In theory, if the part-time residents left all at once, Flathead County’s population would plummet 11 percent. That’s according to numbers compiled by the Montana Department of Revenue in 2006 that measure the number of nonresident homeowners using property tax mailings.
Flathead County easily topped the list with 3,745, or 11 percent, of its dwelling units owned by someone with an out-of-state mailing address, followed by Gallatin County. Lake County placed fifth.
The numbers are imperfect – they don’t factor in those taxpayers who do their accounting out of state and Bigfork real estate broker Rick Brunette said that tally seems low. Yet it still confirms what many here already assume: This area is flush with seasonal residents.
“I’m not surprised by (that ranking) at all,” County Commissioner Gary Hall said.
The glut of seasonal homeowners presents its own package of benefits and drawbacks – schools rely on their money, and the arts on their generosity, yet communities can feel pinched when their temporary neighbors pack their bags and pocketbooks and go home for the season. It’s a tricky balance.
Hall would know. He once owned a restaurant and bed and breakfast. When the “shoulder seasons” arrived, tourists and part-timers joined in the exodus.
“I don’t think there is anything you can do except prepare for it,” Hall said, adding that businesses should enjoy the peak seasons and be sure to cater to locals to weather those shoulder seasons.
The most obvious benefit of the Flathead’s seasonal population comes from the property taxes they pay, which Mary Craigle, tax policy analyst with the state department of revenue, reminded “aren’t prorated.” Part-timers pay just as much as full-timers, thus supporting services and schools they rarely use. But as more people buy vacation homes in Montana counties renowned for their scenery and recreation opportunities, the relationship between part- and full-timers has hit minor speed bumps. How communities grow is, on its face, controversial.
A few years back, in the town of Big Sky, locals decried a proposed law that would have allowed nonresident property owners to vote in some local elections. It failed to pass after residents there lobbied lawmakers. In the most recent session, as legislators debated property tax relief, bills deemed to benefit part-timers often came under criticism.
Rep. Mike Jopek, D-Whitefish, took aim at House Bill 315, which would have capped the state’s ending surplus at $50 million and used the money left over to provide property tax relief by cutting school mill levies. At the time, Jopek said the bill, which eventually died, would have provided massive tax cuts to out-of-state mansion owners in the Flathead Valley.
He referred to Montana Department of Revenue documents that show taxes nonresident homeowners pay in Whitefish provide almost 40 percent of all public school funding there.
Jopek, in a recent interview, lauded the Flathead Valley’s nonresident homeowners for their generous donations to local causes, such as theaters and libraries. But in a town where many locals can’t afford a home anymore, Jopek said, “I think we need to look at that tax structure, make sure it works first and foremost for Montanans. Out-of-state landowners are great neighbors, but they don’t pay income tax.”
Whether income, instead of property taxes, will become a central issue in the next Legislature is uncertain. What’s agreed upon is that much of Flathead Valley’s healthy economy is owed to seasonal homeowners.
One obvious beneficiary is real estate. Brunette estimated that 50 percent of his sellers and 85 percent of his buyers are nonresidents. “Many countries base their economies on trade,” he said. “Is more trade going out or coming in? So, I think, we’re sitting pretty well.”
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