The Downtown Billings Partnership (DBP) Board has reviewed this TIF application and recommends the City Council approve up to a maximum reimbursement of $250,000, starting in the fiscal year following the year in which the project is completed, from Downtown Urban Renewal tax increment finance district funds to 1319 Ash, LLC/Widmyer Corporation for its mixed use project at 2520 1st Avenue North.

Actual reimbursement will be based upon 100% of the actual costs incurred for qualified expenses for renovation, subject to the following conditions:

1. The Applicant shall sign a development agreement with the City of Billings and DBP 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. This TIFD reimbursement is approved per the condition that it be broken down into to five disbursements of $50,000 each within five continuous fiscal years following the year in which the project is completed.
4. If funds are not available, reimbursement can be carried over to the next fiscal year

1319 Ash, LLC/Widmyer Corporation submitted an application on April 21, 2022 to the DBP requesting TIF assistance to renovate the former Montana Rescue Mission Women's Shelter building to refurbish existing apartments, add additional apartments on the ground floor, and add some retail or restaurant use on the ground floor. The project will result in a total of 28 residential units, 5 more than what the building had as a shelter and will activate the first floor on the 1st Avenue North and 26th Street North frontages. The apartments are described as mid-level market rate units.The addition of unique recessed patios/entrances to the 5 ground level units will present a neighborhood feel where there can be more eyes on the street contributing positively to public safety. The business activity will increase foot traffic at this corner complementing Stella’s, ClockTower Inn, Pub Station, and Don Luis. Furthermore, this will offer an improved pedestrian experience and additional connectivity between 1st Ave North and Montana Avenue.

The total renovation project is estimated at just over $1 million. Including the building and property value of $1.6 million, the total project is about $2.6 million. The application was vetted by staff and presented to the Development Committee on May 11 with a TIF request of $556,493. The Development Committee reviewed the proposal and made a recommendation to the DBP Board for a maximum TIF grant of $250,000. The recommendation was presented to the DBP Board via email (allowed under the DBP Bylaws) on June 9 and the DBP Board made its recommendation to City Council (See attached email summary of DBP Board discussion and questions). The reasoning for support of the application by DBP are its alignment with the elements/goals of the DBA Strategic Plan, North 27th Street Urban Renewal Plan, City TIF Policy and MCA. The reason for the Board's recommendation of less than what was requested was to best align the elements that are recommended to be funded with the public benefit and streetscape experience, and to ensure strategic management of TIF funds so that other housing and public infrastructure projects may be supported in the future per the DBP Board's strategic goals and alignment with the other guiding policy documents and regulations noted below.

The DBP Board supports the project and found it was a very strong match for accessing urban renewal funds because:

• The project addresses blight remediation (MCA 7-15-4282 through 7-15-4294 and Ordinance 12-5590) through the rehabilitation of the existing building on the site that has been vacant for several years and exceeds (@10:1) the 5:1 private to public matching fund requirements of the DBP Large Project Incentive Grant criteria and City TIF Policy (including the property acquisition). As noted above, the renovation project cost is estimated at about $1 million while the property acquisition value is $1.6 million, totaling $2.6 million with all elements.
• The project further enhances the vibrancy of Downtown Billings through revitalization of 1st Avenue North; increased public activity along 1st Avenue North and North 26th Street; enhanced pedestrian experience and safety in this area; and improved public safety through modern improvements to the fire protection and escape systems, electrical, plumbing and HVAC systems, door and window replacements, and other street level facade improvements.
• The application aligns with the issue of addressing housing in Downtown Billings and city-wide, as well as other 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 1 below and the DBP Board Recommendation document attachment).

  Table 1.

Qualified Improvements	DBA Strategic Plan	City TIF Policy	Urban Renewal Plan	Montana Code Annotated
Site work and safety - Some demolition; Concrete work for sidewalks, front patio areas Building Exterior and Facade and work - ground floor siding, windows, doors, entrance areas, lighting of the street frontage/sidewalk areas Public access and area improvements -  ground floor patio and entrance areas. Building Safety and Utility work to code - Mechanical, plumbing, electrical, HVAC	Vibrant &Connected Downtown – includes downtown living P.13 Strong Downtown Identity –P.13 Transformative Initiative - P. 15 - Increase Downtown Residential Population Through Targeted Downtown Housing Initiatives	Permitted uses of TIF Funds: Demolition and structure removal - P.2 Private infrastructure with Public Benefit and Public infrastructure –P.2 Financial Assistance Through TIF – (grants may be for for-profit businesses) P.2	Infrastructure Improvements– includes improvements to support workforce housing and loft and condo housing development - P.55 Crime Prevention and Public Safety -P.55	7-15-4202 (3) 7-15-4233 7-15-4288

 


 

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.
• 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 necessary to provide further direction to the DBP Board and staff, and City staff for future applications.

The recommendation is for up to a maximum of $250,000 to be reimbursed to 1319 Ash, LLC/Widmyer for the identified existing site and building renovations.  The estimated total project cost is about $2.6 million (property purchase included but not reimbursed), making the private to public investment ratio for this total project about 10:1. The funds are payable per the conditions of approval outlined above in the DBP recommendation, pending satisfactory submission of all paid invoices showing actual cost incurred for the project, and per the reimbursement being broken down into to five disbursements of $50,000 within five continuous fiscal years following the year in which the project is completed. If approved, payments will be incorporated into future year budgets, the earliest is expected to be FY24. Current estimates of the future Downtown District revenues are able to cover this project in FY24 as well as support known future planned projects and bonding.