HomeMy WebLinkAboutElm Board Packet 202009031
Staff Report
To: Midtown Urban Renewal Board
From: David Fine, Urban Renewal Program Manager
Meeting Date: September 3, 2020
Subject: The Elm concert venue
506 N. 7th Ave.
TIF Assistance Program Overview
The Bozeman City Commission created the Midtown TIF Assistance Program in 2017 to
support redevelopment activity and advance the goals of the 2015 Midtown Urban Renewal
Plan. The City Commission amended the Program in January 2020. The Midtown TIF Assistance
Program supports projects that create significant new taxable value as well as meeting the five
goals of the Midtown Urban Renewal Plan. These goals, as required by statute, focus on
mitigating blighting conditions in the urban renewal area. Each of these five goals is further
refined with particular criteria for a total of seventeen categories that can receive points. Point
awards demonstrate specific compliance with the criteria, but are not the only factors the board
may consider in recommending an incentive award. For example, the board may also consider
new taxable value created by the project, or whether the project would be feasible without a
public incentive. In addition to tax generation, the goals of the Urban Renewal Plan and the
need for assistance, the Board must also make affirmative findings as required by State Law.
Recommended Motion:
“Having read considered the Application, the findings of the Staff Report, public comment and
all information presented, I hereby move to recommend that Staff negotiate a development
agreement with the Applicant for the consideration of the Bozeman City Commission for
reimbursement of TIF eligible costs not-to-exceed $288,032.”
Staff Recommendation
The Midtown Action Plan, unanimously adopted by the Bozeman City Commission in
2017, recommends increasing building density within the Midtown Urban Renewal District, with
a particular emphasis on incentivizing infill development and pedestrian oriented amenities that
2
are irreplaceable by ecommerce trends. An event center is an anchor attraction for drawing
people to the Midtown area. Concert goers will patronize adjacent restaurants, bars, and retail
establishments. A venue makes Midtown a destination and as the Action Plan describes,
“increases the number of people in the District, which helps create the desired active pedestrian
environment. More density of buildings grouped together in districts is especially desired to
encourage pedestrians to explore adjacent buildings.” Attractions of this magnitude are rare
and The ELM would drive adjacent existing and new commercial uses in the District. Compatible
attractive uses would reinforce the concept of a walkable commercial node and be an economic
driver for the area.
The ELM is just such a project. The ELM, as currently approved, is a 21,000 square foot
event and entertainment center. The Applicant further describes the project:
[The ELM] is a 1,200-capacity state-of-the-art live performance venue, hosting concerts,
performances and other special events like weddings. There will be two bars, a lounge
area, roof deck, and within the event space a two-story space with balcony seating. The
primary entrance is located on North 7th Avenue….106 bike parking stalls will be
provided for both guests and employees. It is estimated that the facility will be utilized
for 100-150 events per year, attracting an estimated 120,000 people to the site. The ELM
will be the first venue of its size in the Bozeman market. The building relates to the
context of the street and adjacent RSVP Motel.
The project demolished and replaced a building that was approaching the end of its useful life
with a much higher value steel structure that employees a double fronting storefront block
frontage that activates the N. 7th Corridor.
The global pandemic condition created by COVID-19 virus has dramatically altered the
economic landscape for the event and entertainment industry. Large events and resulting
revenue have ceased for the present, with no end in sight. Specifically, using scarce cash to
complete a center that may not be able to return revenue for some time could be a poor
business decision for any venue operator. Completing an event center in context is a challenge
and creates the, “but for”, feasibility conditions that make TIF Assistance necessary for the
feasibility of creating the project.
The Midtown TIF Assistance Program allows the payment of eligible costs of
development to incentivize development that meets the goals of the Midtown Urban Renewal
Plan. The Applicant is applying for several eligible cost areas totaling $288,032. Staff finds that
the proposed costs are eligible for TIF assistance. Staff scored the application based on the
program criteria. Based on our review and the application materials presented, the project
received 31 of 52 available points. The application scored points toward three of five goals of
the Midtown Urban Renewal Plan. The project eliminates blight and advances the District goal
of walkable mixed-use nodes within the District.
Leland Consulting Group (LCG) completed a financial analysis of the project to help staff
evaluate the application for creation of new taxable value. Their report analyzed return on
3
investment (ROI), estimated payback period for the public assistance and proposed target
metrics for the ratio of private investment to public assistance. LGC bases their analysis on
awarding the applicant’s full assistance request. LCG recommends a ratio of private investment
to public assistance of 8:1 or greater for commercial projects; the ratio for this project is
23.19:1.
Staff did not commission a need analysis for this project, since the cost of the analysis
was out of scale with the size of the assistance request.
LCG also created a tax generation model for the Midtown URD. According to their
model, the project would produce net new annual taxes of $62,970, which would allow TIF
assistance to be paid back in 5.5 years (assumes a 5% interest rate on the advanced amount) for
new increment-based payback if assistance is provided at the Applicant’s requested amount.
Staff recommends approval of the project funding request.
Criteria for TIF Assistance
Goal Number 1: Promote Economic Development
1. Tax Generation: The project will increase the taxable value within the District. The increase
in taxable value due to new construction & rehabilitation is estimated by the County
Assessor’s office or State Department of Revenue to determine tax increment generation.
Submit documentation of estimated tax projections to receive points for these criteria.
Leland Consulting Group (LCG) created a tax revenue generation model for the Midtown URD.
Using data provided by the property owner, LCG estimates that the property will provide an
estimated annual net tax revenue increase of $62,970 for the District. The projected net
increase in value of the property is $4,835,300. For the assumptions related to these
projections, please see the LGC report. [4 of 4]
2. Elimination of Blight: The project’s direct and indirect impact on the physical and fiscal
deterioration within the Tax Increment Financing District and the community. Projects that
redevelop underutilized properties will be given priority. The characteristics of an
underutilized site includes land on which development occupies only a small amount,
and/or land or buildings that are or have been vacant for some time. Submit information
showing current conditions of property.
The project eliminates blight by replacing a vacant and aging building near the end of its useful
life, “with little potential for repurposing,” with a modern, steel-framed 22,000 SF event venue.
[4 of 4]
4
3. Employment Generation: Total employment generated by the project assessed in terms of
new permanent and part-time jobs, and construction jobs. Submit documentation of
estimated new jobs to receive points for this criterion.
The project will generate temporary construction jobs. The project will create five full-time
professional jobs, including “Event Manager, Stage Manager, Technical Director, Food and
Beverage Manager and Lighting Director”. The venue will also create 30 part time jobs,
including, “stagehands, event staff, bartenders, support staff, hospitality manager, cleaning
staff, etc.” [2 of 3]
Goal Number 2: Improve Multi-Modal Transportation
4. Facilitates Public Health and Mobility: Project will construct or improve ADA access to and
within existing structures. Provide detailed information demonstrating that the current
condition inhibits public health and mobility and the proposed improvements benefit
accessibility.
This condition is relevant to renovation of an existing structure. New buildings must meet ADA
requirements at the time of construction. [0 of 1]
5. Reduces Resource Demand: Project promotes the use of transit, ride sharing, or car sharing.
Provide plans, agreements or other methods to demonstrate reduction of resource demand.
The project utilizes a shared parking agreement with the Bozeman School District. The site has
also optimized its loading zones to facilitate rideshare options like Uber and Lyft, and will
coordinate directly with operators to facilitate efficient pick-up and drop-off. [1 of 1]
6. Promotes Active Transportation: Project promotes bicycling as an active transportation
option by constructing or improving bike lanes, providing covered bike parking, and/or
participating in a bike share program. Provide plans, agreements or other methods that
demonstrates the project goes beyond the minimum Bozeman UDC requirements for site
development.
The Applicant demonstrates that the project provides significant bike parking, much of it
covered to entice bike access to the venue. [2 of 2]
Goal Number 3: Improve, Maintain, and Support Innovation in Infrastructure
7. Infrastructure Improvements: Project promotes innovation in infrastructure and/or reduces
long term costs of maintenance. Examples include low impact development for stormwater,
incorporation of green roof design into building architecture, or car charging stations. Low
5
impact development (LID) incorporates designs such as bioretention facilities, rain gardens
and permeable pavers. Does the project enable better connectivity or provide critical
infrastructure for the community? Provide plans and descriptions of innovations proposed.
N/A.
[0 of 2]
Goal Number 4: Promote Unified Human Scale Urban Design
8. Vehicular Access Points: The project reduces the number of vehicular access points to the
property and improves the pedestrian experience. Provide plans, agreements or other
methods to demonstrate reduction.
The project removes one existing a drive approach from N. 5th Ave. [2 of 2]
9. Street Orientation: The project enhances the North 7th Ave. entryway corridor by having
buildings oriented toward the street and designed to provide interest and activity.
The project double fronts W. Short St. and N. 7th Ave. providing interest and activity to the N. 7th
Ave. corridor.
“The ELM will provide a great deal of interest and activity from the perspective of North
7th Avenue. The main entrance on North 7th Avenue will include a large, glass entrance
where concertgoers will enter for events. The amount of glass will create a relationship
between the interior of the venue and the streetscape. Additionally, a balcony where
concertgoers can break from events overlooks North 7th Avenue, creating a vibrant
interaction between the venue and the street.”
[2 of 2]
10. Pedestrian Experience: The project enhances the pedestrian experience by using a
storefront block frontage (BMC 38.510) as a component of the project. Key elements of the
frontage would include façade transparency, building articulation, street furniture and/or
landscaping. Submit plans and details that address this criterion.
Staff concurs with the Applicant’s assessment for this criterion:
Developing a building with identity and character was a primary goal of the design. The
design team recognized the importance of creating a look and feel that communicated the
ELM as a place of energy and excitement. Critical to this goal was to design a streetscape
that is engaging and comfortable, and that incorporates an interesting pedestrian
experience. Expansive glazing connects the interior to the street and public view, so that on
the night of an event, the vibe within will visibly spill out to the streetscape. The strongly
defined entrance and corner statement anchor the building on the site and clearly
6
communicate that this is a civic and cultural space that is open to the public. Landscape
plantings and lighting, site furnishings and commissioned artwork, soften the edge between
building, street and pedestrian. Ample sidewalk space and exterior lighting will provide for
safety, comfort and traffic flow around the building. This is a very important consideration as
these spaces must handle a large volume of people both moving through and queuing up for
entrance to an event. There are also canopies that extend to create covered areas that serve
to scale down the facade to the human streetscape scale and provide cover in inclement
weather. Extensive bike parking is provided under canopies and well lit with the intent that
this encourages people to bike to events rather than drive. Designated and managed drop-
off and pick-up areas are also in place on North 7th Avenue to help ease traffic and
encourage alternative travel options. [2 of 2]
11. Quality of the Development Exceeds Minimum Requirements: The quality of development
and overall aesthetics (architectural, site design, landscaping, etc.) are beyond that which is
minimally required by the UDC. Provide a narrative and submit documentation to
demonstrate compliance with this criterion.
Based on preliminary renderings, the project as proposed appears to exceed the requirements
of the UDC for architecture, site design, and landscaping. [1 of 1]
Goal Number 5: Support Compatible Urban Density Mixed Land Uses
12. Increases Housing Units: The project increases housing units within the District. Submit
plans demonstrating an increase in the number of housing units.
The project includes no residential units. [0 of 6]
13. Mix of Uses Including Residential: The project is a mix of residential and commercial.
Commercial uses include retail, restaurant, office and services. Hotels would not be
supported unless included with a project that included residential development. Submit
plans detailing the proposed mix of uses within the project.
The project only includes a mix of eligible commercial uses including retail, office and service
uses. The project does not include a residential component. [0 of 6]
14. Shared Parking: The project shares parking among compatible uses. Provide details
demonstrating compliance with the UDC and as well as total number of parking spaces
reduced because of a shared arrangement.
The project will share parking with Whittier Elementary School, since The ELM operates during
complementary hours. “The ELM is also in discussions with neighboring retail stores to utilize
off-hours parking. [2 of 2]
7
15. Affordable Dwelling Units: The project provides affordable dwelling units. For the purposes
of this criterion, an affordable dwelling unit is defined as a unit that requires no more than
33 percent of a household’s income for housing payments based on a designated
percentage of area median income (AMI). Eligible rental units shall be affordable at 70%
AMI and eligible for sale units shall be affordable at 90% AMI. Condominium units are
eligible as for sale units. Additional points may be awarded for projects that provide on-site
housing for the proposed workforce.
Eligible rental dwellings to be constructed in the proposed residential development shall be
provided by long-term contractual obligation to an affordable housing agency, for a period
of not less than 20 years, with a written plan assuring ongoing affordability pricing and
eligibility monitoring, and annual re-certification. The city's affordability guidelines and
subsequent revisions establish affordability and eligibility. To receive 3 points under this
criterion, 10% of all units must meet the affordability criteria. To receive 6 points under this
criterion, 20% of all units must meet the affordability criteria.
The project does not include dwelling units of any kind. [0 of 3 or 6]
Overall District Relevance
16. Relevance to the Midtown Urban Renewal Plan: Documentation of the project’s impact in
relation to the goals and objectives of the Midtown Urban Renewal Plan, particularly mixed-
use development. Urban design elements are also considered, including pedestrian
emphasis and quality of design.
The ELM eliminates blight and benefits economic development by replacing an aging and vacant
structure with a modern event center valued at $6.9 million. The project creates direct
employment and has the potential to be a catalyst for neighboring businesses, truly serving as
an anchor attraction for the Midtown area. The project received nearly perfect scores for 4 of 5
goals of the urban renewal plan. As a single purposed building without a housing component, it
is difficult to receive points for mixed-use or housing categories. [5 of 5]
17. Private / Public Investment Ratio: The investment of public funds in the project results in a
leverage ratio of at least 10:1 for multifamily, 8:1 for commercial, or 5:1 for family wage
jobs. [4 of 4]
The ratio for this project is 23.19:1, yielding significant private investment for a relatively
modest public investment.
8
Total Points (31/52)
9
Criteria for Approval of Urban Renewal Project, 7-15-4217 MCA
1) a workable and feasible plan exists for making available adequate housing for the
persons who may be displaced by the project;
The project does not displace any persons or housing.
2) the urban renewal plan conforms to the comprehensive plan or parts thereof for the
municipality as a whole;
The project is a commercial project located in an area designated for community
commercial mixed-use in the Bozeman Community Plan.
3) the urban renewal plan will afford maximum opportunity, consistent with the sound
needs of the municipality as a whole, for the rehabilitation or redevelopment of the
urban renewal area by private enterprise; and
The project includes a request for tax increment financing assistance that makes the
proposed redevelopment project feasible to be undertaken by private enterprise.
4) a sound and adequate financial program exists for the financing of said project.
The Midtown Urban Renewal District currently has adequate reserves to support
the tax increment finance assistance for this project with a budget amendment to
the approved FY 2021 Work Plan and Budget.
ELM Project
Tax Increment Analysis
August 28, 2020
Prepared by:
Andy Parks, CPA
Leland Consulting Group/GEL Oregon, Inc.
on behalf of the City of Bozeman Economic Development Department
Summary
Applicant plans to build a music venue and events center located at 605 N. 7th Avenue.
Applicant plans to invest approximately $7.0 million (net of land value) and is requesting $288,032 from the Agency.
* Return on Investment (ROI)
* Estimated payback period, and
The following schedule summarizes analysis findings:
Estimated value of completed project 6,966,400$
Estimated capitalized interest - Included in value (soft costs)
Less: 2019 market value per assessor 2,131,100
Net estimated increase in value 4,835,300
Allocation of increase to residential -
Allocation of increase to commercial 4,835,300
Estimated net increase in taxable value 91,387
TIF tax rate - estimated - FY 2023 689.04
Estimated incremental taxes (TIF) - annual (FY 2023)62,970 Note: TIF may be realized in FY 2022, see below
TIF investment 288,032
ROI - estimated 21.9%
Estimated payback period (years)5.50 assumes 5.0% interest rate on advanced amount
Private investment to public investment 23.19 Metric for private to public investment:
Assumptions
Cost and timing information provided in application
Estimated start date Oct-20
Estimated completion Dec-20
Increase in property taxes applicable fiscal year 2023 (potentially FY 2022, however given current economic situation, gave additional year)
Construction Interest - estimated Included in applicants soft costs
Value of existing properties
Address Parcel ID Market Taxable
605 N. 7th Avenue - land RGG5538 760,965 14,382
605 N. 7th Avenue - improvements RGG5538 2,131,100 40,278
Total 2,892,065 54,660
Note: The value of improvements for tax year 2019-20 appear to be significantly greater than values in previous years. Per review of prior
year tax amounts due the peak year was 2014-15, $12,107 paid; 2019-20 taxes were $35,284. Taxes in 2015-16 - 2018-19 were less than
both 2014-15 and 2019-20.
Without confirming, and per review of the application materials, it appears the buildings on the site were removed subsequent to the 2014-15
valuation, with construction of a portion of the new buildings prior to Jan 2019.
The analysis above reflects the difference in value of the project from its status as of January 2019 to its completion in December 2020. Therefore,
the actual payback and return on investment would likely be greater as the value of the demolished buildings appear to be less than the value
of the partially completed improvements.
Greater than 10 to 1 - multi-family
Greater than 8 to 1 - commercial
Greater than 5 to 1 - family wage jobs
The property valuation used in the analysis is based on the sources and uses information provided by the applicant. Different valuation methods
include but are not limited to; income approach, sales comparisons, construction cost and Capital Asset Pricing Model.
06-0798-12-1-48-10-0000
Geo Code
06-0798-12-1-48-10-0000
Analysis has been performed to determine:
* Private investment to public investment
Per total uses for project as provided by applicant
See detail and note below - improvements only
MIDTOWN URBAN RENEWAL DISTRICT
TAX INCREMENT FINANCING ASSISTANCE (TIF) APPLICATION
Submitted by Stonefly Capital, LLC
PART 1
Property Information
Applicant Information
Company Profile
Project Detail
Additional Information
Midtown TIF Assistance Application Part 1 Page 1
Midtown Urban Renewal District
TAX INCREMENT FINANCING ASSISTANCE (TIF) APPLICATION
PART 1
Property Information
Property Address: __ 506 N. 7th Avenue, Bozeman, MT 59715
Property Owner: Nick Checota, Stonefly Capital, LLC (ground lessee)
Legal Description: Violett Addition, S12, T02 S, R05 E, Block 2, Lot 1A, Acres 1.625, Plat E-1-B
Property Geo-Code: 06-0798-12-1-48-10-0000
County Tax ID #:
Applicant Information
o Property Owner
o Tenant
o Developer
o Other Ground Lessee
Applicant’s primary contact:
Name: Nick Checota
Business Name: Stonefly Capital, LLC
Business Phone: ____ (406) 830-4640______________________Cell Phone: (406) 544-7440
Email: nick@logjampresents.com
Project Representative (if not applicant):
Name:
Business Name:
Business Phone: _______________________________Cell Phone:
Email:
Property Owner (if not applicant):
Name:
Business Name:
Business Phone: _______________________________Cell Phone:
Email:
X
Midtown TIF Assistance Application Part 1 Page 2
Company Profile
Business Location
o New business establishing itself in Bozeman
o Existing business
o Expanding/remodeling at same location
o Expanding to an additional location
o Existing business relocating from (identify location):
Street Address: Stonefly Capital, LLC
City: Missoula State: MT Zip: 59802
o Other:
Year Business Established: 2011
Type of Business (Describe): Real Estate Company
Has a business plan been developed in relation to the proposed project?
o No (Development of a business plan may be required as part of the application process)
o Yes (Include a copy with the application)
Project Detail
Property Status:
o Vacant land
o Building on leased land – Describe: Music venue and event center (The ELM) being developed
on land ground leased from The RSVP Motel, LLC.
o Land and building(s) – Describe:
Type of TIF Assistance Sought:
o Requesting assistance for public infrastructure costs
o Building demolition
Value of TIF Assistance Sought:
$ 288,032
Will this project proceed if TIF assistance is not granted?
o No
o In a limited fashion (explain):
o Yes, but at a later date (explain): Given the impact of the pandemic on the entertainment
industry, it is unclear when we could re-start the project.
o Yes, as scheduled
o Other:
X
X
X
X
X
X
Midtown TIF Assistance Application Part 1 Page 3
Please attach a list of all other property owners, business partners, developers and/or investors
associated with this project, with the above information provided for each.
This application must be signed by both the applicant(s) and the property owner(s) (if different).
I (we), by signature below, certify that the information supplied in this application is, to the best of my
(our) knowledge, true, accurate, and complete, and is provided for the purpose of obtaining approval to
participate in the Midtown Urban Renewal District TIF assistance program. I (we) understand that
failure to comply with the terms of the TIF assistance program may result in revocation of an award.
I (we) understand the work to be undertaken must be in accordance with all applicable requirements of
the Bozeman Municipal Code and any special conditions established by the approval authority and must
receive all required approvals prior to commencing the work. I (we) understand if approved for TIF
assistance, the work to be performed must also be in accordance with TIF assistance program
procedures and the general design guidelines for the District, as well as the specific plans approved for
the project. I (we) acknowledge that the City has an Impact Fee Program and impact fees may be
assessed for my project. Further, I (we) agree to grant City personnel and other review agency
representative’s access to the subject site during the course of the review process (Section 38.34.050,
BMC).
Applicant (s) (Print Name) Nick Checota
August 25, 2020
Signature of Applicant Date
Property Owner(s) (Print Name) Nick Checota
August 25, 2020
Signature of Property Owner Date
Midtown TIF Assistance Application Part 1 Page 4
Additional Information
1. Project Narrative
Provide an overview of the project in narrative format. The narrative must include a description of
the following aspects of the project:
§ Proposed use(s) of project
o e.g. industrial, commercial, retail, office, mixed use, residential for sale or for rental, etc.
o Total number and individual square footage of residential units; type of residential units
(e.g. for-sale, rental, condominium, single-family, etc.); number and type of parking
spaces provided; and construction phasing.
§ Project Timeline
o Include anticipated dates for site acquisition, project start and completion, as well as
other project milestones. Multi-phase projects must include details for each phase. The
timeline should also identify any critical or time-sensitive dates as well as any time
constraints facing the applicant.
§ Construction information
o size of any existing structure to be demolished or rehabbed; size of any new
construction; types of construction materials (structural and finish); delineation of
square foot allocation by use
§ Public Benefits
o Projects with a high degree of public benefits are typically more likely to receive TIF
assistance. The criteria on pages 4-6 of this application are intended to help the Board
understand and evaluate the public benefits for a project. Provide a detailed narrative
response to each criterion and include supporting documentation.
2. Site Maps and Building Plans
The Applicant must submit a completed Conceptual Review Application and City responses to the
Board. The Conceptual Review application must include, at minimum:
o Photographs of project site and/or building
o Map showing the location of the site and its immediate surroundings
o Proposed development plans including site plans, floor plans indicating square footage and
layout, building elevations
o Description of parking accommodations for residential units and commercial uses
o Estimated date of occupancy
o Anticipated off-site infrastructure improvements, including anticipated costs
o Copy of Concept Review comments
X
X
X
X
X
X
Midtown TIF Assistance Application Part 1 Page 5
CRITERIA FOR TIF ASSISTANCE
The Board will review each TIF assistance application the Board using the following criteria and point
system. Points can range from 0 to the maximum shown below in each category. The following criteria
will be used to rate your project. To receive points for any given item, provide a detailed narrative
response to each criterion and include documentation demonstrating adherence to the criteria must be
submitted with the application. The Board will use this information to evaluate the project.
Midtown District Goals Points
Promote Economic Development
1. Tax Generation: The project will increase the taxable value within the District. The
increase in taxable value due to new construction & rehabilitation is estimated by
the County Assessor’s office or State Department of Revenue to determine tax
increment generation. Submit documentation of estimated tax projections to
receive points for this criterion.
4 /4
2. Elimination of Blight – The project’s direct and indirect impact on the physical and
fiscal deterioration within the Tax Increment Financing District and the community.
Projects that redevelop underutilized properties will be given priority. The
characteristics of an underutilized site includes land on which development occupies
only a small amount, and/or land or buildings that are or have been vacant for some
time. Submit information showing current conditions of property.
4 /4
3. Employment Generation – Total employment generated by the project assessed in
terms of new permanent and part-time jobs, and construction jobs. Submit
documentation of estimated new jobs to receive points for this criterion.
3 /3
Improve Multi-Modal Transportation
4. Facilitates Public Health and Mobility: Project will construct or improve ADA access
to and within existing structures. Provide detailed information demonstrating that
the current condition inhibits public health and mobility and the proposed
improvements benefit accessibility.
1 /1
5. Reduces Resource Demand: Project promotes the use of transit, ride sharing, or car
sharing. Provide plans, agreements or other methods to demonstrate reduction of
resource demand.
1 /1
6. Promotes Active Transportation: Project promotes bicycling as an active
transportation option by constructing or improving bike lanes, providing covered
bike parking, and/or participating in a bike share program. Provide plans,
agreements or other methods that demonstrates the project goes beyond the
minimum Bozeman UDC requirements for site development.
2 /2
Improve, Maintain and Support Innovation in Infrastructure
7. Infrastructure Improvements: Project promotes innovation in infrastructure and/or
reduces long term costs of maintenance. Examples include low impact development
for stormwater, incorporation of green roof design into building architecture, or car
charging stations. Low impact development (LID) incorporates designs such as
bioretention facilities, rain gardens and permeable pavers. Does the project enable
better connectivity or provide critical infrastructure for the community? Provide
plans and descriptions of innovations proposed.
0 /2
Promote Unified Human Scale Urban Design
8. The project reduces the number of vehicular access points to the property and
improves the pedestrian experience. Provide plans, agreements or other methods to
2 /2
Midtown TIF Assistance Application Part 1 Page 6
demonstrate reduction.
9. The project enhances the North 7th Ave. entryway corridor by having buildings
oriented toward the street and designed to provide interest and activity.
2 /2
10.
The project enhances the pedestrian experience by using a storefront block frontage
(BMC 38.510) as a component of the project. Key elements of the frontage would
include façade transparency, building articulation, street furniture and/or
landscaping. Submit plans and details that address this criterion.
2 /2
11. The quality of development and overall aesthetics (architectural, site design,
landscaping, etc.) are beyond that which is minimally required by the UDC. Provide a
narrative and submit documentation to demonstrate compliance with this criterion.
1 /1
Support Compatible Urban Density Mixed Land Uses
12. The project increases housing units within the District. Submit plans demonstrating
an increase in the number of housing units.
0 /6
13. The project is a mix of residential and commercial. Commercial uses include retail,
restaurant, office and services. Hotels would not be supported unless included with
a project that included residential development. Submit plans detailing the
proposed mix of uses within the project.
0 /6
14. The project shares parking among compatible uses. Provide details demonstrating
compliance with the UDC and as well as total number of parking spaces reduced
because of a shared arrangement.
2 /2
15. The project provides affordable dwelling units. For the purposes of this criterion, an
affordable dwelling unit is defined as a unit that requires no more than 33 percent of
a household’s income for housing payments based on a designated percentage of
area median income (AMI). Eligible rental units shall be affordable at 70% AMI and
eligible for sale units shall be affordable at 90% AMI. Condominium units are eligible
as for sale units. Additional points may be awarded for projects that provide on-site
housing for the proposed workforce.
Eligible rental dwellings to be constructed in the proposed residential development
shall be provided by long-term contractual obligation to an affordable housing
agency, for a period of not less than 20 years, with a written plan assuring ongoing
affordability pricing and eligibility monitoring, and annual re-certification. The city's
affordability guidelines and subsequent revisions establish affordability and
eligibility. To receive 3 points under this criterion, 10% of all units must meet the
affordability criteria. To receive 6 points under this criterion, 20% of all units must
meet the affordability criteria.
0 /3
or 6
Overall District Relevance
16. Relevance to the Midtown Urban Renewal Plan – Documentation of the project’s
impact in relation to the goals and objectives of the Midtown Urban Renewal Plan,
particularly mixed-use development. Urban design elements will also be considered,
including pedestrian emphasis and quality of design.
5 /5
17. The investment of public funds in the project results in a leverage ratio of at least
10:1 for multifamily, 8:1 for commercial, or 5:1 for family wage jobs.
4 /4
Total Points 33 /50
Midtown TIF Assistance Application Part 1 Page 7
APPROVAL (For Official Use Only)
Approval Status:
Date Approved:
Date Letter of Award Sent:
Date Certificate of Completion:
Date of Payment Request:
Additional Information -Project Information
PROJECT NAME
THE ELM
PROJECT DESCRIPTION
The ELM is a music venue and event center being developed by Stonefly
Capital, LLC on land ground leased from The RSVP Motel, LLC. The capacity
of the ELM will be 1,200 (standing floor / seated balcony) or 650 (fully seated).
PROPERTY INFORMATION
Physical Address -605 N. 7th Avenue, Bozeman, MT 59715
Legal Description –Violett Addition, S12, T02 S, R05 E, Block 2, Lot 1A, Acres
1.625, Plat E-1-B
Property Geo-Code -06-0798-12-1-48-10-0000
Property Owner -Stonefly Capital, LLC
Land Owner -The RSVP Motel, LLC
PRIMARY CONTACT
Nick Checota, Owner, Stonefly Capital, LLC, (406) 544-7440
ESTIMATED COMPLETION DATE
Restart Development -October 1, 2020 --Project Completion -December 1, 2020
Additional Information -Project Narrative
The proposed 21,000 square foot event and entertainment center (the “ELM”) is a 1,200-capacity
state-of-the-art live performance venue, hosting concerts, performances and other special events
like weddings.There will be two bars, a lounge area, roof deck, and within the event space a two-
story space with balcony seating.The primary entrance is located on North 7th Avenue.Service
loading, equipment delivery and staging will occur within a screened loading area at the rear the of
the building.106 bike parking stalls will be provided for both guests and employees.It is estimated
that the facility will be utilized for 100-150 events per year, attracting an estimated 120,000 people
to the site. The ELM will be the first venue of its size in the Bozeman market.
The building relates to the context of the street and adjacent RSVP Motel.The building has a
strong identity and defines the streetscape following the Storefront Block Frontage along North
7th Avenue and West Short Street.Landscape Block Frontage along North 6th Avenue provides
a landscaped buffer between the screened loading area and the covered bike parking.
PROPOSED USE(S) OF PROJECT
The ELM has already commenced construction and is approximately 90 percent complete.Due
to the significant impact COVID-19 has had on the entertainment industry, the project has been
placed on hold.Based on the current completion of the project, we estimate that it would take
approximately two months to complete. A TIF award would enable the development of the ELM
to immediately proceed to completion.
PROJECT TIMELINE
Prior to the commencement of construction on the ELM, an existing, older structure that served
as a mixed carpet store was demolished.As indicated above, the new facility, will be 100 percent
utilized as an event center, and is a fully steel structure, built with high-quality materials.This
special-use facility will serve as one of, if not the nicest event facility of its size in the State of
Montana.
CONSTRUCTION INFORMATION
Once complete, the ELM will create a significant public benefit for Bozeman as a whole, and the
redevelopment of Midtown in particular. The ELM will serve as an important economic driver.
PUBLIC BENEFITS
Additional Information -Site Maps and Building Plans
EXISTING BUILDING (DEMOLISHED)
Additional Information -Site Maps and Building Plans
RENDERINGS OF THE ELM
Additional Information -Site Maps and Building Plans
STREET MAP AND SITE PLAN
Additional Information -Site Maps and Building Plans
Main Entrance
Merch Area
Box Office
MAIN LEVEL
UPPER LEVEL / BALCONY
Additional Information -Criteria for TIF Assistance
1. Tax Generation: 4 / 4
PROMOTE ECONOMIC DEVELOPMENT
The project will increase the taxable value within the District. The increase in taxable value due
to new construction & rehabilitation is estimated by the County Assessor’s office or State
Department of Revenue to determine tax increment generation. Submit documentation of
estimated tax projections to receive points for this criterion.
The project will increase the table value of the District.With a Bank Appraised value of
$6,900,000 and construction costs of $6,600,000, the table value of the property will increase
significantly.
2. Elimination of Blights: 4 / 4
The project’s direct and indirect impact on the physical and fiscal deterioration within the Tax
Increment Financing District and the community. Projects that redevelop underutilized
properties will be given priority. The characteristics of an underutilized site includes land on
which development occupies only a small amount, and/or land or buildings that are or have
been vacant for some time. Submit information showing current conditions of property.
The structure that existed prior to the ELM construction was a vacant, two-story, 7,700 square
foot warehouse-like building that had little potential for repurposing. The existing building’s
previous use was Tom's Flooring, a retail flooring store that is no longer in operation.The
existing building was a two-story building with a barrel-vaulted timber ceiling structure
bearing on masonry brick walls.
The ELM will serve as a cultural hub for the Midtown District.It will not only bring thousands
of concertgoers to the new facility, but will serve as an economic driver for hotels, restaurants
and bars in the area.As has been seen with the redevelopment of the Wilma and Top Hat in
downtown Missoula, events bring a vibrancy to an area both economically and culturally. It is
estimated that for every $1 spent on a ticket, a total of $10 -$12 in direct and indirect
economic activity is generated (source --The Chicago Loop Alliance).
Additional Information -Criteria for TIF Assistance
3. Employment Generation: 3 / 3
Total employment generated by the project assessed in terms of new permanent and part-time
jobs, and construction jobs. Submit documentation of estimated new jobs to receive points for
this criterion.
The ELM has created hundreds of jobs during construction. Once in operation, it is estimated
the ELM will create five full-time salaried positions and approximately 30 part-time
positions.Full-time salaried jobs include: Event Manager, Stage Manager, Technical Director,
Food and Beverage Manager and Lighting Director.Part-time jobs include:stagehands, event
staff, bartenders, support staff, hospitality manager, cleaning staff, etc.
4. Facilitates Public Health and Mobility: 1 / 1
IMPROVE MULTI-MODAL TRANSPORTATION
Project will construct or improve ADA access to and within existing structures. Provide detailed
information demonstrating that the current condition inhibits public health and mobility and
the proposed improvements benefit accessibility.
In B-2M zoning, minimum off-street parking is zero, therefore, no ADA parking is required
for this project.However, the design considers accommodations for access for those with
mobility impairment by an on-street passenger loading zone on West Short Street.Also, there
are two existing ADA parking spaces on site (immediately to the North of the loading area and
within the RSVP Motel parking lot).Additionally, a parking agreement between the Bozeman
school district and the ELM is in place for use of their parking lot after school hours and during
event operations.This parking lot also includes ADA parking.
5. Reduces Resource Demand: 1 / 1
Project promotes the use of transit, ride sharing, or car sharing. Provide plans, agreements or
other methods to demonstrate reduction of resource demand.
It is anticipated the many attendees of events at the ELM will take public transit, rideshare
services, walk or bike.The venue will work closely with rideshare partners such as Uber, to
coordinate drop-off and pick-up areas.Management at the venue routinely coordinates
rideshare services for customers. With respect to public transportation, the venue will
include information on our website and social channels to market and promote transportation
options. Lastly, management of the ELM has entered into a lease agreement to share parking
with the school during off-school hours. Management is also in discussions with neighboring
retail outlets to share off-hour parking.
Additional Information -Criteria for TIF Assistance (continued)
6. Promotes Active Transportation: 2 / 2
Project promotes bicycling as an active transportation option by constructing or improving bike
lanes, providing covered bike parking, and/or participating in a bike share program. Provide
plans, agreements or other methods that demonstrates the project goes beyond the minimum
Bozeman UDC requirements for site development.
Extensive on-site bike parking will be located adjacent to the building.Much of the bike
parking area is under cover and screened by landscaping, which will offer an attractive option
for alternative transportation.Employee bike parking is also proposed within the screened
loading area, bringing the total number of bike parking spaces to 106.
7. Infrastructure Improvements: 0 / 2
IMPROVE, MAINTAIN AND SUPPORT INNOVATION IN INFRASTRUCTURE
Project promotes innovation in infrastructure and/or reduces long term costs of maintenance.
Examples include low impact development for stormwater, incorporation of green roof design
into building architecture, or car charging stations. Low impact development (LID) incorporates
designs such as bioretention facilities, rain gardens and permeable pavers. Does the project
enable better connectivity or provide critical infrastructure for the community? Provide plans
and descriptions of innovations proposed.
N/A
8. Vehicular Access Points: 2 / 2
PROMOTE UNIFIED HUMAN SCALE URBAN DESIGN
The project reduces the number of vehicular access points to the property and improves the
pedestrian experience. Provide plans, agreements or other methods to demonstrate reduction.
The ELM will not allow for any vehicular access beyond the band load-in area.Given the
nature of events, the sidewalks have been designed for customer queuing and assembly.
The project will include benches, a walk-up ticket window, etc.
Additional Information -Criteria for TIF Assistance (continued)
9. Entryway Corridor Enhancement: 2 / 2
The project enhances the North 7th Ave. entryway corridor by having buildings oriented toward
the street and designed to provide interest and activity.
The ELM will provide a great deal of interest and activity from the perspective of North 7th
Avenue.The main entrance on North 7th Avenue will include a large, glass entrance where
concertgoers will enter for events.The amount of glass will create a relationship between
the interior of the venue and the streetscape. Additionally, a balcony where concertgoers can
break from events overlooks North 7th Avenue, creating a vibrant interaction between the
venue and the street.
10. Pedestrian Experience Enhancement: 2 / 2
The project enhances the pedestrian experience by using a storefront block frontage (BMC
38.510) as a component of the project. Key elements of the frontage would include façade
transparency, building articulation, street furniture and/or landscaping. Submit plans and
details that address this criterion.
Developing a building with identity and character was a primary goal of the design.The
design team recognized the importance of creating a look and feel that communicated the
ELM as a place of energy and excitement.Critical to this goal was to design a streetscape
that is engaging and comfortable, and that incorporates an interesting pedestrian experience.
Expansive glazing connects the interior to the street and public view, so that on the night of
an event, the vibe within will visibly spill out to the streetscape.The strongly defined
entrance and corner statement anchor the building on the site and clearly communicate that
this is a civic and cultural space that is open to the public.Landscape plantings and lighting,
site furnishings and commissioned artwork, soften the edge between building, street and
pedestrian.Ample sidewalk space and exterior lighting will provide for safety, comfort and
traffic flow around the building.This is a very important consideration as these spaces must
handle a large volume of people both moving through and queuing up for entrance to an
event. There are also canopies that extend to create covered areas that serve to scale down
the facade to the human streetscape scale and provide cover in inclement weather.Extensive
bike parking is provided under canopies and well lit with the intent that this encourages
people to bike to events rather than drive.Designated and managed drop-off and pick-up
areas are also in place on North 7th Avenue to help ease traffic and encourage alternative
travel options.
Additional Information -Criteria for TIF Assistance (continued)
SUPPORT COMPATIBLE URBAN DENSITY MIXED LAND USES
12. Housing Units: 0 / 6
The project increases housing units within the District.
N/A
13. Mixed Use: 0 / 6
The project is a mix of residential and commercial.
N/A
14. Parking: 2 / 2
The project shares parking among compatible uses. Provide details demonstrating compliance
with the UDC and as well as total number of parking spaces reduced because of a shared
arrangement.
The ELM will share parking with Hawthorn Elementary School, utilizing the parking during its
off hours. The ELM is also in discussions with neighboring retail stores to utilize off-hours
parking.
11. Overall Aesthetics: 1 / 1
The quality of development and overall aesthetics (architectural, site design, landscaping, etc.)
are beyond that which is minimally required by the UDC. Provide a narrative and submit
documentation to demonstrate compliance with this criterion.
As a music, entertainment and event venue, the design of the building intends to create
an energetic and engaging presence on the corner of North 7th Avenue and West Short
Street.Regardless of the time of day, or whether there is an event occurring or not, the
building expresses itself as a unique one-of-a-kind place and public cultural space.The
building's design style is is a blend of restrained contemporary form and mountain-modern,
which are both styles that are common to and representative of architectural trends in
Bozeman. The style of building is unique to the district, but sets a standard for creativity
and public engagement that should encourage other quality developments.
Additional Information -Criteria for TIF Assistance (continued)
17. Investment of Public Funds: 4 / 4
The investment of public funds in the project results in a leverage ratio of at least 10:1 for
multifamily, 8:1 for commercial, or 5:1 for family wage jobs.
TOTAL POINTS: 33 / 50
15. Affordable Dwelling Units: 0 / 3
The project provides affordable dwelling units.
N/A
OVERALL DISTRICT RELEVANCE
16. Relevance to Midtown Urban Renewal Plan: 5 / 5
Relevance to the Midtown Urban Renewal Plan –Documentation of the project’s impact in
relation to the goals and objectives of the Midtown Urban Renewal Plan, particularly mixed-use
development. Urban design elements will also be considered, including pedestrian emphasis
and quality of design.
The ELM fits in well with the overall redevelopment goals of the Midtown District. First, the
ELM will directly expand the tax base of the area, replacing an older, unoccupied structure
with a new building valued at approximately $6.9 million. Second, the ELM will have a direct
impact on economic and business development within the District. The crowds that attend
ELM events will spend money at neighboring restaurants, hotels and businesses. Third, the
ELM caused the demolition of a blighted building and replaced it with a new, state-of-the-art
event center.
PART 2
Sources and Uses of Funds
Development Budget
Budget of TIF Eligible Expenses
Financial Commitments
Midtown TIF Assistance Part 2 Page 8
PART 2
FOR PROJECTS REQUESTING OVER $50,000 IN ASSISTANCE
Project Financial Information
In order for the Midtown Urban Renewal District Board to adequately review applications seeking TIF
assistance, the following information must be submitted with the application. This information will be
used to perform a third-party financial analysis to determine the project’s anticipated return on
investment (ROI) and reasonableness of developer profit. The goal of the Midtown TIF Assistance
program is to make projects financially feasible. Therefore, projects that demonstrate financial need for
public funding will be given priority.
1. Sources & Uses of Funds
a. Identify the sources of funds used to finance the project. Typical sources include equity, lender
financing, mezzanine financing, other anticipated types of public assistance, and any other types
or methods of financing. Describe the sources of equity and include a term sheet for lender
financing, if available.
b. TIF assistance is available as a reimbursement after the project is complete. Thus, the project
budget must identify the up-front sources intended to finance the development costs of the
project. If determined, specify the specific line items of the project budget that each source will
finance.
c. Summarize the uses of funds. General categories to be identified include acquisition and related
site costs, hard construction costs, and a breakdown of soft costs.
2. Development Budget
Provide an accurate and detailed development budget for the project that includes a detailed
breakdown of significant line item costs consistent with the sample included in the application packet.
The budget should be arranged to identify acquisition and site related costs, hard costs, and soft costs.
Also, identify all line items that are performed by the developer, owner, or related entities.
3. Budget of TIF Eligible Expenses
Identify which of the development budget costs are eligible for reimbursement as allowed by 7-15-
4288, MCA.
4. Financial Commitments
Submit commitment letters and/or term sheets from all lenders for proposed debt (such as
construction, mezzanine, permanent, and government financing) and all other financial sources of
the project (such as grants, and tax credits). Commitment letters must clearly specify the nature and
terms of the obligations.
Sources and Uses of Funds
FINANCING INFORMATION
The ELM Sources and Uses of Funds statement below shows a cash investment
from Stonefly Capital, LLC. Construction has been financed locally at First
Interstate Bank in Missoula.
USES OF FUNDS
Soft Costs $1,255,000
-Engineering, Architecture, Planning, Permitting,
Carrying Costs, Etc.
Hard Costs $5,711,400
-Direct Construction Costs
TOTAL USES OF FUNDS $6,966,400
SOURCES OF FUNDS
Cash -Stonefly Capital, LLC $1,468,368
Cash -TIF, Midtown Urban Renewal District $288,032
Construction Loan -First Interstate Bank $5,210,000
TOTAL SOURCES OF FUNDS $6,966,400
Development Budget
Item Budget
HARD CONSTRUCTION COSTS
Sitework - Demo 611,000
Concrete 350,000
Metals 950,000
Material, Finishes & Carpentry 1,496,800
Thermal & Moisture Proof 359,100
Specialties 38,000
Hoisting & Conveying 60,000
Mechnical & Plumbing 995,000
Electrical 675,000
Cleaning & Protection 15,000
DIRECT CONSTRUCTION COSTS SUBTOTAL 5,549,900
OTHER
General Conditions 126,500
Insurance 35,000
OTHER SUBTOTAL 161,500
TOTAL HARD CONSTRUCTION COSTS 5,711,400
OTHER COSTS
SOFT COSTS
Contingency 525,000
Housing 100,000
Architect and Engineering 300,000
Legal 25,000
Entitlements (permits, etc)55,000
Impact Fees to City of Bozeman 150,000
Interest During Construction 100,000
TOTAL SOFT COSTS 1,255,000
GRAND TOTAL 6,966,400
BUDGET LINE ITEM
Demolition of Existing Building $70,832
City of Bozeman Impact Fees $152,000
Sidewalks, Curbs and Other $55,000
Right-of-Way Improvements
Utility Lines $10,200
ESTIMATED TOTAL $288,032
Budget of TIF Eligible Expenses