Investment Incentives   Local Tax Abatement This incentive is useful for developers who plan to make substantial improvements to existing historic structures or build new buildings in the Uptown district. Local property taxes are abated for a period of five years if certified historic structures are rehabilitated according to local design guidelines. New buildings must be compatible with existing historic structures in Butte's National Historic Landmark District. The assessed value of the current structure or vacant property is established for the current year. Taxes on the property are frozen at the established level during the construction period while improvements are made. Taxes on the improvement are phased in over a five-year period at 20-percent increments. In Butte-Silver Bow County, property tax liability is calculated as follows: Tax Liability = assessed value x tax rate x mill levy 2003 Property Tax Rate = 3.4% 2003 Mill Levy = 588.96 mill Federal Rehabilitation Tax Credit A 20 percent tax credit is available to developers who rehabilitate certified historic structures. Certified historic structures are those listed in the National Register of Historic Places or are a contributing element in a National Register District. The credit allows a maximum of 20 percent deduction from the developer's federal tax liability. The actual amount of the credit is determined by multiplying the total cost of rehabilitation by 20 percent. To qualify for the tax credit, the developer's building rehabilitation must be approved by the National Park Service (NPS), the U.S. Department of the Interior, and Montana's State Historic Preservation Office (SHPO). In general, the NPS is looking for compatible uses that will enhance and preserve the historic structure. The rehabilitation must conform to architectural design guidelines that preserve the historical integrity of the certified structure. By following the guidelines and working closely with the SHPO and the NPS throughout design and construction, this substantial credit can be procured. Mainstreet Uptown Butte can assist developers with the application process. Example: A business decides to locate in a certified historic building in Uptown Butte. The owners invest $100,000 to rehabilitate the building for commercial use. (Rehab. Cost) $100,000 x 20% (Tax Credit) = $20,000 Tax Credit There is an additional 5 percent state tax credit available to developers who take advantage of the federal tax credit. Example: A business decides to locate in a certified historic building in Uptown Butte. The owners invest $100,000 to rehabilitate the building for commercial use. (Rehab. Cost) $100,000 x 20% (Tax Credit) = $20,000 Federal Tax Credit (Rehab. Cost) $100,000 x 5% (Tax Credit) = $5,000 State Tax Credit. Total Tax Credits = $25,000 The rehabilitation must comply with the Secretary of the Interior's Standards for Rehabilitation. Design assistance is available from the Butte-Silver Bow Urban Revitalization Agency and application assistance is provided by Mainstreet Uptown Butte. Urban Revitalization Agency Incentives The Urban Revitalization Agency offers incentives to developers and business owners to encourage investment in Uptown Butte. This local county government agency was established in 1980 through the creation of a tax increment financing district for the Uptown district. Funds for grants, loans, and other activities are derived from property taxes levied on new development in the district. Basically, this incremental tax revenue is set aside in a specific fund. The incentives described below can be used in different combinations and with other incentives, like the Federal Tax Credit. Note:**URA funds cannot be used if the local tax abatement is used. The incentive is in the form of a grant for facade improvement or for roof repair or replacement. The buildings must be in the URA district (bounded by Arizona Street on the east, Washington Street on the west, Copper Street on the north and Platinum Street on the south). All applications must be reviewed by the URA board and are approved after design review. Total funds available in each year vary based on the value of new developments and increment tax collected. 1. FACADES: Reimbursement grants for up to 30 percent are available for the total cost of improving building facades, including windows. This type of grant does not include roofing or interior improvements, but does include exterior signage. If the developer takes advantage of the Federal Tax Credit, this grant is increased up to 50 percent. Example: $10,000 necessary for facade improvements $7,000 from developer/owner $3,000 from URA funds 2. ROOFS: Reimbursement grants for up to 50 percent are available for the total cost of repairing or replacing a roof. Example: $10,000 necessary for roof improvements $5,000 from developer/owner $5,000 from URA funds For questions about investment opportunities, or questions about investment incentives for Uptown Butte, write to Mainstreet Uptown Butte, P.O. Box 696, Butte, MT 59703; call (406) 497-6464, or send e-mail to Mainstreet Uptown Butte.