MISSOULA – A lease agreement signed at a different economic time in Missoula underwent some changes this week after AT&T / Direct TV extended its lease in the county’s tech district for an additional five years.
The lease extension includes a basic monthly rent of approximately $ 66,000. The county passes much of that on to the state to buy back the principal of an infrastructure loan it used to attract Direct TV to Missoula and the jobs it provides.
“We didn’t borrow it – it was a conduit borrowed through us with the Montana Board of Investments with Direct TV. They borrowed the money to build this call center. We own the land and lease it to them, ”County OAC Andrew Czorny said.
Of that funding, the county keeps about $ 7,000 a month in lease payments, Czorny said.
The payments arise from the excess funding of tax increases in the Tech District. AT&T / Direct TV has been the district’s sole tenant for much of that time, and its payments are slowly paying off the debt.
“The way the original deal is put together, at the end of each rental period, we take any excess tax increases in the district and give that money, after our expenses, to the state to pay it back. the principal, ”said Emily Brock. , director of economic and territorial development of the department. “That’s how it was put together.”
But this month the county sold a package in the district for $ 1.5 million to Shadowcast Partners. This company plans to build an electric freight truck distribution center.
While new tenants are expected to move in, the county this week set a cap of $ 500,000 on the excess tax increase. Any amount up to this amount will be used to repay the infrastructure loan. Anything above it will stay with the county, Brock said.
“We will cap all eligible excess tax increases to repay the infrastructure loan at $ 500,000,” Brock said. “That’s in case there’s a bargain in the neighborhood due to the lot sale we had recently at Shadowcast.”
The Tech District has a number of vacant lots, although the addition of Shadowcast partners may spark additional interest. The county is unlikely to use tax increases in a development district again to pay off a loan used to attract a business and the jobs it provides – an arrangement commissioners this week called outdated.
By capping excess tax increases, anything over $ 500,000 can now be applied to local needs, the county said.
“There was a time when you didn’t see a hiring sign everywhere and we needed good paying jobs in Missoula,” Commissioner Josh Slotnick said of the original deal. “With the cap, we can now use this money to carry out very good housing projects. “