The City and the Downtown Billings Partnership (DBP) annually approve an operating agreement that outlines the responsibilities of each party and compensation for managing projects in the Expanded N. 27th Street urban renewal and tax increment district.  A provision in the agreement requires that new projects be submitted for City Council approval.  On August 27th, the DBP Board approved and recommended two (2) projects: up to $15,000 to purchase a large tent and associated equipment for staging downtown street events and equally share the cost, up to $15,000, with the Tourism Business Improvement District (TBID) for a feasibility study for a privately owned and operated conference center in the vicinity of Montana Ave. and N. 27th Street.  The City Council will consider these requests at this meeting. 

The City Council may:

• Approve the DBP request for approval of two projects in FY 2011.  The DBP would be able to expend funds for the two named projects and their progress will be reported by the DBP in its quarterly and annual reports to the City.  Approval could also take the form of approving only one (1) of the proposed projects. 
• Disapprove the DBP request for approval of two projects in FY 2011.  The DBP would not be able to expend funds for these proposed projects, it would retain the spending authority for other urban renewal projects and would need to request City Council approval when it identifies those other projects. 
• Approval with less spending authority.  However, this will not work well for these projects because one project is to purchase a single item and the other requires a contract for services.  Both require a firm commitment of funds because a contract could not be executed and a purchase could not be made without adequate funding for the entire expenditure. 

The Expanded N. 27th Urban Renewal and Tax Increment District received $475,409 in tax year 2009/FY 2010.  This is almost $200,000 higher than predicted and results in a larger carryover for FY 2011.  The estimate was kept low because tax year 2009 is the first year of the six year statewide reappraisal.  The City needed to be conservative with its revenue estimation because reappraisal results are nearly impossible to predict.  Even with the lower carryover estimate, the DBP can demonstrate that it has sufficient funds for these two projects and enough remaining balance to finanance other urban renewal projects later in the year. 

Staff recommends that City Council approve the DBP request for two (2) projects in the Expanded N. 27th Street urban renewal district.  The projects are: up to $15,000 for a privately owned and operated conference center study, with the cost being equally split with the TBID and up to $15,000 to purchase a large tent and equipment for staging downtown events.