The Downtown Billings Partnership (DBP) Board has reviewed this TIF application and recommends the City Council approve up to a maximum reimbursement of $50,000 from Downtown Urban Renewal tax increment finance district funds to Big Sky Economic Development Authority for facade restoration and sidewalk hardscaping at its new offices and entrepreneurial development center at 201 North Broadway.

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

1. 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.
2. If funds are not available, reimbursement can be carried over to the next fiscal year.

Located in the heart of downtown Billings and at the northeast corner of the intersection of Broadway and 2nd Avenue North, the Montana National Bank building, as listed on the National Register of Historic Places, has been a staple to the City of Billings since 1918. Occupied in recent years by Buchannan Capital, The Billings Symphony, and Zoot Enterprises as a datacenter, the space has been largely underutilized. Big Sky Economic Development (BSED) purchased and is currently renovating the building. The space will become an entrepreneurial center, incubating and accelerating businesses within Yellowstone County and the City of Billings, a business training space, and the new BSED offices will be on-site to continue its mission of growing the region’s economy and quality of life.

This overall renovation will total nearly $4.6M and represents a significant commitment by BSED to the health and vibrancy of downtown Billings. This new space will provide the Rock31 program the facilities it needs to be successful. Rock31 is a new hybrid solution to entrepreneurial development where incubation services, acceleration programming, and co-working space all meet to serve individuals ready to connect with experts, build their concept and grow. This will drive economic diversity through the start and growth of innovative businesses; lead entrepreneurial development and programming; expand the ability to create high quality jobs in our community; and catalyze private investment, all under Sky Point and the core of downtown Billings.

The maximum eligibility of a facade grant is not to exceed $50,000, and a 3:1 match must be provided by the applicant. The facade project that is the subject of this TIF request involves the restoration of the stonework of the facade and the hardscaping of the sidewalk. Those improvements will enhance the pedestrian experience and contribute to the public safety of this corner as well as protect the integrity of an iconic building. Protecting historic buildings and activation of otherwise dark vacant spaces are elements of the Urban Renewal Plan and DBA Strategic Plan. BSED’s other exterior investments beyond this facade grant include installing lighting consistent with CPTED best practices and exterior lighted signage for safety and wayfinding purposes. The overall exterior/facade work in the application attached shows a total of $186,443. However, the applicant also will be installing additional hardscape and exterior improvements which were left out of the application total. The additional improvements listed below in the main categories bring the total to $202,963, making the request for up to $50,000 meet the 3:1 matching ratio for these requests, per DBP guidelines. The DBP Board recommendation was updated to include all the facade improvement elements and breaks out the categories further, but also shows that only three areas of work are included in the facade grant recommendation for funding - Sidewalk repair, facade repair and cleaning. Here are the main categories:

• Design= $6,000
• Permits = $4,275
• Windows = $13,897
• Doors/entry = $22,550
• Facade Restoration and Repair = $25,050 (Includes additional cleaning and repair work)
• Hardscaping (sidewalk) = $26,162
• Lighting = $23,111
• Other = $81,918 (Includes additional cleaning, signage, lights)

Renovating a century-old building comes with significant costs, including many updating or code-modernization efforts. Recent, unforeseen building challenges have impacted the BSED building budget. Due to these challenges, BSED is applying to the DBP facade grant program to support critical public-benefit elements on the exterior of the building.

The application was vetted by staff and presented to the Development Committee on June 3. The Development Committee reviewed the proposal but four members had to recuse themselves due to conflicts of interest. The remaining three members that could vote ended up with a mix of one in support, one against it, and one member indifferent. Therefore, the committee forwarded the application to the full DBP Board for review and action at a special meeting on July 15 without a full recommendation and full committee endorsement. The DBP Board reviewed the application and made its recommendation to City Council to approve the application. Since the meeting took place after the final memo deadline for the City Council meeting on July 25, staff was not able to provide full minutes of the meeting for this memo. Additonal information on the DBP Board discussion may be provided at the July 25 meeting.

The DBP Board supports the project 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. The maximum facade grant application amount is $50,000, so this application is well within the facade grant requirement of a 3:1 private to public matching fund requirement for these grants. In this case, the total exterior/facade project is $202,963 and the request is for up to $50,000, or a 3:1 ratio. As noted above, the total renovation project cost is estimated at about $4.6 million.
• The project further enhances the vibrancy of Downtown Billings through revitalization of the intersection of Broadway and 2nd Avenue North; increased public activity along the street frontages; enhanced pedestrian experience and safety in this area; and improved public safety through street level facade improvements.
• 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 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 Building Exterior Facade and work - brick and limestone Public access and area improvements -	Vibrant &Connected Downtown – P.13 Strong Downtown Identity –P.13	Permitted uses of TIF Funds: Demolition - P.2 Private infrastructure with Public Benefit and Public infrastructure –P.2	Business Recruitment and retention - P. 54 Infrastructure Improvements– P. 55 Crime Prevention and Public Safety -P.55	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 $50,000 to be reimbursed to Big Sky Economic Development Authority for the identified building facade improvements. The estimated total exterior/facade project cost is $202,963, making the required 3:1 match for these facade grants. The funds are payable per the conditions of approval outlined above in the DBP recommendation and pending satisfactory submission of all paid invoices showing actual cost incurred for the project. If approved, payment will be incorporated into the current FY23 budget with an amendment as needed. Current estimates of the future Downtown District revenues are able to cover this project in FY23 and FY24 as well as support known future planned projects and bonding.