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Home My WebLink AboutTax Relief (7) . \ APPLICATION i " New or l';xpanding Manufacturin!l; lndul\try Property Improvements or Mode.-nizcd Processes (TItle 15 ~ Chapter '14 - Part 14 MCA) TO: Arletta Derleth Assessor, Gallatin County NAME OF APPLICANT: ((~i(':'tltific ;Iaterials Corp. Ma J.ling Addr{>ss: :3 10 Ice-pond ;~oa'::!, P.O. Pox 786 I DZ'"'Il1aJ'l , M'fS9715 LEGAL DESCRIPTION OF AFFECTED PROPERTY: ['11; 1 (1; nq ;/14, /'1 rort-;on of 'l'rAror 11 of (',n,",In 11'){1 to LhC' (' -j ry of 1=t)7.prn;:l'l, ('.'11 1 ;:11-" i '1 eOl rhty . r'()nt~~nFl,.fJf~rc.()nrll nrnrlPrl-y r<(")n"I-;OJ; 11,,("1,,7; t-h; >;> DATE CONSTRUCTION PERMIT ISSUED: 1 A-~:r.:;-PI) (If no permit is requ1te<!.spoe!:Uy thedilt::e wl)en. cQnst::J;]JFtio~!be~a,!1) ~ ' -. . THIS APPLICATION COVERS T.HE (EXPANSION/NEW) CONSTRUCTION OF TIlE Icepond 0:;0<3.(": PLANT. NUMBER OF ANTICIPATED NEW JOBS ~'ICH WILL BE CREATED? 12 NUMBER OF EXISTING JOBS ~!ICH WILL BE ELIMINATED? 0 WHAT AFFECT WILL THE NEW, EXPANDING, OR MODERNIZED INDUSTRY HAVE ON OTHER BUSINESSES IN THE TAXING JURISDICTION? ! Cigq ]1oZ0Jn2n Payr-o] 1 - 1clO"L40R . BrojACt~d 1990 P21yrol1 ~?40,()OO I ')ii9 I'oz,man Purchas0~ ~('7 ,612 "})mjPci.pd 1 QQO j:),ozP.1TI,m Pllrchi',sps <!; 1 no, nnn WHAT ECONOMIC BENEFIT CAN BE EXPECTED WITHIN THE TAXING JURISDICTION FROM THE CREATTON OF THE NEW OR EXPANDING INDUSTRY? i'lant: dnd equi-,:rne.nt investment over three years - ,mprox. :7;1000000.00, PDyroll over' t.hrpp 'C;a:!~S - ,,1, 000,000.00. Local purchC1ses of CTocy,::Ls and sF'rvices over tllrec' ye:"es - '1;500.000. no. AN APPLICATION FOR "NEW INDUSTRY" CLASSIFICATION (WILL/~ID~ BE MADE TO THE DEPARTMENT OF REVENUE FOR THESE FACILITIES. (15-6-135(3), MCA) THE QUALIFYING PROPERTY CONSISTS OF THE FOLLOWING: Crystal qrr..J\-rtJl equi~ne..'1t inst;'111at.ion tbrouuh : 900 .::,yc(>r,din..,: 'V,OO,OOO, hut 1e"s than ~~l,OOO,OOO. THE MODEHNIZED PROCESSES CONSIST OF THE FOLLOWING: THIS APPLICATION IS MADE UNDER TIlE' PROVIsiONS OF 15-24-]402, MCA: AND BY RESOLUTION ADOPTED BY TIlE :ozernf'n ('j ty (yy.:nrnis s ion 29th June Taxing of ("0] ] fl1-t n COUNTY, ON THE ,DAY OF , 19(;7. A COPY OF Jurisdiction \ I SAME IS ATTACHED. ',,';'f', ~:\ l~ "~'~t~~~:.<, I (r'M l' '1'-'".., Subscf'jbedandi~'vr(;ln; to~fore me this day of i",c1rch , 1 <B ..Q... . .... \,,\.\, ',.' , t -'to '" ',: ~ .. r' r:4e \ t\ ~~A'- t->S-t(~__---L'-t -. (~~t\it~~ J:; (...' "",":' , ''''\,\'';1,)' ..' ':::'- i Notary Public or the .,> '" . ' " '.e - t: State of ~ :ont.ana " ...'':!/ h ~..., .......... residing at P-0ZRmaJl ,t'f'T '''''''~~''''''l't'''''':''''';.....r. My Commission Expires: (LQ..J.Lj\C1CtlJ WE~ :ruE UNDERSIGNED,- -clfv- Com.mi'ssion- - ~f- CIty -of -Bozmman - - - - - - (APPROVF~I.JAr~)-TIiIs APPLICATION Title Taxing Jurisdiction BY Scientific Materials Corp. . WE FIND THAT IT (DOES/OOmf''N!.YIj CONFORM TO THE CRITERIA AS SET FOR11l IN THE RESOLUTION ADOPTED BY THIS City COMmission ON THE 29th DAY OF ,Tune , 19>37. '-, .' ",;1" <I ) {,., . (/;"1- ' ~ ' ...;d';li i' .. Cler}: of the CDr1lmission ( I",t^- ." :-' / ,', e</lfr:............./ Name Title . Name Title " !O' Name Title Subscribed~:and 'sworn tolblrore me th is 14th - day J;lf Mav '/ /, 1~.:.2... ''1''''\ ,.) ~-,'?'" / ! " ~~[ ~~" I:~-----~ -~" b~)!~/-,-" 'f~':'{NO " . ;',' Au A(~ ., ". .'.: '~'~t: ,~,' 'F."". ,F' ~ Notary Pu lic for the ': '. '.It'V ''ltt. -. State of - ion tcJ..ai1 ",'" ~; ',p. ~'( residing at 'lozArqiln ,. ~"/ My Commission Expires: C)--l ;1'-",10 ." r.11 ' " j r f1r fA \ VI " \, NOTE: MAKE APPLICATION FOR EACH AFFECTED TAXING JURISDICTION AND ATTACH THEIR RESOLUTION. Assessor (Original); Clerk & Recorder (Pink); Tax Jurisdiction (Canary); Applicant (Gold) I . ill , \: ~ 'w J .,f _'\I" ~ 'tII ! . ,.' '-+ rJ 0" r i '0> "" APPLICATION.. ".,r New or E~panding Manufacturing lndust.ry Propect)' Improvement's ,or,.Mode,nized ProcesSeS (Title 15 - Chapter '14 - Part 14 MCA) TO:' i'\rletb3. nerleth Assessor, Gallatin County NAME o.F APPLICANT: '( ~ipr~tir i.c ,<i1tE'rii1.1s Carr). MaIling Address: }; 0 Icc~DOnd~oad, P.O. t~x 786 :;()z,'mn~\, i1'l' r;Q71S LEGAL DESCRIPTION OF AFFECTED PROPERTY: ["ni 1 di Mn :ij:Il., " fOrti OM nf ']"r-<'lr-t. 71. of (' n, '; , '" l'PQ to t:!P "1rv,,'}f1b7.("l'V1P, C:111AHn ('rnl'ht")l~ :vinnt"J'lr'li\,. p0~on;\ll n~rt-y r<f1rlh~;n(..r1 ~,dtl)ip. DATE CONSTRUCTION PERMIT ISSUED: 1 ~_ ?t;_W,! (If no permit is requir,ed.~p~!:ify ,the dat~ ,when C09!'1,t,I:l;!~t;l'f?~ b,~g~"n,.) " "",' , ,\, ," ,q," "H THIS APPLICATION COVERS THE (EXPANSION/NEW) CONSTRUCno.N OF TIlE Icepond Roar) PLANT, NUMBER OF ANTICIPATED NEW JOBS ~IICH WILL BE CREATED? 12 NUMBER OF EXISTING JOBS WHICH WILL BE ELIMINATED? 0 WHAT AFFECT WILL THE NEW, EXPANDING, OR MODERNIZED INDUSTRY HAVE ON OTHER BUSINESSES IN THE TAXING JURISDICTION? i'.l/ifl Pozernan P,':lyroll .. !l;lOl,40R projected lC)qn Pi'lyroll ~~240,OOn ]f)flq '~OZC'll1an Pur('.na.!-1AQ $(,7, (;12 Projecb:rl 1 qqO F\O?:P.Il'l11n Pl.lrr.h,:~!,:p!~ !t 1 nn, nnn WHAT ECONOMIC BENEFIT CAN BE EXPECTED WITHIN THE TAXING JURISDICTION FRo.M THE CREATION OF TIlE NEW OR EXPANDING INDUSTRY? i'lani.: ilnd equipTlE-'nt investment over three years .. awrox. ~l00900().OO, PiWyoll m7'(>Y:" thrE'lO' \'r'al:G - ':'1,000,000.00, local purchases of QQ(X1S and s8rvicefl ovc~r three ye.;,-E!S -1500,000.00. AN APPLICATION FOR "NEW INDUSTRY" CLASSIFICATION (WILL/~ BE MADE TO THE DEPARTMENT OF REVENUE FOR THESE FACILITIES. (15-6-135(3), MCA) THE QUALU'YING PROPERTY CONSISTS OF THE FOLLOWING: Crystal cru;,rt:h equip&-tent instr.>llnti.on tl.rouah :; 990 e:ce€!'.Jinc; $~;OO,OOO, hut le~;s than $'.1,000,000. TilE MODEHNJZED PROCESSES CONSIST OF THE FOLLOWING: THIS APPLICATION is MAht UNDER THE (PROVISioNS OF 15-24-t402;' MeA: AND :BY RESOLlITIClN ADOPTED "liy' TIlE "'l"oz'c.mc.r: ('if?! Taxing /"(,~1f'iiHSion of C:allAt.:ln COUNTY, ON THE 29th DAY OF ~Tune , 19 ''\7. A COPY OF Jurisdiction SAME IS ATTACHED. i i " ( I h'_:' i~ t, ,\,......, : ;;.' i' .. ;~I' 1 r...:.I,: :., I' ' , . \. ' 'IIJ ,\.,..-~....-". i"'."'. ...' . ....,~ , Own /A \ , iU"-'Q I "'.' et;' gent ; '\ ~~ . ~y~ r'-~;~ SUbS~.. ,';~ed,@'9. ..lj'U:k~~'. t... 0 l~.fore me this / ({M day of J'io.rc}l , 1990 . ~~i ,,~~~~~\l.'~~. \ ,.\Ji \. i.. - ,",";:' . <<I .~" . [/'., I~\ .: 1:tJ~~~~~. t ',,"k' \ \. \ \ \.,~,-,""..-t": I' ,~.. , ~.~" rj Notary Public or the ;~lJt'" .' l , " . l'O< I St t f vont"'....' \ '...~:li" 1" a eo, ,( ...(A;f.,~r..l '., ,,'.' ~..~ ,/ residing at PO:!:f'!l'1ar1, :~' "~~, . ,. :j!.' , ,.' /" C . "'\ ..'..'h.....""......' My Commiss Ion Expires: ''''1..'':'' (, 1\ i Il,j WE: TuE UNDERSIGNED,- -c1.fy-commission - ~f-1:!ty-01:BoZ_an- - - - - - (APPRoVEmm'!'~m-TIIIS APPLICATION Title Taxing Jurisdiction BY Scientific !1aterials Corp. WE FIND THAT IT (DOES/'OO'ES"l'fij'M CONFORM TO TIlE CRITERIA AS SET FORl1l IN THE RESOLUTION ADOPTED BY THIS City commission ON THE 29thDAY OF June , 1987. ',.~' (," }:.':,~, " COil 'h'f"t'h'-' C" . i" ..' \ 'f'" \, ""I': ''',_--, erT" 0 e ~omm SSl.On Name Title 'i ~ Name ,Title ,,\\\~'. ~ r'., Name Title SUbscri~~<..;Wtdsworn t6n~.~e me this 14th day ~f M~~ I .:~ ' lcfl~. ':." :hi~1dl~~.L~A.. ~." \. j.. - ;} /2 .,.. E ..: 'c.:~ ,'\~ ~ ,.,. \ ,. '" ,. '--- - v/~.- -.... ) :~. O. ...... "~".." .~. Notary Pu. bl1c. fo; the "1 . I\'" ;t 'J' ,f jj ,. ~ .;\ " ....,.. ....1.l-31l'-.. ,: ~; State of t!ontana ",I~' : ~t. " ,. , ,'it..""'" residing at BOZeMan "'',,'' ,.'r -. .~!-,.~-., >" - My Commission Expires: 9--14 -gO .fl.'", ," ,.. r ~ ',.' < :...,;,,~ NOTE: MAKE APPLICATION FOR EACH AFFECTED TAXING JURISDICTION AND ATtACH THEIR RESOLUTION. Assessor (Original); Clerk & Recorder (Pink); Tax Jurisdiction (Canary); Applicant (Gold) .., All Business Activitie) , Scientific Materials BI-"5"~Cli.nt' ."" 01/29/90 07:57 alii l oc. 1 1 - 999 Gr. 1 1 - 999 Tax Depreciation Summary Period 12/31/89 - '"12/31190 Page 1 dPt.1.4h Cl life ~~o~~r~~sDtscri~~ion Acquired Cost Exp/AfD Prior Dep. Cur Dep. nd. Dep. Met Book V. Group 1 1 - leasehold Improve. 1220 1 1 General improvements 7/01/89 9,000 0 131 286 417 8,583 R M 31. 5 2 1 Improvements 8/01/89 12,899 0 154 409 563 12,336 R M 31. 5 3 1 Electrical hookups 8/01/89 20,404 0 1,457 5,413 6,870 13,534 N M 7.0 10.0 Group Totals 42.303 Dc 1.742 6.108 1.850 34,453 Group 1 2 - Manufacturing Eq. 1230 1 1 Equipment setup 8/01/89 11.361 0 812 3,016 3,828 1,539 N M 7.0 10.0 2 1 9 laser Grovth Machines 8/01/89 405,000 0 40,500 145,800 186,300 218,700 U M 5.0 6.0 3 1 Irridium crucibles 3/10/89 45,000 0 0 0 0 45,000 N .. 0.00 0 4 1 Misc. manufacturing eq. 7/01/89 34.000 0 3,400 12,240 15,640 18,360 U M 5.0 6.0 5 1 Hoist 1101/89 300 0 21 80 101 199 N M 7.0 10.0 6 1 Water equipment 8/15/89 3,090 0 309 1,112 1.421 1,669 " M 5.0 6.0 7 1 Drill press 12/01/89 195 0 14 52 66 129 N M 7.0 10.0 8 1 Welder 12/01/89 800 0 57 212 269 531 " M 7,0 10,0 Group Totals 499.752 Oc 45,113 162.512 201.625 292,127 Group 1 3 - Office Equipment '240 1 1 Office furniture 1101/89 2,000 0 143 531 674 1,326 " M 1.0 10.0 2 1 furniture 7/01/89 1,571 0 112 417 529 1,042 " " 7.0 10.0 3 1 Computer 10/23/89 4,424 0 442 1.593 2,035 2,389 M M 5.0 5.0 Group Totals 1.995 Oc 691 2.541 3,238 4.751 Group 1 4 - Organizational Cost '290 1 1 Organizational Costs 6/01189 51.588 0 5.159 10,318 15,477 36,111 N AM 5.00 0 Group Totals 51,588 Dc 5.159 10.318 15,477 36 .111 Grand Totals 601.638 Oc 52,711 181.479 234.190 367,448 c - Current Year Section 119 ; SCIENTIFIC MATERIALS CORP. . 310 ICEPOND RD PO BOX 786 BOZEMAN MT 59715 406 585 3772 March 16, 1990 City Commissioners City of Bozeman P.O. Box 640 Bozeman, MT 59715 ATTN: Mr. James Wysocki, City Manager RE: New or Expanding Manufacturing Industry Property Improvements or Modernized Processes Attached is our application for a new industry property tax reduction under Section 15-24-14 M.C.A. We are applying for this credit to cover the investment in leasehold improvements, machines and equipment at our leased facility at 310 Icepond Road, Building #4. The attached depreciation schedule covers our 1989 investment of $550,050. We expect to add an additional $200,000 to this investment in 1990, bringing the total investment included in this request to $ 7 50,000. The add it i ona 1 1990 investment i nc 1 udes additional crystal growth equipment and facilities to grind and polish crystals. At the present time, our facility employs eight people, seven of which are college graduates. We expect employment at this facility will top out at fifteen people in 1991. We expect that ten people will be college graduates. As to impact on the community, in 1989 Scientific Materials Corporat i on spent $171,040 in Bozeman, and $184,379 in Montana. The payroll only in 1989 was $103,408. These amounts are based on eight months activity. We expect these figures to double in 1990. If the business grows as currently projected, Sci-Mat's payroll in Bozeman should approach $700,000 by 1992. Purchases of supplies and services in the local area is expected to exceed $300,000 by 1992. This type of tax reduction is essential for a capital intensive business, such as Scientific Materials Corporation, to operate in Montana. It was my initial understanding, per the Department of Commerce, that this tax reduction was automatic. Like most things, it is never that easy, and hence the reason for this application and the request for favorable action on your part. \ I am attaching statements from members of the local community as to their opinions of Scientific Materials Corporation and as to their dealings with the company. The orgnaizations included are listed below: Gallatin Valley Development Corporation Big Sky Laser Corporation Montana State University Service Electric Corporation Culligan Water Service Bird Creek Realty T. J. Jacobsen, CPA Thank you for your every consideration. Yours truly, ~ Jr/1Jj~ RALP L. HUTCHESON jg Enclosures . .' GALLATIN DEVELOPMENT CORPORATION 321 E. MAIN, SUITE 413 BOZEMAN, MONTANA 59715 (406) 587-3113 March 16, 1990 Mayor Bob Hawks and the City Commissioners City of Bozeman 411 E, Main Bozeman, MT 59715 Dear Mayor Hawks and Commissioners: Gallatin Development Corporation is pleased to support the application of Scientific Materials Corporation for property tax reduction under the provisions of Resolution No. 2660, As you know, early in 1989 Scientific Materials Corporation chose Bozeman as the site for its new facility. Gallatin Development has continued to follow the progress of this project. It ~s a positive addition to the core of "hi-tech" laser businesses in this area. ,siire1Y, /~~~ V/ ," ,/ 't-u2~ Di ie F. Swenson Executive Director DFS/sbt ':3Ie rwo@ ~fJ[W fLIiJ~~fX1 ([;@fX1fP@mJIfJIfO@!M ~, P.O. BOX 364!5, BOZEMAN, MT !59772-3645 (406) !586-Q131 March 16, 1990 Bozeman City Commissioners City of Bozeman P. O. Box 640 Bozeman, MT 59715 SUBJECT: PROPERTY TAX REDOCTION FOR HIGH TECH BOSINESS I support Ralph Hutcheson's Scientific Materials Corporation application for property tax reduction pursuant to Section 15-24-14 of MCA. His company, and others like it, have a difficult and challenging course to follow, technically, managerially and most of all, financially, to bring together the resources to met their business objectives. Incentives to small businesses, particularly high tech companies, would be most welcome not just to SMC but to other companies already here or considering Bozeman as a potential site. Helping these businesses helps Bozeman and the community in that it provides more resources for growth, helps in the economic growth in the area and generally will promote the well-being and outlook for small businesses overall. Consequently I ask your serious consideration of the property tax reduction for Scientific Materials Corporation. BIG SKY LASER CORPORATION hfT12ptr Ed Teppo, President EAT:pc ~n Montana State University ~ Bozeman, Montana 59717-0001 Vice President for Administration (406) 994-4361 March 16, 1990 Bozeman city commissioners city of Bozeman P.O. Box 640 Bozeman, MT 59715 Dear Commissioners: I am writing in support of Scientific Materials Corporation's (SMC) application for property tax reduction pursuant to Section 15-24- 14 M.C.A. Since its founding in 1989, SMC has received enthusiastic support from the pUblic and private sectors for their research and development activities as well as their manufacturing operations. Currently, they have recei ved support from MSU (cooperative research programs in Physics and Chemistry), Montana Science and Technology Alliance (financial assistance), National Aeronautics and Space Administration (research grant) and several private clients (laser product sales). steady economic growth is the key to the future of our community and state. Bozeman has unique environmental qualities that are appealing to laser and laser related businesses. We have a attractive climate; a highly reliable power supply; a major research university, with its faculty expertise and facilities; and an excellent quality of life. During the past two years, Bozeman has earned a reputation as a excellent location for laser product companies in the west. I would encourage the city to build on our competitive advantages in the laser industry. Providing tax incentives to SMC will not only solidify the company existence, but also send positive signals to the laser industry that Bozeman wants to build on our competitive strengths. Moreover, the City has an opportunity to encourage economic development. During the next few years, SMC will create several high paying professional jobs. For MSU students in scientific and engineering fields there are limited opportunities to remain in Montana and in our fine city. SMC' s growth will assist in our efforts to retain some of Montana's best and brightest students in the state. We applaud their efforts to hire Montanans and MSU graduates. In summary, MSU is very supportive of SMC. We see the potential for increased joint research projects as well as increased economic development opportunities for our community. ..... Sincer~ + James L. 1sch Vice President for Administration Service Elec"lric BOX 1198 . 39 N. ROUSE . BOZEMAN, MONTANA 59715 . 408-567-5518 March 14, 1990 To wtan it may Concern, This will infonn you that we have for a period of approximately one year done electrical installations and maintenance work for Scientific Materials, looated at 310 Ice Pond Road in Bozeman, r-Dntana. We have found conditions there to be exceptionally clean and organized and operations are conducteEl in a safe and efficient maoor. Yours tru1 y, . ~<;I '~.<~.:7 -<-.'1 /<'- ..-. -'/'1 .........' ,,",' Melvin A. Butts CULLIGAN WATER CONDITIONING 414 BRYANT ST. BOZEMAN, MONTANA 59715 PHONE 586-2453 March 1 4, 1990 To whom it may concern: We here at Culligan have been doing business with Scientific Materials of Bozeman for the past year. The owner, Ralph Hutcheson, is a very knowledgeable person and we certainly enjoy doing business with him. His operation, of which I would like to see a lot more of in our area, is very high technology. The manufacturing of laser crystall is certainly a business of now and the future. A business such as this is a definate plus to our community. After going thru the entire facility, I was very impressed with the cleanliness and the well maintained equipment. I would not hesitate recommending their company to anyone. Sincerely, ~ f:::;t:er . OWner LH/ldr RESIDENTIAL, COMMERCIAL, INDUSTRIAL WATER CONDITIONING PRODUCTS AND SERVICES . Ma r~ch 14, 1990 City Commissioners City of Bozeman P_O. Box 640 Bozeman, MT 59715 RE: Scientific Materials Corporation ATTN: James Wysocki, City Manager We have dealt with Scientific Materials Corporation now for well over a year from the planning stages of Mr. Hutcheson bringin~J Sci.Mat to Bozeman on through our leasing him the present site at 310 rcepond Road, Building #4. As a tenant of my property, Scientific Materials has been ver'y cooperative and diligent in their leasing arrangements. The relationship between Scientific Materials and Bird Creek Realty has been mutually beneficial. We look forward to the continuing growth and expansion of this company, and thus hope to be able to assist them as they grow. The opportunities are great for the Bozeman area with this promising new company. Sincerely, ~\ Hugh & Charlotte Reid Bird Creek Realty . T.J. JACOBSEN CNtified Public Accountant 222 F, MAIN, SUITE 303 PO_ BOX ?19 BOZEMAN, MONTANA 597710:'79 ~-- 406-5860281 March 14, 1990 City Commissioners City of Bozeman PO Box 640 Bozeman, MT 59715 RE: Scientific Materials Corporation ATTN: James Wysocki, city Manager I have worked with Scientific Materials corporation as their outside financial consultant since May of 1989. I have found Scientific Materials corporation and specifically, Ralph Hutcheson, to be very professional in their operation. Scientific Materials is the type of business that Bozeman has historically sought. In Resolution 2660 the Bozeman City Commission stated they wanted to "promote industrial improvements and processes that are clean and that maintain and enhance the community;s natural environment and other amenities while broadening the economic opportunities available in the area". Scientific Materials definitely meets those criteria. I feel it is imperative that the city of Bozeman does whatever is reasonably possible to promote this type of business. Sincerely, 4~ ,'" '/r'l (.' ",'-~:- - . / b Tlm Jaco sen 214 215 SPECIAL PROPERTY TAX APPLICATIONS 15-24-1401 dited against the tax so Cross- References y the federal government Centrally administered tax "exempt property, xes. 15-23-11l. Part 13 Montana Economic Land Development Act . nd coUection - no (Repealed. Sec. 1, Ch. 48, L. 1985) Part Compiler's Comments 15-24-1309. En. 84-7511.1 by Sec. 8. Ch. such possessors or users Histories of Repealed Sections: 582, L. 1977; RC.M. 1947, 84-7511.l. '" shall be collected and 15-24-1301. En. 84-7501 by Sec. 1. Ch. 15-24-1310. En. 84-7512.1 by Sec. 9, Ch. er as taxes assessed to 549, L. 1975; RC.M. 1947,84-7501- 582, L. 1977; R.C.M. 1947,84'7512.1- which is subject to ad 15-24-1302. En. 84-7502.1 by Sec. 1, Ch. 15-24-131l. En. 84-7513.1 by Sec. 10, Ch. 582, L. 1977; RC.M. 1947,84-7502.1- 582, L. 1977; RC.M. 1947,84-7513.1; amd. Sec. ome a lien against the 15-24-1303. En. 84-7503.1 by Sec. 2, Ch. 25, Ch. 693, L. 1979. attached, encumbered 582, L. 1977; RC.M. 1947,84-7503.1- 15-24-1312. En. 84-7514.1 by Sec. 11, Ch. . , 15-24-1304. En. 84-7504.1 by Sec. 3, Ch. 582, L. 1977; RC.M. 1947,84-7514.1- Imposed hereunder. 582, L. 1977; RC.M. 1947,84-7504.1; amd. Sec. 15-24-1313. En. 84-7516.1 by Sec. 13, Ch. 582, L. 1977; R.C.M. 1947,84-7516.1- 6, Ch. 274, L. 1981- 15-24-1314. En. 84-7517.1 by Sec. 14. Ch. ilege tax. A tax due 15-24-1305. En. 84-7505.1 by Sec. 4, Ch. 582, L. 1977; RC.M. 1947.84-7517.1- 582, L. 1977; R.C.M. 1947,84-7505.1- 15-24-1315. En. 84-7518.1 by Sec. 15, Ch. , constitute a debt due 15-24-1306. En. 84-7508.1 by Sec. 5, Ch. 582, L. 1977; RC.M. 1947,84-7518.1- .; concerned in the tax. 582, L. 1977; RC.M. 1947,84-7508.1- 15-24-1316. En. 84-7519.1 by Sec. 16, Ch. ,Jr any portion thereof 15-24-1307. En. 84-7509.1 by Sec. 6, Ch. 582, L. 1977; RC.M. 1947,84-7519.1- 582, L. 1977; RC.M. 1947,84-7509.1- 15-24-1317. En. 84-7515.1 by Sec. 12, Ch. ?e county auditor may 15-24-1308. En. 84-7510.1 by Sec. 7, Ch. 582, L. 1977; RC.M. 1947.84-7515.1- ne clerk of the district 582, L. 1977; RC.M. 1947,84-7510.1; amd. Sec. 15-24-1318. En. 84-7520.1 by Sec. 17. Ch. nter in the judgment 24, Ch. 693, L. 1979. 582, L. 1977; R.C.M. 1947,84-7520.1- of the delinquent tax- columns, the amount Part 14 warrant is issued and warrant so docketed New Industry - Real Property Improvements red by a district court county shall have the 15-24-1401. Definitions. The following definitions apply to 15-24-1402 dgment docket. unless the context requires otherwise: (1) "Expansion" means that the industry has added after July 1, 1987, at least $250,000 worth of qualifying improvements or modernized processes to s. (1) Each private its property within the same jurisdiction either in the first tax year in which mpt property subject the benefits provided for in 15-24-1402 are to be received or in the preceding 1 each year, file with tax year. n or other beneficial (2) "Industry" includes but is not limited to a firm that engages in the: year and the value (a) mechanical or chemical transformation of materials or substances into the department and products in the manner defined as manufacturing in the 1972 Standard the case of an asso- Industrial Classification Manual prepared by the United States office of man- or corporation. The agement and budget; (b) extraction or harvesting of minerals, ore, or forestry products; or . corporation; (c) processing of Montana raw materials such as minerals, ore, agricultural products, and forestry products. mpt property. (3) "New" means that the industry is new to the jurisdiction approving necessary to insure the resolution provided for in 15-24-1402(3) and has invested after July 1, , property complies 1987, at least $500,000 worth of qualifying improvements or modernized pro- cesses in the jurisdiction either in the first tax year in which the benefits pro- vided for in 15-24-1402 are to be received or in the preceding tax year. New 15-24-1402 TAXATION 216 217 I <' industry does not include property treated as new industrial property under Subject to the authl 15-6-135. tion, or expansion I (4) "Qualifying" means meeting all the terms, conditions, and require- taxable value by at ments for a reduction in taxable value under 15-24-1401 and 15-24-1402. or its agents, may rl History: En. Sec. 2, Cb. 564, L. 1981; amd. Sec. 1, Cb. 574, L. 1987. the following 5 year 15~24~1402. New or expanding industry - assessment. (1) In the following schedule. ' first 5 years after a construction permit is issued, qualifying improvements or tions (3) and (4) an modernized processes that represent new industry or expansion of an existing remodeling, reconstr industry, as designated in the approving resolution, shall be taxed at 50% of Construction pel their taxable value. Each year thereafter, the percentage shall be increased by First year follow equal percentages until the full taxable value is attained in the 10th year. In Second year folll subsequent years, the property shall be taxed at 100% of its taxable value. Third year follov (2) (a) In order for a taxpayer to receive the tax benefits described in sub- Fourth year folIc section (1), the governing body of the affected county or the incorporated city Fifth year follow or town must have approved by separate resolution for each project, following Following years due notice as defined in 76-15-103 and a public hearing, the use of the sched- ule provided for in subsection (1) for its respective jurisdiction. The governing (2) In order to CI body may not grant approval for the project until all of the applicant's taxes erning body of the a have been paid in full. Taxes paid under protest do not preclude approval. incorporated city 01 (b) The governing body may end the tax benefits by majority vote at any town must approve time, but the tax benefits may not be denied an industrial facility that previ- expansion project th ously qualified for the benefits. schedule adopted pu (c) The resolution provided for in subsection (2)(a) shall include a deflni- (3) The tax bene tion of the improvements or modernized processes that qualify for the tax of mills levied and a treatment that is to be allowed in the taxing jurisdiction. The resolution may trict purposes and 1< provide that real property other than land, personal property, improvements, erning body approvi or any combination thereof is eligible for the tax benefits described in subsec- subsection (1) apply tion (1). (4) A local gover (3) The taxpayer must apply to the county assessor on a form provided modify the percental by the department of revenue for the tax treatment allowed under subsection following constructic (1). The application by the taxpayer must first be approved by the governing body of the appropriate local taxing jurisdiction, and the governing body must government may n01 indicate in its approval that the property of the applicant qualifies for the tax apply to the fifth ye. treatment provided for in this section. Upon receipt of the form with the A local government approval of the governing body of the affected taxing jurisdiction, the assessor (1). The modificatioJ shall make the assessment change pursuant to this section. government apply UJ (4) The tax benefit described in subsection (1) applies only to the number project approved by of mills levied and assessed for local high school district and elementary History: En. Sec. 2, ( school district purposes and to the number of mills levied and assessed by the L. 1989. governing body approving the benefit over which the governing body has sole Compiler's Comments ~ 1989 Amendment: Ir discretion. In no case may the benefit described in subsection (1) apply to inserted "Subject to the t levies or assessments required under Title 15, chapter 10, 20-9-331, 20-9-333, subsection (4)" and in tW( or otherwise required under state law. ence to subsection (4); if) . History: En. Sec. 3, Cb. 564, L. 1981; amd. Sec. 2, Cb. 574, L. 1987. Part 15 Remodeling of Buildings or Structures 15~24~1501. Remodeling, reconstruction, or expansion ot build~ 15~24~1601. p, tngs or structures - assessment provisions - levy limitations. (1) and guidance for thE . . May 7, 1990 STATEMENT RE: TAX INCENTIVE FOR SCIENTIFIC MATERIALS: The original resolutions for the tax incentives by the city and county 'Were initiated by the Gallatin Development Corp. and the Chamber a few years ago. OUr groups felt Bozeman and Gallatin County needed to offer this incentive to potential new and existing businesses for economic development The law had been introduced by the state legislature earlier. We often been accused of .offering the world. to new business and not offering the same to existing business. Research has proven that most new jobs are generated from existing business expansion. However, often existing business does not want to appear that they are asking for special treatment, wben in reality, the incentives are designed for the use of both new and expanding business. The paperwork. involved, the revealing of financial information, the adherance to government regulations, is often a disincentive to a business applying for want Is meant to be a support for their conUllued success and future expansions. We support this application as W'ewould other appropriate business applications. This law is in place for a good purpose and we need to encourage others to take advantage of it sa -Mat has invested in their plant and equipment and will add more employees in the future. Supporting this request enables them to bulld up to full payment of increased property taxes after the abatement period, thus adding to the city's tax base. Hopefully, we <:an see additional expansion during this period, also adding to the city's future capabilities of adding to the tax base. When we employ people, they spend money and make purchases, also adding to the economic health of Bozeman. Thank you for your consideration of this request Por the Board of DIrectors, Area Chamber of Commerce J. Joyner, iVP ICF.O 1205 E. Main St. . P.O. Box B . Bozeman, Mt. 59715 (406) 586-5421 A Non-Profit Membership Organization, Working for a Better Bozeman ... ~ .. t ANALYSTS ALL GIVE MONTANA LOW MARKS ON ITS BUSINESS . CLIMATE Confusing Maze Of Bow State so WHAT'S THE PROBLEM? Assesses C1alsses Of Property The problem with the tax system in Montana that produces a Goes To Heart Of Tax Problem bad business climate is not necessarily the level of taxation, but the distribution of the tax burden. We rank second in the nation Each year a number of business orpni7.Ations rate the states in the percentage of tax revenue derived from the propetty tax. in tenns of business climate. Each organization uses different Moreover. we derive 48 percent of our total slate and local tax criteria to establish their rankings and in every one, Montana is collections from the property tax compared to the national near the bouom of the list as a place to do business or establish average of 30 percent Funhennore. Montana does not tax a now business. property in i ullifonn method. . INe magazine rates Montana's business climate 48th out of The proV::ll'l :ax on land and buildings in the state is moder- SQ:. OI'ant Thorton's Economic Development Repon rates Mon- ate - slightly aba...e the national average. The propeny tax on taria's business climate as 20th out of 21 western states; the business machinery and equipment is among the IUghest, if not Federal Advisory Commission on Intergove.tnD1ental Relations tbe highest in the United States. This is a function of the propeny ~Monta."1a's b!lSi~es~ climate as 43rd c'n ~f 50. 'The ta."':'CIMSific~on ~)'::tz:n. Land and buildings in Montana arc OipOration for Enterprise Development, however, rates Mon- taxed on the basis of 3.86 percent of madel value; business "./~as having the best educated and most productive work force machinery is taxed (beginning in 1990) on the basis of9 percent · '{ri the nation. . ol..-tet value; the paOpdty of railroads and public utilities are " - . Why does the state with the best educared and mOlt produc.. - at 12 percent of market value; the gross proceeds of coal live work force in the nation rant 40th in per capita iDcomo lIJines OD the basis of 45 percent of market value; and the net ($1,623 per capita below the nadonal average)? The answer Is proceeds of oil and gas wells on the basis of 100 percent of market '~climate, and a major cause of a poet business cliliwe is value. i.,"" tax system. The PederaI Adviaory CommJsaioa onImer. 11IR CRUX OF TIlE PROBJ .F.M ,;.~t.Il Relations, which gave Monrana the best busiacas This confusing system of taxilll different property at different c1ilpa&e rating, at 43rd out of SO, ranks this Stale's laX sy.tem at ~ve1J is the CJ'Wt of the tax problem in Montana. The result is &hat 46th out of SO and its tax balance at 47th out of SO. the owner of .S 100,000 residence in this state, taxed at 400 mills, ;., ~t it!'Ot that taxes are partiCularly high in Montana. IDdeed, wWpay SI,544 in ptopg.tt tax. At the same tax rate, business in 1988 Monrana was 29th out of the SO states in per capita tax machinery worth $100,000 will be taxed $3,600, public utility or co1lectionsforswcandlocalgovemmenlS. Total taxcoUections railroad property worth the same amount will pay $4.soo, coal f'?t-~ and 10caI governments were $215 percapira below the production, $18,000, and oil or gas production, $40,??oo in national average. However, because of the low income level property taxes. Montana's property taxes are not only high, they (40th in the nation) Monrana ranked 11th out of SO in tax are biased against the type of properties that provide jobs and collections per S 1,000 of personal income, about eight percent economic development The reason Montana's property tax above the national average. In 1988 Montana ranked 25th in the .ystem results in low ratings for the state's business climate is that nation in income tax collections per capita and 20th in income Montana treats business property poorly. tax collections per $1,000 oC personal income. Montana has no Business climate or tax climate ratings are relative. Mon- general sales tax, of course, and therefore relies heavily on tana'. rating depends on the Slate's tax system relative to the tax property taxes to pay for government services. The state is 12th syaems of all other states. The tax treaunent of businesses that in the nation in property tax collections per capita, $132 per operate here and in other states provide examples of the bias penon above the national average, and fifth in the nation in apinst business fOWld in the Montana propeny taX system. propeny laX collections per $1,000 of personal income. In HERE ARE SOME EXAMPLQS summary, income taxes are about average in Montana on a per 1. The Western Sugar Company Operates in the states of Colo- capita basis although a little above average per $1.000 of rado, Nebraska, Wyoming and Momana. A piece of equipment personal income. Property taxes are quitr high bUI, an off setting with a purchase price of $1.'50,000 ill 19:j5 was assessed the consideratiun is that Montana doesn't impose 8 gtnemJ retail following taxes in each state in 19R8: lalOI tax. (conttnued on page three) .. '., ANALYSTS ALL GIVE MONTANA LOW MARKS ON ITS BUSINESS CLIMATE ..ontinuedfrom page one) Scolts Bluff, Ncbr'dslca $36!R U.S. W t;:st Com munications provides teleo>mmunication serv- Fon Morgan, Colorado $3.887 ices to fowteen Stale8. Each state has a different set of taxes &hat Lovell, Wyoming $ 1 ,279 apply to telecommunications. In Montana. 72 percent of the Billings. Montana $9.366 taxes paid by U.S. West are property taxes. The following table 2.General Mills operates seven nour mills in the United lists total taxes per telephone line in each of the fourteen states. States. The mill in Great Falls produces eight percent of the daily II includes sales !.aXes paid by the company as well as sales taxeS production of flour from these seven plants and pays 25 percent paid by the consumer and income taxes and other assessments of the total property tax of the seven plants. Expressing the imposed on the company. property lax as it applies to each 100 pounds of flour milled SlaI& Total Tax..JS[ Rank produces the following results: rhone Li.ns< Mill Location IIopenv Tax ocr Idaho $31.20 14 100 wel\:hl vf fhij,lf North Dakota $36.12 13 Johnson City, Tennessee $4.61 Wyoming $42.12 12 Vallejo, California $4.65 Iowa $50.40 II Kansas City, Missouri $5.42 New Mexico $63.60 10 . Los Angeles, California $12.0H South DakoLa $64.56 9 Avon, Iowa $14.00 Colorado $66.72 8 Buffalo, New York $19.31 Nebr.:lska $70.80 7 Great Falls, Montana $4 3.36 Minnesota $72.72 6 Oregon $73.80 5 3. The Stone Container Corporation operates elevtn paper Arizona $76.68 4 mills in the United States. The estimated property tax payments Washington $77 .52 3 for the five highest taxed mills are listed below. Utah $78.12 2 Mill Location Real Estate Personal Property .ImAl Montana $86.40 1 :ill :ill Hodge, LA $160.000 $1 ,05(),roJ $1,210.<XXl Total taxes are higher in Montana than in any other state in the Hopewell. V A $330,000 $310.0::0 $1.!<<lro1 U.S. West servlce area as are property taxes. The basic phone Florence, SC $220,500 $1,25&,:.W $1,478Jl)) service charge of $15.71 per month must be paid for five months Snowflake. AZ $400.000 $1.110,00) $1.510.LX0 to equal the state and local taxes collected by U.S. West 011 a Missoula. MT $400.000 $3,950JXJ) $4.3~Jxn residential phone line. 1bese are aU examples of a property tax system that is out of The tax payments in this chart are estimates fOf tax ye.a.r 1990 balance and no longer competitive with other states. All compa. and include the reduction in personal property Ulxes enacted by nies that operate in morc than one state must divide limited the Montana Legislature in thc 1989 special ~cssion. The mill money for investment between the states in which they operate. doses I in size and prodUl.:tion capacity to lhc mill in MI~SOUla is Invcsum~nt brings employment and a tax base. As the tax system in Hodge, Louisiana. in Montana has become more and more punitive towards invest- 4. Burlington Northern, Inc. provides rail transportation servo ment. the economy has become increasingly stagnant Montana ices in 2) states. However, the following chart is limitc,d lO has lost population and it has lost tax base during the last decade. property taxes paid per mile of track ill the Rocky '\1ounlain Tax effort rises in Montana as personal income declines relative region. The figures are for tax year 1989. to the rest of the nation. S tate and local tax collections pet $1.000 ~ Property Tax ocr fullik of personal income in Montana increased from 22nd in the nation mile of R.R. trrlck in 1987 to 12lh in the nation in 1988. Yet state and local expen. , North DakoLa $ 783 7 ditures per capita declined from 12th in 1987 to 24th in 1988. South Dakota $1.277 (i Taxes are not generally believed to be a major delCl111inantof Idaho $1,286 ;;, business location, but they can be if they are severely out ofline New Mexico $1,60 1 -+ with surrounding states. Because Montana lags in economic Wyoming $1.704 \ dcvelopmem, her citizens must pay more in taxes and IR Colorado $1,899 2- receiving less in services than states with higher incomes. The Montana $3,849 1 state's business climate and tax system discourages the establish- North Dakota does not tax business machinery and equip- ment and growth ofbu:>ioesses and industries that provide higher mcnl. generally rderrt'd to as personal PrtTA:.rlY" T[Ii.; ~lI:)~x:rty .;~ ~h~n "vcng,~ ;;l':omes Rad a broader pro})(.~rty tax base. MootlOa l;xcmpt for all businesses in North Dakota in::lu61l.S.: iliti(',", 2:::0 "'lit H()( ~,:i'\''''1; e::r,ncmICally competitive wilh other states railroads. resulting in the lowest taXes fA;r mil" of L(.~" '"' ~~'l~ ';'.':'~~,.' J.h.lL iq\;1 ;,f':'p('rl~' iaxcs ThlS ';,11' vdy k-. done a.~ it is region. The Montan.. tax. more than daub;'; \,;'-,:>t :,,\1 lioc ne]t C'J:'" in ';taYl',y w.f;, !,.ctkr hl,,~ines~; ,me; taJ climates: wilh a highest competitor, is under appeal in federal COwl ar,d is tk ' .. fro . and l~;cl..":;'T'>i:..'. Ild,," ,',f rn';;.r, de ,n i.axc~: ')0 prope:1y. mr.ome. subject of negotiations N:lween the railmad aMi "^,,: L1or,I,"'":1 r.~l;',;,), .~.\(.::,_ Department of Revenue. ~" . . . . . . . THE CITY OF BOZEMAN 411 E. MAIN ST. P.O. BOX 640 PHONE (406) 586.3321 BOZEMAN. MONTANA 59715-0640 May 10, 1990 TO: City Commission T 'I A L )J UF'IDEll C 0 FR: Robin L. Sullivan Clerk of the Commission RE: Request for tax benefit - Scientific Materials --~~-~-~---~~-~~~~-~~~~----------~-- In response to questions and concerns raised during and after the Commission's publ ic hearing on the request submitted by Sci-Mat for tax benefit, I telephoned the County Assessor's Office and the Property Assessment Division of the Department of Revenue in Helena, as well as talking to City Attorney Becker. The following comments are submitted for your consideration, as a result of those conversations: 1. The tax benefit may be appl ied only to the equipment which has been installed to date. 2. The tax benefit appl ies on Iy to those taxes levied by the governing body approving the request ( in the case the City) and the school district for the elementary and high schools. 3. The leasehold improvements may not be included, since they have been appraised and assessed as a part of the building; therefore, are being pa id by a party other than the appl icant. 4. Scientific Materials t1as applied for, and received, classification under "research and development. II Under this category, their equipment is ta xed at 3 percent, rather than the standard 9 percent. for personal property tax. 5. The II resea rc h and development" s ta t us must be applied for, and approved, through the Department of Revenue on an annual basis. To qualify, at least 50 percent of the company's revenues must be real ized through researcll and development, as opposed to manufac- turing. (This is submitted simply as a point of information, since there is no statutory prohibition against receiving both the "R&D" status and the tax benefit for "new and expanding industry. ") 6. If the Commission approves this application at Monday's meeting, the County Assessor will apply the tax benefit to this year's personal property tax bill, which wi II be mai led by the end of May. HOME OF MONTANA STATE UNIVERSITY GATEWAY TO YELLOWSTONE PARK