"I wanted to take the opportunity to address some difficult issues with regard to HB 213. The raising of the first $100,000 of market value of class eight property of a person or business entity to be exempt from taxation may sound like a good idea from the outset. However it will damage the ability of a TIF District to construct much needed public infrastructure which in turn creates jobs and raises the taxable valuation of a site that otherwise may have not been generating any tax revenue or very little.
Let me give you an example, here in just to the east of Missoula next to the Blackfoot river in a town called Milltown once stood the mighty Champion plywood plant. They have an all wooden building there that is seven acres in size, at one point in the 1970's it was the largest standalone wooden structure in the United States. Then the lumber business couldn't sustain itself and the mill site shut down in 2008. In 2012 two local men bought the site with the vision to bring back jobs. The site is 82.27 acres in size and they have brought a wood chipper to occupy the southern portion of the site, Northwest Paints occupies some of the other structures and most recently they have brought in a trailer manufacturing business who plans to double their current production by the end of the year adding another 66 employees. Despite all this great activity we have only seen an additional $121,676 in additional tax increment over the base of $92,341 when the TIF was started. They are in need of public infrastructure to maintain their growth specifically a railroad spur, high intensity lighting, sewer system and some site preparation work so the once deserted millsite can continue to grow and employ the people of Milltown who are once again taking pride in their community. To generate the taxes needed to borrow the funds to fund the infrastructure will take some time as more equipment is added and improvements are made to the site. A $500,000 exemption would have the effect of taking $13,500,000 of tax increment financed public infrastructure away from the former Millsite. I do not think the tax exemption is going to have the desired outcome if the purpose is to stimulate business at least not in this case."
The revised HB 213 is much better. The bill provides for growth in the Entitlement Share reimbursement that wouldn't be as great as the the growth in the Class 8 equipment but it is a bill we can live with. Missoula County can support it at this point.
Andrew Czorny on Jan. 27, 2015:
ReplyDelete"I wanted to take the opportunity to address some difficult issues with regard to HB 213. The raising of the first $100,000 of market value of class eight property of a person or business entity to be exempt from taxation may sound like a good idea from the outset. However it will damage the ability of a TIF District to construct much needed public infrastructure which in turn creates jobs and raises the taxable valuation of a site that otherwise may have not been generating any tax revenue or very little.
Let me give you an example, here in just to the east of Missoula next to the Blackfoot river in a town called Milltown once stood the mighty Champion plywood plant. They have an all wooden building there that is seven acres in size, at one point in the 1970's it was the largest standalone wooden structure in the United States. Then the lumber business couldn't sustain itself and the mill site shut down in 2008. In 2012 two local men bought the site with the vision to bring back jobs. The site is 82.27 acres in size and they have brought a wood chipper to occupy the southern portion of the site, Northwest Paints occupies some of the other structures and most recently they have brought in a trailer manufacturing business who plans to double their current production by the end of the year adding another 66 employees. Despite all this great activity we have only seen an additional $121,676 in additional tax increment over the base of $92,341 when the TIF was started. They are in need of public infrastructure to maintain their growth specifically a railroad spur, high intensity lighting, sewer system and some site preparation work so the once deserted millsite can continue to grow and employ the people of Milltown who are once again taking pride in their community. To generate the taxes needed to borrow the funds to fund the infrastructure will take some time as more equipment is added and improvements are made to the site. A $500,000 exemption would have the effect of taking $13,500,000 of tax increment financed public infrastructure away from the former Millsite. I do not think the tax exemption is going to have the desired outcome if the purpose is to stimulate business at least not in this case."
Andrew Czorny on Mar. 20, 2015:
ReplyDeleteThe revised HB 213 is much better. The bill provides for growth in the Entitlement Share reimbursement that wouldn't be as great as the the growth in the Class 8 equipment but it is a bill we can live with. Missoula County can support it at this point.