Havre city council to look at district for downtown improvements

The Havre city government has agreed to team up with a group trying to revitalize downtown Havre to look into a way to fund improvements.

At the city council meeting last week, Mayor Doug Kaercher set up Downtown Havre Matters! working with the Council's Finance Committee to look into creating a tax increment finance district.

Bear Paw Development Corp. Executive Director Paul Tuss, representing Downtown Havre Matters!, told the committee that Havre has never created one of these districts, commonly called TIFDs, but they have been used by many communities in the state.

“Like I said, this is a new concept for us, but it’s not a new concept, and communities all over Montana have done this,” Tuss said.

Tuss, a Democrat representing Havre in the state House of Representatives, is running for reelection and faces a rematch with Ed Hill, the Havre Republican who used to hold the seat until the 2022 election when Tuss defeated Hill.

Tuss said Downtown Havre Matters! has been kicking the idea of creating a TIFD around for a couple of months and wants the Havre government to help look into the idea.

Tuss said the idea of a TIFD is that the city would create a district — the plan would be for downtown Havre in this case — and any increase in taxes that occur in the district, such as from reappraisals of properties or improvements to properties or new properties being built, would not go to the local governments, but into a fund to use for improvements instead.

“So the city of Havre wouldn’t get the money,” he said. “The county wouldn’t get the money. The school district wouldn’t get the money. It will go into a tax increment finance fund. That would then be distributed by a TIFD committee probably made up of several of you and perhaps some local citizens.”

He added that the district would not be a tax increase.

“We’re not increasing anybody’s taxes,” he said. “We’re simply capturing the logical increase that would occur in this district.”

The governments would still receive the base tax capped at when the district is created, but any increased taxes would go to the district fund for the life of the district, which Tuss said is set in state law at 15 years. After that, the local governments would start receiving the taxes above the base.

Tuss said the district committee could use funds for improvements in the objectives set at the creation of the district, and possibly do things like make low-interest loans to businesses to improve their properties, with the payments on the loan going back into the district fund.

He said the districts have been used successfully in many communities, such as the revitalization of downtown Fort Benton.

Kaercher said the city needs to learn more about how the districts work.

“Downtown Havre Matters! and our Finance Committee, I think, can, you know, go out and delve into this and figure it out,” he said. “So either, we’re going forward with it and we know what we’re going forward with or not.”

Tuss said Bear Paw Development can bring in experts on the topic and people from communities that have used TIFDs to talk about them.

“We can find out the benefits, if there’s any downfalls, if there’s any pitfalls we’re not thinking about, they can talk about that experience, too,” he said.