MISSOULA - In hopes of acquiring the downtown Federal Building from the government free of charge, the city and county of Missoula this week formalized an agreement guiding the division of costs, operation and maintenance, among other things.
The agreement forms a Special District — a move permitted by state law to create a single ownership entity. Under its own rules, the General Services Administration cannot release the building to multiple owners, but only a single owner.
“We're going to use it to create an ownership mechanism. It won't encompass any properties, other than the 200 East Broadway property, and it won't be able to levy any assessments on any property owners other than itself,” John Adams, the city's brownfields administrator, said of the Special District. “It's just a way to create a single entity that can cache the building.”
Last June, the Missoula City Council placed its unanimous support behind plans to accept the historic property, and the county did the same. Both local governments are grappling with spatial needs that will only grow more acute in the years ahead and accepting, renovating and occupying the federal building carried the lowest cost of the other alternatives.
“We'll receive the building from the federal government at no cost and in return, we'll be bound to preserve the historic character of the building in perpetuity,” Adams said. “After acquisition, the city and county will rehabilitate the building and make it into the administrative and public services hub of the two entities.”
The agreement signed by the city and county also details their new partnership, which includes a 50-50 cost share, a division of ongoing maintenance and how the Special District would be dissolved if either government chose to do so.
“The cost to renovate the federal building and preserve a historic asset and renovate it for our current needs is likely less than the alternatives,” said Mayor Jordan Hess. “It's an opportunity to preserve a piece of history and make a space for local government that meets our needs.”
A city report released last year suggested that by 2034, City Hall will require 55,000 square feet to deliver all public services, and the county will need the same. Add them up and the federal building offers room to consolidate both governments, and it could be delivered for less than other options.
According to the report, continuing the status quo and leasing additional space downtown to meet current and future needs would cost the city around $20 million through 2034, and its needs for more room would not have been met. Renovating and expanding City Hall would cost $28 million, including room for Municipal Court, but that doesn't help the county.
Other options explored included building a new City Hall and county administrative building, which would cost the city around $31 million alone. Rehabilitating the federal building would cost $40 million in all, but it would be split 50-50 between the city and county.
Engineers over the past year have deemed the building structurally sound and due diligence hasn't revealed any major concerns.
“We've gone through the first phase of due diligence around this building, and we're still trying to garner some information from our partners at GSA around some of that,” said Chris Lounsbury, the county's CAO. “We have begun some of the programming piece, looking at what departments the city and county share that would be good fits together to help centralize those services.”
Lounsbury added that it's likely the government would transfer ownership of the building this calendar year, or early next year. Creating the Special District won the approval of commissioners on Tuesday.
“This building has sat vacant for many years in the heart of Missoula,” said Commissioner Dave Strohmaier. “This really is a once-in-a-lifetime opportunity to put this facility back into use and public service with the city and county working as partners.”
Of both local governments, only one elected official has opposed the idea.
“Yes, we do need the additional space and yes, we're going to acquire it with no additional costs to us. But it's going to cost over $40 million to remodel,” said City Council member Sandra Vasecka. “I don't think we should spend our hard-earned tax dollars on it. Yes, we might lose it, and we might have to find another property, but I think we need to postpone this project.”
Vasecka also expressed concerns over parking, even though the Downtown Master Plan doesn't require a business to provide parking in the downtown core.
But Adams said changes to the streetscape around the property may have to be addressed to provide such things as handicap parking and quick access. Other than that, employees working at the facility would be responsible for their own parking needs.
“We expect that just as we don't require downtown businesses to provide parking, we won't provide parking to employees. It's counter to what we'd hope for out of the Downtown Master Plan,” Adams said. "We have a system now where all the employees who would be moving to the Federal Building are required to park themselves or take transit. The situation worked reasonably well when there were 400 Forest Service employees there and weren't provided parking.”
