// 2022 TIF RE-DO AFTER UNNOTICED NULLIFICATION

City Council will vote tonight on re-approving a $745,000 tax increment financing approval for the Old Billings Hardware Building project that was originally approved in 2022 but stalled due to funding and logistics complications.

The mixed-use development at 2802 Montana Avenue will transform a vacant historic building into 24 residential units plus ground-floor commercial space. The project represents an 11-to-1 private-to-public investment ratio and will quintuple the property's annual property tax contribution from $10,000 to $54,000.

While three years have passed since initial approval, the developers are now ready to move forward with construction starting in late fall 2025. Project costs have risen from $7.4 million to $8.6 million since the original projections, but the TIF award amount remains unchanged at $745,000.

The delay stemmed from challenges securing financing and losing a key commercial tenant, but developers report optimism about finding an interested local lender and have applied for funding.

Unnoticed nullification?

Council originally approved this TIF award in September 2022 with a condition requiring the developer to sign a development agreement within 365 days. However, financing hurdles prevented meeting the 2023 deadline. City staff discovered the expired timeline condition when the developers recently contacted them to execute the development agreement. A review by the City's legal staff determined that a re-approval of the TIF application was necessary before moving forward with a development agreement.

A look back

A graphic with preliminary image we included with our 2022 Council Bulletin highlighting this project. 

Why it matters: Crime prevention & housing

Downtown Billings needs more housing supply to meet market demand and interest, and this project adds 24 units in the urban core.

• Downtown hosts a substantial number of folks who work there everyday but absent housing and 24/7 downtown residents our businesses miss out on potential shoppers and patrons

The development activates a long-vacant historic building that currently contributes little to downtown vibrancy or public safety.

• More people living downtown = more "eyes on the streets"
• Natural surveillance deters would-be criminals and is a key component in Crime Prevention Through Environmental Design (CPTED), which is a cost-effective way to improve safety without adding government costs.

Timeline

• September 8, 2025: City Council vote on TIF extension
• Within 60 days of approval: Developer signs development agreement
• Late Fall 2025: Construction begins
• Fall 2026: Project completion anticipated
• FY27: First TIF reimbursement payment expected
• Years 2-5: Remaining annual reimbursement payments of $149,000 each

By the numbers:

• TIF funding request: $745,000
• Project cost (without land cost): $8.6 million total project ($6.6 million construction)
• Ratio of private to public funds: 11:1
• Adding tax base: Property value increases from $374,778 to $4.3 million; annual taxes rise from $10,000 to $54,000
• Housing units: 24 total (12 one-bedroom, 12 two-bedroom)

Follow the Money

TIF funding can only be used toward certain expenses outlined in state statute. Below is a table outlining the qualifying expenses (QEs) for the project, which was submitted in 2022.



• Of note: the project cost has increased since then, but the TIF request remains the same.

Notable Quotables

Project Update Document: "The TIF award ($745,000; 1:8 match) is a crucial part of this project's capital stack; given the high interest rates and current construction costs, this project would not be financially feasible without this TIF award."

Mehmet Casey, DBP Development Director (in 2022 letter to Wyeth Friday, City PCSD Director): "This density will add more shopping capacity, potential workforce for businesses, natural surveillance to enhance safety, and new downtown visitations of the new businesses."

The bottom line

This project transforms a vacant historic building into a downtown safety, housing, and tax-generating asset. It's a piece of the puzzle for improving our downtown and helping our businesses thrive. 

// BUSINESS MEETING AGENDA - 5:30 p.m. - BILLINGS CITY HALL

In this section, we will include the meeting agenda for you to view. Clicking on the items will take you to more information. No need to read it all, but if something catches your eye, be sure to check it out.

PROCLAMATIONS: September 21, 2025 - Suicide Prevention Day 

COUNCIL REPORTS: 

ADMINISTRATOR REPORTS - CHRIS KUKULSKI 

PUBLIC COMMENT on “NON-PUBLIC HEARING” Agenda Items: 1 and 4 ONLY. Comments are limited to three (3) minutes or as set by the Mayor.

1. CONSENT AGENDA -- Separations: 

A. Bid Awards: 

1. City Vehicles. (Opened 8/19/25) Recommend Laurel Chevrolet (three vehicles); Rogers Motors (four vehicles); and Billion Auto Group (two vehicles). 

B. Purchase of two Airport Rescue Fire Fighting (ARFF) trucks; Rosenbauer Minnesota, LLC. 

C. Purchase of one Toolcat UW56 for Public Works; Bobcat of Big Sky. 

D. Agreement for Microsoft Enterprise/Volume Licensing; SHI International Corp. 

E. West End Hangar Ground Lease with Experimental Aircraft Association Chapter 57, Inc.  

F. West End Hangar Ground Lease with Belix Investments, LLC.  

G. West End Hangar Ground Lease with Robert C. Bryan and Phyllis C. Bryan. 

H. Amended Plat of Southgate Subdivision, 1st Filing. *Quasi-Judicial 

I. Bills for the Weeks of: 

1. August 11, 2025 

2. August 18, 2025  

REGULAR AGENDA: 

2. PUBLIC HEARING AND RESOLUTION setting Special Improvement Lighting Maintenance District (SILMD) assessments. Staff recommends approval. 

3. PUBLIC HEARING AND RESOLUTION setting and assessing Encroachment Rental fees. Staff recommends approval. 

4. TAX INCREMENT FINANCING ASSISTANCE EXTENSION from the Downtown Urban Renewal TIF District for Old Billings Hardware Development Venture, LP for its mixed use project at 2802 Montana Avenue, up to $745,000. Downtown Billings Partnership (DBP) Board recommends approval.

PUBLIC COMMENT on “NON-AGENDA ITEMS”. Speaker Sign-in required. (Restricted to ONLY items not on this printed agenda. Comments are limited to 3 minutes or as set by the Mayor. Please sign the roster at the cart located at the back of the Council chambers or at the podium.) 

COUNCIL INITIATIVES: Residency Requirements for Department Heads - Councilmember Kennedy 

ADJOURN:

// WATCH THE MEETING ON COMMUNITY 7 TELEVISION

// CITY ADMINISTRATOR WEEKLY REPORT

City Administrator Chris Kukulski began the routine of sending a weekly report every Friday to City Council and department heads with the intent to, "communicate the highlights of the past week and any critical issues coming up." The most recent CA Report includes updates on:

• County's response to Council's tax statement clarifications (re: HB 231)
• Public Works construction updates
• And much more...

// GET MORE INVOLVED IN YOUR COMMUNITY

Below are some additional public meetings being held this week, along with information about when and where to attend.

🔸 Monday, September 8th

Energy and Conservation Commission Meeting

3:00 - 4:00 pm, 2251 Belknap Ave.

🔸 Tuesday, September 9th

Yellowstone County Planning Board

4:30 - 6:30 pm, Council Chambers, 5th Floor, New City Hall, 316 N. 26th St.

Midtown Community Collaborative Task Force

7:00 - 8:00 pm, Black Dog Coffee, 1528 N. 24th St.

🔸 Wednesday, September 10th

City Council Budget and Finance Committee

9:00 - 11:00 am, Rimrock Room, 5th Floor, New City Hall, 316 N. 26th St.

Parking Advisory Board

2:00 - 3:00 pm, Rimrock Room, 5th Floor, New City Hall, 316 N. 26th St.

City Council Legislative and Local Affairs Committee

9:00 - 11:00 am, Rimrock Room, 5th Floor, New City Hall, 316 N. 26th St.

🔸 Thursday, September 11th

Billings Tourism Business Improvement District

8:30 - 10:00 am, Billings Chamber of Commerce, 815 S. 27th St.

9-11 Memorial Ceremony at MSU Billings

8:30 - 9:30 am, City College, Health Sciences Bldg, 3803 Central Ave.

Library Board Meeting

12:00 - 1:00 pm, Billings Public Library, 2nd Floor, 510 N. Broadway.

// THE SQUEAKY WHEEL

// BOARD & COMMISSION OPENINGS

The Mayor's Office is accepting letters of interest to fill the vacancies listed on the city website. For more information on each specific board, visit the city website. City Boards and Commissions are appointed by the Mayor, confirmed by City Council, are advisory only, and members serve without compensation.

Submit applications to: Mayor's Office, PO Box 1178, Billings, MT 59103-1178.

The DEADLINE for applications is October 6, 2025.

BOARD OPENING (SEATS)

EBURD Advisory Committee (6)

Downtown Urban Renewal District (4)

SBBURD Advisory Committee (7)

REQUIREMENTS

At Large*

At Large*

At Large*

*— Must own, operate, or represent a business, property, or organization in the District or who otherwise have a significant vested interest or presence in the District. Two of the EBURD’s members must be owners or occupants of residential property in the District.

// IN CASE YOU MISSED IT - AI SUMMARY AND SOURCE LINKS

In this section we re-visit last week's meeting, providing:

• an AI summary (YouTube transcript analyzed by Claude's Sonnet 4) 
• links to the Community 7 video 
• draft minutes produced by city staff (if available) 

We'll revise and edit when necessary for clarity, brevity, and to avoid inaccuracies, which are sure to happen on occasion. And, considering the difficulty Council has had with audio feeds, it's likely that some comments or segments of the meeting will be missed in the video transcript.

Billings City Council Business Meeting - September 2nd, 2025

Overview

The Billings City Council held a work session focused on two major urban renewal initiatives. The primary discussion centered on a proposed expansion of the South Billings Boulevard Urban Renewal District (SBBURD) that would nearly double its size, adding almost 1,600 properties to the existing 2,300-property district. The Council also addressed new state-mandated advisory boards for the city's three tax increment financing (TIF) districts, though no final decisions were made on board appointments.

Council Actions and Directions to Staff

• Approved motion to proceed with SBBURD expansion analysis - Council voted to direct staff to move forward with the expansion process, with all members voting in favor except Council member Neese who opposed
• Directed staff to continue work on advisory board agreements - Staff will return in October with draft agreements for the three new TIF district advisory boards
• Set timeline for expansion process - Resolution of intent scheduled for September 22nd, community meeting October 9th, and public hearing October 27th

Key Council Member Quotes

Councilwoman Kendra Shaw: "I think we're smart to try and jump ahead of that train," regarding using existing TIF capacity rather than starting a new district and waiting on the slow buildup of increment.

Council Member Roy Neese: "My big concern with going down this direction wasn't that the expansion area doesn't need TIF. Absolutely it does. My concern is that there's not enough time remaining in the TIF life cycle to affect all the change that we need to."

Council Member Bill Kennedy: "All of that area should have been included in the SBURA years ago. It's a blighted area... This is an opportunity to really grow the Southside."

Council Member Scott Aspenlieder: "What I don't want to do is start the narrative and create this characterization that we're only doing this so that we can build a pool. This is the SBURA expansion for the Southside."

Public Input

Kevin Nelson raised concerns about legal compliance, referencing state code and alleging the city didn't follow proper procedures in a previous district expansion.

Dick Zeir, SBBURD representative, emphasized the importance of appointing engaged board members: "Have somebody that's really interested in it because we got a lot of good things going down there and we want to keep the momentum going."

Meeting Statistics

• Duration: Approximately 1 hour and 47 minutes
• Most active speakers: Mayor Cole (moderating), staff presenter Wyeth, Councilwoman Shaw, and Council Member Kennedy
• Attendance: Councilwoman Shaw and Councilwoman Owen joined via Zoom, and Councilman Gulick was excused

Additional Notable Items

The meeting opened with City Administrator Chris Kukulski addressing ongoing issues with TDS contractor damage to park irrigation lines, with repairs and accountability measures being pursued. The Council also discussed the challenge of balancing the South Park Pool project with other infrastructure needs given the district's 2046 sunset date, and debated whether council members or outside experts should serve on the new state-mandated advisory boards. The expansion would create a continuous corridor connecting all three of the city's TIF districts and encompasses approximately 93 acres, representing about 3% of the city's total area.

// ADDITIONAL BILLINGS CHAMBER RESOURCES

// BUSINESS ADVOCACY SPONSORS