After several years of doling out $65,000 or so in tax money to festivals and other projects, Butte-Silver Bow commissioners are eyeing a new plan that some say could produce more economic development per dollar.
But not all commissioners are buying into it. Not yet, anyway.
Under the plan, the Butte Local Development Corp. would get money from the county’s economic development mill levy and steer the bulk to one or more businesses that shows promise in creating and supporting jobs.
Applicants would have to provide detailed financial information and business plans and meet with BLDC staff monthly to show progress and results in meeting benchmarks, said BLDC Executive Director Joe Willauer.
“We are not going to let someone apply for this grant, give us a two-page application, and we say, ‘Here is some money,’” Willauer told commissioners Wednesday night in pitching the plan.
The BLDC would use 10 percent of the money each year to administer the program, get $20,000 for general operations, and give the rest to Butte small businesses and entrepreneurs. The county currently pays the BLDC $46,000 a year to support its efforts.
The BLDC got the mill money, which hovers around $65,000 a year, when voters approved the levy in 1990, officials say. But the county took it back in the mid-’90s, and for the past several years, commissioners have decided where it goes.
Butte’s summer festivals — including the Montana Folk Festival and An Rí Rá — typically get a slice, and so does Advantage Butte, a group that bids for and hosts sports tournaments here. The BLDC usually gets a share, too, for initiatives it supports. It got $12,500 last year.
But numerous others have also gotten money, including the Miner’s Hotel, World Museum of Mining, Greeley Neighborhood, Butte Historical Society, and many causes and small business ventures. Commissioners divided nearly $64,000 among 15 applicants last year, with six getting $1,500 or less.
Commissioner Dan Olsen said commissioners steered $10,000 in 2017 to someone wanting to produce a cooler to compete with the popular YETI ice cooler, but no result.
“I have not been real happy with the way the money is handed out,” said Olsen, now chairman of the council’s Economic Development Committee.
On some things, he said, “It seems like we are throwing that money away.”
He said the BLDC has the staff and expertise to direct the mill money toward ventures that have business and marketing plans and can succeed. Festivals bring in visitors, he said, but they have other available funding sources, such as local hotel taxes.
Willauer said the BLDC already is committed to economic development. It provides technical assistance, administers small business loans, grants funds, and partners with county and state commerce officials and Montana’s congressional delegation, he said.
The BLDC helps host economic outreach events, including several happening this week in Butte. Such events have included a young professional leadership symposium, small business and entrepreneur training, and a workforce fair and employer reception set for Friday.
And the BLDC helps recruit businesses.
Willauer said FCR, an Oregon-based provider of call center and other business services, first reached out to the BLDC about possibly opening a new office in Butte. Its call center in the Butte Plaza Mall is now expected to create 350 or more new jobs.
Willauer said applicants for the mill levy money would have to make detailed pitches.
“They will have to stand up and say, ‘This is our thought process, this is why we want to do this, and this is why we will be successful,’” he said.
Recipients would then have to meet with BLDC staff once a month. The BLDC, in turn, would report to commissioners as often as commissioners wanted, Willauer said.
The $20,000 for operations each year would be added to the $46,000 the BLDC gets directly from the county, but Willauer said the total is still far below what similar organizations get in other cities, including Billings, Missoula, and even Havre.
Some commissioners said they backed or were open to the new plan.
Brendan McDonough, a big supporter of the annual An Rí Rá festival, said the $3,000 to $4,000 that festival gets each year in mill levy money might better be spent on bringing new businesses to town. The festival could then seek contributions from them, he said.
Commissioner Josh O’Neil said a 10-percent administrative fee seemed too high, but he liked the overall idea, including a more stringent application process.
Commissioner Shawn Fredrickson said last year’s allocation process didn’t go well.
“There is no one to blame on this council,” he said. “We just don’t have the time and the resources to administer this money.”
But some commissioners — including Bill Andersen, Jim Fisher, and Cindi Shaw — questioned the plan.
Shaw and Fisher said the festivals and sports tournaments that get mill money were big in Butte. Shaw, who is on the BLDC board, called them “huge economic drivers,” and Fisher said they equate to advertising “you can’t buy.”
“I’m not ready to give up on this — at least not today — to give up the authority we have on this (levy) just because we had a couple of bad years,” Shaw said.
John Morgan, chairman of the council, said he had reservations about allowing the BLDC to take $20,000 a year for operating expenses without there being benchmarks regarding how it gets spent.
“The public needs to know where that money is going,” he said.
The BLDC plans to submit a formal request for the plan in time for the council’s next meeting, May 15.