The county’s planned parking garage in Uptown Butte could cost up to $7.4 million to build, but that price tag shouldn’t go any higher, a top city-county official said Monday.
Sletten Construction, the project’s primary contractor based in Great Falls, can only exceed that “guaranteed maximum price” if county officials order up added features to the 248-space garage on West Park Street, said Community Development Director Karen Byrnes.
The Urban Revitalization Agency’s board could approve the maximum construction cost Tuesday and commissioners are being asked Wednesday to authorize an $8 million bond to fund the project.
That bond figure is higher because it will cost $120,400 to issue the bond and it requires that about $556,000 be set aside in a reserve fund. The latter amount is about what the annual payments will be on the bond over 23 years, and once it’s paid off, the reserve money goes back to the URA.
If the URA board and council approve the measures, Byrnes said, “We think there is probably going to be (construction) activity within the next week.”
A formal groundbreaking ceremony at the site at 60 W. Park Street likely would be held in a few weeks.
The garage is being funded with property tax revenue from the county’s Uptown tax-increment financing district (TIF), which was redrawn and reauthorized in 2014. The TIF does not increase taxes, it simply captures property tax revenue created when new developments in an area add tax value.
And it appears the TIF will bring in much more tax revenue each year -– about $962,000 -– than will be needed to make annual payments on the bond. That’s good news, since the additional revenue can be used in grants and loans for other development projects Uptown.
It was once thought the garage might gobble most of the new TIF revenue, at least for several years. Much of that revenue is from NorthWestern Energy’s new $25 million Montana headquarters building at Park and Main streets.
The county used a state- and local-authorized no-bid process for the first time to select Sletten as the primary builder, although it will hire numerous subcontractors to help.
Commissioner Jim Fisher has questioned that process, saying the project should have been bid out. But Byrnes says it allows designers and builders to collaborate on a project along the way to hold down costs. And that has already occurred, she said.
When Sletten officials discovered that some foundation drilling and column-work costs would be really high, Byrnes said, they sat down with the project’s design engineers – Pioneer Technical of Butte.
“They came up with a whole different plan and that probably saved about $450,000,” she said.