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The city of Missoula stepped in on Thursday to pledge taxpayer dollars to help ensure there’s a fourth floor with public meeting spaces on the soon-to-be-built new Missoula Public Library downtown.

After a lengthy debate, the Missoula Redevelopment Agency’s Board of Commissioners unanimously approved giving the library’s board of trustees a total of $500,000 in Tax Increment Financing from the Front Street Urban Renewal District.

The money, which includes $200,000 in cash now and a pledge of $300,000 in the future, comes from property tax revenue generated in the district that is diverted away from the city’s general fund. The money will only go to the library as long as new projects currently under construction in the district, including the Mercantile hotel, Roam Student Living and high-end townhomes, generate enough new property taxes.

According to Mae Nan Ellingson, a retired public finance lawyer and the library board’s accounting expert, the firm they hired to perform the design and engineering plans for the library told them last fall that the roughly $35 million budget wasn’t going to be enough to cover the project that the board envisioned.

“We were about a million and a quarter over what they could deliver,” she explained. “One of the logical ways to cut costs was removing the fourth story. But as someone who wanted it to be an iconic establishment downtown, I was not willing to let go of that fourth floor.”

The fourth floor has been designed to have an event space that would house 250 people, an expansive view to the south with perhaps an outdoor deck, a reception area and a boardroom. Mayor John Engen said he and city chief administrative officer Dale Bickell believe that having the MRA pledge the money will not jeopardize future projects because although the district is running low on money now, it should see a significant increase in the next few years.

Ellen Buchanan, the executive director of the MRA, said the Montana Department of Revenue’s valuation of the land where the Mercantile hotel is being built was more than she expected, so that commercial property will probably generate more property taxes than expected when it comes fully online in January.

“We felt this was a reasonable ask and a reasonable participation in what’s going to be just an iconic landmark for downtown that’s going to serve not only Missoula but all of Missoula County,” Ellingson said. “We really need your help to enable us to build the fourth floor on this library.”

Missoula County voters approved a $30 million bond in 2016 for the new building, which will be constructed starting this fall directly to the east of the current library on Main Street. The Missoula Public Library Foundation had raised $4.75 million in private funds before the MRA vote on Thursday and had raised $5.25 million by the end of the day. The capital campaign's goal is $5.65 million.

The 105,00-square-foot building, which should open in 2020, will also house Missoula Community Access Television, the spectrUM Discovery Area, the Families First Children's Museum and a cafe.

Buchanan said she’s not sure what local businessman Terry Payne intends to do with the land where the current library sits. He and the library completed a land swap so that the current library can remain open while the new one is being built, but he hasn’t said what he intends for the property once it’s vacant.

Geoff Badenoch, a member of the library foundation, said he has seen the Missoula community reap the benefits of investment in public infrastructure over the years. He cited Caras Park as an example.

“The new Merc hotel and the new student housing, those facilities are going to sell themselves using our library,” he said. “They’re going to use pictures and show residents and guests, ‘This is why you are going to love living here.’ This is the most expensive public project undertaken downtown, more than all of our parks (downtown) put together. This is the most important public structure built downtown in the foreseeable future. You are making a small investment in a project that is going to bring dividends to Missoula County for the next two or three generations.”

Engen expressed his support as well.

“Whether it is an art park or a baseball stadium, there are always unexpected costs and consequences and difficult choices to make,” Engen said. “This is a function of timing more than anything in my opinion. If this request would come two years from now when we have more revenue in the district. … From my perspective, there’ll be funding not only to take care of this pledge and funding available to take care of (downtown) planning projects. My sense is this district is going to be enormously successful.”

Natasha Prinzing Jones, a member of the MRA board who was appointed by Engen last fall, asked Ellingson if there were other options.

“Whether you call it debt or a pledge, it still ties our hands,” she said. “We will feel morally obligated to live by that pledge. It seems to me it significantly limits our ability to participate in other projects. The amount you’re asking for is very great, but what we’re doing to help you overall on your project is very small.”

Ellingson said she didn’t want to have to raise funds for another six years. She also said that she would be “heartbroken” if the MRA didn’t support something “with as much long-term impact to the vitality of downtown.”

Badenoch reminded the board that the library didn’t request any TIF funds for public improvements to the site, such as new sidewalks, demolition of blight, and utility work. He also said that the MRA is getting the money from taxpayers in the district who are being assessed for library bonds.

“This project ticks off everything (on the list) the MRA is doing in the district,” he said. “We eliminated a block of blight and we’re going to give you four block faces of new sidewalks.”

After that, the board approved the request, adding a stipulation that the MRA staff will work with the library foundation and the city’s bond counsel to create a pledge for the $300,000 that does not constitute debt.

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