BEFORE THE DEPARTMENT OF COMMERCE
OF THE STATE OF MONTANA
In the matter of the amendment of ARM 8.94.3101 and 8.94.3102 pertaining to the administration of the Montana Historic Preservation Grant (MHPG) Program
NOTICE OF AMENDMENT
TO: All Concerned Persons
1. On October 22, 2021, the Department of Commerce published MAR Notice No. 8-94-191 pertaining to the public hearing on the proposed amendment of the above-stated rules at page 1357 of the 2021 Montana Administrative Register, Issue Number 20.
2 The department has amended the above-stated rules as proposed.
3. The department has thoroughly considered the comments and testimony received. A summary of the comments received and the department's responses are as follows:
COMMENT NO. 1: Comments were received by the department to reconsider the requirement that funds are distributed on a reimbursement basis since small museums lack the capital to begin a project that may take months until the amount is reimbursed.
RESPONSE NO. 1: Program grants will not require funds up front before payment is made, and grant recipients are not required to pay out of their own funds for invoices and then wait for reimbursement. Grantees receive notice of award before beginning a project. After executing a contract with the department and following proper procurement procedures, a grantee can begin work on the project. Once an invoice is received for work completed, the grantee can immediately submit that invoice along with draw forms. Grantees would not pay any funds out of pocket at this time in the process. Department staff would promptly process the draw in 7 to 10 business days. Most invoices are required to be paid within 30 days, and funds would be in the grantee's account with time to pay the contractor. This process pays for work as it is completed but does not require the grantee to provide the amount of the MHPG award upfront. Projects will have multiple draw requests, depending on the project size, timeline, and budget. While we do request time to process such draws, the department recognizes the need to expedite such requests as quickly as possible. The department will be in regular communication with each grantee and/or administrator throughout the start-up process, draw requests, and close-out process.
COMMENT NO. 2: Comments were received requesting the program to offer grants to small museums for operational costs.
RESPONSE NO. 2: SB 338 established specific criteria and requirements for the MHPG program, which are listed in 22-3-1306, MCA, and must be used as the basis for these guidelines. Operating expenses were not listed in the bill and would represent a departure from the legislature's guidance so are therefore not listed as an eligible expense.
For projects over $50,000, applicants are eligible to include 10% of the funds requested toward the administration of the project, meaning a smaller museum could obtain funds that address facility needs and obtain project administrative support. This is especially important to allow applicants to overcome limited capacity in administering a grant that may require additional staff time to process and oversee the grant through the duration of a project.
COMMENT NO. 3: Comments were received to consider limiting funds that go to for-profit entities and developer/construction companies that are not education or community focused.
RESPONSE NO. 3: The guidelines aim to meet the requirements of the legislation in making both public and private entities eligible for grant funding. See 22-3-1306(1), MCA. The guidelines further aim to provide flexibility to a wide array of project types in diverse areas of Montana. In the 2021 Legislative Session, of 26 grants awarded, 75% of grantees were non-profit or local governments, 50% were history museums or historical societies, 20% were for-profit local historic preservation efforts. No developers or construction companies received funding. All applicants must address the criteria set forth in 22-3-1306, MCA, including need for funding and the overall historic value of a project to Montana or the community.
COMMENT NO. 4: Comments were received asking if the department has the authority to divide the funding pool into separate categories for private businesses and nonprofits, creating a program for historic preservation projects and a smaller grant opportunity with a simpler application process.
RESPONSE NO. 4: The department may change the design of the program but must be guided by and include the requirements and structure created in 22-3-1305 through 22-3-1307, MCA. The legislature may consider the agency recommendations, but, ultimately, may select projects regardless of review or ranking. State funds are subject to all applicable state laws and requirements.
COMMENT NO. 5: A comment was received asking if a nonprofit museum can get funding for renovation or repair of a purpose-built building distinct from a historic structure or a modern building converted to museum use and if housing a history museum "designates historic significance" for a structure.
RESPONSE NO. 5: Yes. Section 22-3-1306, MCA notes history museums, historical societies, and historic sites specifically as part of the MHPG program and all are eligible for funding—new construction, rehabilitation of a modern building, historic preservation, or other needs such as climate control and security or other improvements such as lighting, display casing, shelving, and storage materials. A history museum or historical society can apply regardless of the building they are housed within. A historic site can only apply if (1) the structure or site is listed on National, State, or Local Historic Registry, (2) the structure or site contributes to a historic district, or (3) the structure is more than 50 years old and has documented significance to the history of a Montana community or region. Ultimately, the legislature decides which projects are funded.
COMMENT NO. 6: A comment was received asking if the department has authority to add interpretive and internship funding to eligible program uses.
RESPONSE NO. 6: The department creates the competitive criteria for the MHPG program, which must be guided by and include the requirements outlined in 22-3-1305 through 22-3-1307, MCA. The criteria in 22-3-1306, MCA includes projects that stimulate the economy, improve physical structures (e.g., enhance security, address building code issues), and add historic value to the state. The list does not reference or relate to interpretive elements or internships and are therefore not listed as eligible expenses.
/s/ Amy Barnes /s/ Adam Schafer
Amy Barnes Adam Schafer
Rule Reviewer Deputy Director
Department of Commerce
Certified to the Secretary of State November 30, 2021.