendations from the SBURA board for the expenditure of these TIF funds. If the City Council chooses not to approve the TIF application, specific reasoning for the denial will be important for City staff and the SBURA Board as consideration for future applications occurs.

The recommendation is for a maximum of $463,085 to be reimbursed to BHCC II, Inc for the identified work, including site work, storm water, water, sewer, asphalt and landscaping.

There were sufficient funds budgeted in FY25 as "unspecified development assistance" to cover this reimbursement.