County officials want the public to know that a planned Uptown parking garage will not be funded through increased taxes.
But the parking garage will be paid for with property tax dollars from an Uptown tax-increment financing district, and the final cost could still be $7.5 million — $500,000 more than the $6 million to $7 million figure officials had held to for months.
Community Development Director Karen Byrnes told the Urban Revitalization Board on Tuesday that the final price tag for the garage could be $7.5 million.
Byrnes said the additional $500,000 could result from soft expenses that included costs for designing, engineering, purchase of the property off of Park Street and development agreements with owners of two adjacent properties.
Those were different than the “hard costs” of constructing the building, she said, but county officials had not proclaimed that distinction for this or other major public projects in the past few years.
Byrnes said a story about the project and its costs in Tuesday’s editions of The Montana Standard did not make it clear where funding for the garage would come from.
Previous stories did, noting that bonding for the garage would be backed by new property tax revenue from the Uptown tax-increment financing district (TIF).
As some previous stories about that district have noted, TIFs alone do not mean tax increases.
They only capture property taxes paid on building improvements and new developments in an area so the money can be reinvested in that area. Without a TIF, the additional tax dollars would be doled out to all taxing units such as schools and local governments.
An Uptown TIF in place since 1980 expired in June 2014 and a new one was drawn and established.
Under that, any additional tax dollars paid because of building improvements — anything from a deck added to a house to the new NorthWestern Energy headquarters — are captured. It is that revenue — now and in future years — that will be used to back the bonds and pay them off, whether they are floated by one or many lending institutions.
But that revenue results from added developments, not tax increases, and tax dollars outside the Uptown TIF district won’t fund any part of the garage project.
Although URA board member Bob Brown questioned the higher dollar figure Tuesday, the board was and has been complimentary of the planned parking garage and how the project has unfolded. Some commissioners, however, have criticized the process.