The public will have a chance to share their thoughts on a proposed tax abatement Tuesday evening.

The new Montana Egg LLC facility at 38th Street North near the intersection with River Drive. The company is requesting a tax abatement on the recently opened facility and City Commissioners are holding a public hearing Tuesday.

Montana Egg LLC seeking city tax abatement

The abatement would total $305,620 over 10 years and those funds would not go to the city’s general fund. Once the abatement ends, Montana Egg would resume paying full taxes on the improvements at the property.

Staff wrote in their agenda report that they are recommending approval, as they have for a number of abatement requests since it can be an economic development tool. But the caution that the decision requires more discussion.

“Careful consideration must be given to the checks and balances of incentivizing business expansion at the expense of identified budgetary needs, especially as it pertains to high priority public safety needs,” staff write in their report. “Consideration of these factors, along with the specific guiding questions from Resolution 10119 regarding tax abatements, require a higher level of discussion about whether or not the benefit to Montana Egg outweighs the potential adverse effects to the community.”

Resolution 10119 was adopted by the commission in December 2015 and established certain criteria for the evaluation of tax benefit requests. In the staff report, the criteria are listed and include responses from city planning staff.

If the commission approves the tax abatement, the action only affects city taxes. It will not affect school district, county or state taxes.

In 1985, the state law changed and requires that each local governing body, the city and county, may approve tax abatements on a project by project basis. If one local government body approves the tax benefit and the other does not, the benefit will apply only to the mills levied by the approving body. Tax benefits do not include any relief from state-wide levies and local government approval of the application must be made by resolution.