Council votes to accept federal building, share renovation costs with Missoula County

The downtown Missoula federal building was built in phases between 1911 and 1938 in the Italian Renaissance Revival style and was listed on the National Historic Register in 1979.

With the opportunity at hand, the Missoula City Council on Wednesday placed its unanimous support behind plans to accept the downtown federal building from the government, while also approving a memorandum of understanding with the county regarding future cost and care of the facility.

As one city official put it, the historic building is in “good shape but tired.” Under the proposal, the city and county would split the cost of preparing the structure for public use, which is anticipated to cost each government around $20 million.

But John Adams, the city’s brownfields coordinator, said occupying the building would free up several downtown properties, which also have value and could be sold for redevelopment. Consolidating city and county government into one central service hub could also save funding in the longterm.

As it stands, Adams said, moving forward with the building’s acquisition and rehabilitation is the best solution at hand given the city and county’s dire need for additional room.

“Rehab would cost less than or the same than other space solutions,” Adams said. “It would house the entire county administrative center, and also the city’s entire downtown campus, except for the Missoula Police Department.”

The structure was built in phases between 1911 and 1938 in the Italian Renaissance Revival style and was listed on the National Historic Register in 1979. The city’s Downtown Master Plan supports acquisition of the building, which could house up to 400 city and county employees by the end of 2024.

Aside from saving a historic structure, the consolidation of employees lies at the heart of the plan. If the city chose a different option, Adams said, it would struggle to meet its spatial needs now and into the future.

Among the concerns, he said, the city’s population has doubled since City Hall was built. With that population growth, city government has grown to keep pace with public services. It currently pays around $180,000 a year to lease additional downtown office space.

The county is in the same position.

“At this point, doing nothing is not an option,” Adams said. “We’ve held city hall together with bailing wire and chewing gum, sent people to satellite offices and leased extra space. We’ve done everything we can as an institution without a major public investment.”

In 2034, Adams said, projections suggest 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.

Adams said that continuing the status quo and leasing additional space to meet current and future spatial needs will cost the city around $20 million through 2034. Renovating and expanding City Hall would cost $28 million, including the need for additional room for Municipal Court.

Other options being explored include 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.

That includes $30 million to get the building functional for services and around $10 million for historic preservation, which is required if Missoula agrees to accept the building from the National Park Service.

If Missoula passes on the opportunity, the federal government would place the building up for public auction, leaving its future uncertain.

“This is a remarkable and unique opportunity for us to not only meet the needs of the city and county over the long term, but also to provide convenience to the residents we serve,” said Missoula Mayor John Engen. “In the long run, we also end up saving a ton of money to support those services. We’re also preserving a pretty remarkable building that’s a downtown icon.”

Paying for the project could involve what city CAO Dale Bickell described as a “bucket of options.” This year’s budget process will likely include a capital improvement request that will lay out the city’s financial plans for the federal building.

Among the options, the city could also sell its other properties once it moves into the federal building, including City Hall and City Council chambers.

“Those are all assets that we currently own and contemplate being able to divest of for other development purposes,” Bickell said. “We have opinions of value on those being around $10 million between the two.”

Other opportunities include federal grants for environment abatement of the federal building. The city is also spending money on space now and would reclassify those expenses. Funding from the American Rescue Plan could also be allocated toward the building’s rehabilitation.

“We also have the opportunity to expand one of the downtown urban renewal districts. It’s a consideration the city council could make,” Bickell said. “We also have the ability to issue bonds to do this. It’s limited on how much we could issue bonds for, but it could be a portion of this as well.”

Consolidating city and county government would also increase collaboration across a number of fields while providing more convenience to the public. The council supported the opportunity to take the building for free under the Good Neighbor Program.

Other steps will follow.

“We need to walk the talk and do that with our own facilities,” said council member Bryan von Lossberg. “This is an elegant solution for the city and county and it’s a prudent financial move. There’s costs associated with any path we take moving forward. It’s pretty clear this is the fiscally prudent move.”