Yellowstone County offers rich bait to lure Bresnan to Billings

Hoping to hit an economic development grand slam, Yellowstone County officials are assembling a $1.62 million financing package to land a network operations center for Bresnan Communications.

By TOM HOWARD
Of The Gazette Staff

Bresnan, the digital communications company that took over AT&T Broadband’s cable TV service, announced plans to locate an operations center in Montana, resulting in nearly 100 new jobs. Since then the company has been looking at several Montana sites, including Billings and Butte. But to date, no decisions have been announced.

The financial package approved Thursday by the Big Sky Economic Development Authority’s board of directors is designed to compete with a reported $1 million financing package being offered by Butte.

Evan Barrett, executive director of the Butte Local Development Corp., said he could neither confirm nor deny what Butte is offering to Bresnan.

"It would be inappropriate to discuss in a public arena any dealings we have with Bresnan," Barrett said Thursday. Barrett said only that Butte officials have discussed a Butte location for Bresnan.

Joe McClure, executive director of Big Sky EDA, said the package approved Thursday includes financial incentives available through Yellowstone County and Big Sky EDA. The package also includes a pending $500,000 federal appropriation requested by Sen. Conrad Burns, R-Mont. A bill carrying the appropriation for the Big Sky EDA recently passed the Veterans Administration-HUD subcommittee in the Senate.

The financing package could also include up to $300,000 in private capital contributed by the Big Sky Economic Development Corp., a recent Big Sky EDA offshoot that raises private capital for business investment.

McClure noted that the Big Sky EDC’s board of directors hasn’t yet committed to the Bresnan financing package, although some EDC board members favor it.

During Tuesday’s discussion, some Big Sky EDA board members expressed reservations about the deal. "This is pretty steep," Tom Emerling said.

Others on the board said it makes sense to focus on the Bresnan deal, in light of a study that shows significant economic benefits for the community.

"These are the kind of jobs we want in the community," said board member Michael Gulledge.

Billings’ pitch to Bresnan: The details

Here is an overview of the financial incentive package being offered to bring a new Bresnan Communications operations center to Billings.

– Yellowstone County property tax abatement program, $19,000 per year for 10 years: $190,000

– Big Sky EDA Interest Rate buy-down program: $210,000

– Big Sky Economic Development Authority, $30,000 per year for 10 years: $300,000

– Big Sky Economic Development Corp., tentative $30,000 in private financing for 10 years: $300,000

– Big Sky EDA Business Incentive Fund: $120,000

– Tentative federal appropriation: $500,000

Total: $1.62 million.

"This is a difficult call if you put all of our resources into attracting one company," County Commissioner Jim Reno said after Thursday’s meeting. "Personally, I would diversify our efforts and try to bring in some singles and doubles instead of just going for a home run." On the other hand, Reno said he’s glad that the financing package would include a mixture of private capital and taxpayer dollars.

According to a study by Scott Rickard of the Center for Applied Economic Research at Montana State University-Billings, Bresnan’s operations center could employ 89 people with a total annual payroll of nearly $4 million by 2006.

Most of the positions would be for call-center staff who would be paid a relatively modest $25,000 per year. But about one-third of the positions would pay more than $70,000 per year, Rickard said.

The study also estimates that the operations center would spin off one additional new job for each job Bresnan brings to town. Over 10 years, the center would generate an additional $65.6 million in new wages and an additional $2 million in taxes for Billings and Yellowstone County. Construction of a proposed $4.5 million operations center would also support 29 construction jobs and generate $1 million in wages, Rickard said.

Big Sky EDA officials said the proposed financing package is aimed at bringing the Bresnan center to Billings. They conceded that Montana would benefit from the Bresnan jobs whether the center is located in Butte or Billings.

Representatives of Burns and Rep. Denny Rehberg, R-Mont., attended Thursday’s meeting. Todd Capser, state director for Burns, and Randy Vogel, Rehberg’s representative, emphasized that they can’t show favoritism for one community over the other. Big Sky EDA board members agreed that Montana would benefit whether the jobs go to Butte or to Billings.

Capser said it’s also too soon to tell whether Burns’ appropriations request will remain at $500,000. He said Burns requested the money specifically for the Big Sky EDA, and the request was made before Butte’s interest in the project was known. If Bresnan opts for Butte instead of Billings, it’s possible that the federal appropriation could be transferred to Butte. But that would have to be resolved in conference committee, Capser said.

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Butte unhappy offer from Billings to Bresnan revealed

By LESLIE McCARTNEY
Montana Standard

While acknowledging that the county would be thrilled to land the state nerve center for Bresnan Communications, Butte-Silver Bow officials were dismayed to find the news of the county’s interest — and its incentive package — aired in Billings last week.

"It is totally inappropriate to discuss the details until the time they accept the deal. … Nobody likes to see their discussions in a public arena," said Butte Local Development Corp. Executive Director Evan Barrett.

Barrett added that while the public Big Sky Economic Development Authority board talked about its proposal for Bresnan — the Yellowstone County board said it was assembled to compete with a reported $1 million offer from Butte — that policy does not extend to Butte’s dealing with Bresnan. Barrett said keeping details under cover until the appropriate time is key to negotiations when dealing with interested companies.

"Our policy is to keep our powder dry until such time as the company accepts the deal," Barrett said.

Bresnan, the digital communications company that took over AT&T Broadband’s cable TV service, has announced plans to locate an operations center in Montana, resulting in nearly 100 new jobs and an annual payroll of about $4 million. Since then, the company has been looking at several Montana sites, including Billings and Butte. But to date, no decisions have been announced.

The Big Sky EDA is pressing ahead with its $1.62 million courting of publicity-shy Bresnan with a mixture of tax incentives and financing.

However, Butte officials remain hopeful.

"We’re trying our darndest, we want them to come here but until we hear something concrete, there’s nothing we can do," said Butte-Silver Bow Chief Executive Judy Jacobson.

While declining specifics of a package extended to Bresnan, Jacobson explained that the county has several avenues for funding such a venture. Hard Rock Mining money, for example, can be used for economic development. Also, since Bresnan would be located in the Uptown — the Hennessy building has been mentioned several times since that building will soon be emptied of Touch America — it is possible that Urban Revitalization Agency funding could help.

Bresnan representatives have reportedly toured that building to determine whether it would fit their needs. Currently, the Hennessy building, as part of the Touch America bankruptcy hearing, is under the supervision of a bankruptcy judge in Delaware.

Also available are funding for training and packages put together with state help, such as using state programs. For example, to help jump-start mining at Montana Resources, the county obtained funding through the Board of Investments to help pay for new transformers at the site.

"There’s a number of tools you can use," Jacobson said.

Butte-Silver Bow Economic Development official Kathy Fasso downplayed any notion of competition between Billings and Butte, saying that Bresnan is weighing the offers and will make its decision based on what is a good fit for that New York-based company.

"I don’t believe they are pitting one city against the other," Fasso said. "There are two good proposals and they are weighing the options on both the give them consideration."

Efforts to contact Bresnan for comment were unsuccessful Monday.

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