The owners of Nelson Hardware are asking the Whitefish City Council to commit $100,000 in tax-increment funding to demolish the former Army-Navy store on U.S. 93 South and make site improvements as the business owners proceed with plans to relocate from downtown Whitefish.

The iconic hardware store has been a popular downtown retailer for 70 years, but has outgrown its space and lost a lease on a warehouse behind the store that is crucial for the business’ operation.

Nelson Hardware Vice President Marilyn Nelson recently told the Daily Inter Lake the decision to relocate is driven by a desire to ensure the sustainability of the business into the future.

Nelson Hardware is under contract to purchase the Army-Navy building that has been vacant for years and has fallen into disrepair, according to a letter sent to the city by Marilyn Nelson.

“After examining the existing building, we have determined that it needs to be demolished,” she said. “Not only has it fallen into disrepair, but it is too close to Commerce Street.”

The business owners propose to dedicate additional property for the expansion of the city right of way and minor improvements to the existing streets on the north and south sides of the Army-Navy site. They propose to provide 10 feet of additional right of way on the south side of 18th Street and an additional five feet of right of way on the north side of Commerce Street.

Nelson Hardware also would landscape a 40-foot section next to U.S. 93 that would be used for storm-water detention.

Site preparation costs will total $444,435, according to an estimate from Saurey Custom Builders. That estimate includes the demolition at $49,600, landscaping at $76,752 and a storm-drain system at an estimated $42,000.

“The site has been an eyesore along the highway and stagnant on the market since 2008,” Nelson stated in her letter. “We see our project as an opportunity to breathe new life into this location. Funding from the TIF would help us make this vision a reality.”

City Manager Adam Hammatt noted in his report to the council that the Nelsons’ request “puts us in a position to address blight in this area.

“I believe this request to be reasonable,” Hammatt said in his report. “This is an area where we have desired change for some time, it meets the requirements for the use of tax-increment finance funds, it eliminates blight and hopefully will be a catalyst for further improvements in this area.”

Tax-increment financing is a revenue tool that allows a local government or redevelopment authority to generate money to clean up blighted properties targeted for improvement. The Montana Legislature authorized tax-increment finance districts in 1974. Whitefish in 1987 took the unusual step of including most of the city in its tax-increment district.

Any increase in taxes within the tax-increment finance district goes into a tax-increment fund, and is used for projects to improve the value of property within the district.

The City Council will make a decision on the Nelsons’ request at its meeting on Monday, May 21, at 7:10 p.m. in Whitefish City Hall.

Features Editor Lynnette Hintze may be reached at 758-4421 or lhintze@dailyinterlake.com.