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Citing public good, Missoula City Council adopts MRA’s budget

The Missoula City Council’s residual conservative wing and its first Democratic socialist member attempted but failed Monday night to stop the passage of the Missoula Redevelopment Agency’s Fiscal Year 2021 budget, despite the implications for the city’s general fund in 2022.

The Missoula City Council accepted a resolution regardless of revising MRA’s budget, including final estimates based on increased taxable values from the state, their implications on mill levies, projected grants, and bond revenues, by an 8-3 vote.

Every year, the vote is held, but the council’s new socialist member and the remaining conservative group vote against it. In recent weeks, the two political factions have unified in opposition to several initiatives, but none have been successful.

Daniel Carlino, who barely defeated Dori Gilels in Ward 3 and is now a member of the Consolidated Planning Board, proposed using tax increment financing to develop the $25 million AC Hotel in downtown Missoula.

The initiative provided scores of additional employment in the city and, like the Mercantile next door, allowed for company development and relocation. It was backed by downtown enthusiasts and envisioned in both the previous and most current Downtown Master Plans approved by the general public.

Nonetheless, Carlino was opposed to the project even though it took place years ago.

“I feel Marriott should pay its fair part for walkways and utility relocation,” Carlino stated in opposition to the proposal. “I’m apprehensive about the (money) provided by MRA to Marriott for demolition and cleanup.” Deconstruction, in my opinion, should become a standard requirement since it is required to accomplish our city’s waste reduction objectives.”

State law does not allow the city to demand deconstruction over destruction. Instead, Missoula has utilized tax increment within eligible areas to encourage material research and salvage in recent years, which has garnered widespread approval.

According to a 2020 municipal study, tax increment financing in Missoula also built 15 miles of sidewalks, 10 miles of roadways, and several new companies, making it a viable tool for finishing public infrastructure and encouraging economic growth.

Missoula had had the program in place since the 1970s when the Missoula Redevelopment Agency created the city’s first urban renewal area downtown after the establishment of Southgate Mall.

MRA spent about $20 million in tax increment into the downtown area as firms fled to the new suburban hub. Throughout the district’s existence, that initial investment generated an additional $200 million in private money, assisting in transforming downtown Missoula into the corner it is today and bolstering the city’s general budget.

Missoula Mayor John Engen, City Council members and the larger business community support such investments restricted to public infrastructure under state law. It cannot be utilized for private development, but it may supplement an asset that a developer would not otherwise be obligated to make.

Engen reacted angrily to Carlino’s ill-advised assault on tax increment financing, claiming Monday’s vote was about the budget, not TIF finance. Other council members agreed with the proposal.

“We have an audit coming up, and we need to finish this so we have all the I’s dotted and T’s crossed,” said Gwen Jones, who also represents Ward 3. “These are the final figures that come in. As projects progress.” We now have concrete data. “I’m in favor of it.”

Other members of the City Council backed the approved MRA budget – as well as the agency’s operations. They claim that Missoula would be a different place without the agency’s attention and commitment.

“I want to emphasize how crucial tax increment money has been in the public good,” said Jennifer Savage, a council member. “I spent the greater part of last summer researching about tax incrementation, and I now believe it’s ultimately for the public interest.”