In $3.6 million Merc giveaway, MRA is poor negotiator

By Dan Brooks in Self-Promotion 0 Comment

The Marriott hotel envisioned on the site of the former Missoula Mercantile building

Residents of Missoula and its partisans abroad know about the years-long saga that is the Mercantile. A Macy’s as recently as 2011, the historic downtown building sat vacant for six years, thwarting various development plans until HomeBase Montana offered to knock it down and build a Marriott in its place. The city’s Historic Preservation Commission denied that permit, in what might politely be called a complex process. The city overruled the committee, and HomeBase demolished the Merc in April. Then, at the end of June, the Missoula Redevelopment Agency voted to give the project $3.6 million in tax increment financing.

It was not a bailout. Most of the TIF money reimbursed the developers for stages of the project that had already happened: $1.5 million for “deconstructing” the building by reclaiming its materials instead of demolishing it outright, $336k for preserving the old pharmacy, and $150k in reimbursements for asbestos removal. All these were conditions of the original deal, which HomeBase had already met without running into cash-flow problems. Any suspicion that the project might need our $3.6 million to survive was erased by developer Andy Holloran, who told the Missoulian the hotel would generate more property tax revenue than expected because developers had “added $5 million more to the total project costs, including 27 more rooms than the original design.”

What, then, did the city of Missoula get for its $3.6 million? The things we bought—deconstruction, asbestos abatement, the pharmacy, and a guarantee the project would move forward—were already ours. This TIF money neither extracted concessions from the developers nor saved the project. So is the MRA saying that paying $3.6 million to expand the project was a wise investment, because a bigger hotel will generate more tax revenue? If so, that’s a new vision of the agency’s function. Historically, the MRA has acted to encourage new development projects, not invested in ones that were already underway.

A lot of public money went to a private business venture in this deal. Given how little the public seems to have gotten, its worthwhile to ask in whose interest the MRA negotiated. Reimbursing developers for what they agreed to do on their own dime does not strike me as sharp dealing. You can read all about it in this week’s column for the Missoula Independent. We’ll be back tomorrow with Friday links!

Commissioners sign petition, deny bias, postpone decision

By Dan Brooks in Montana Politics 0 Comment
In the years after World War I, the Missoula Mercantile building moved three tons of huckleberry fudge a day.

The Missoula Mercantile, which once moved three tons of huckleberry fudge per day.

Bad news for business travelers: Missoula’s Historic Preservation Commission has put off deciding whether to let developers knock down the Missoula Mercantile Building and build a Residence Inn. It met for four hours last week. In addition to public comment that compared HomeBase Montana to ISIS, the commission addressed the recommendation of City Attorney Jim Nugent, who advised four members to recuse themselves for bias.

“I am still in shock that somehow we’ve been found guilty without any due process whatsoever,” commission vice chair Steve Adler told The Missoulian. I find him guilty of exaggeration. Nugent issued no verdict, because he held no trial. He did tell four commissioners that the city could be vulnerable to a lawsuit if the they didn’t recuse. Nugent’s office discovered that Adler, an architect, worked on his own plan to develop residential condominiums in the Mercantile building. He also signed a Save the Merc petition and liked various postings from a group of the same name on Facebook. So did commission chair Mike Monsos and commissioners Kate Kolwicz and Cheryl Cote.

First of all, alliteration on the Historic Preservation Commission has gotten way out of hand. Second, and perhaps even more importantly: Did you guys think signing petitions and liking Facebook posts from parties to a permit dispute that you’re adjudicating was appropriate? I am scared the answer is yes. Now’s a good time to remember that Missoula’s commissioners of historic preservation are all volunteers, and we’ve asked them to stop putting plaques on mansions just long enough to intercede in multimillion-dollar development deal.

This may not be a job for amateur government, but it has fallen to the amateurs’ lot. We installed these people, and we will foot the bill if their predictable errors in judgment trigger a lawsuit. You can read all about it in this week’s column for the Missoula Independent. Official motto: Your local newspaper that has an editor.