WHITEFISH – In a watershed victory for conservation advocates and city officials who saw the need to permanently protect Whitefish’s municipal water supply while preserving recreational access to a 3,000-acre tract of land, voters overwhelmingly approved a 1 percentage point resort tax increase that will help finance the purchase of a conservation easement in Haskill Basin.
Results of the special election were tallied Tuesday night, with 1,718 voting in favor and 335 against. The 83.6 percent approval means the revenues generated through Jan. 31, 2025 – the date when the existing resort tax expires and goes back to Whitefish residents for a vote – will be used to fund the remaining $8 million needed for the conservation easement. Twenty-five percent of the increase will be rebated to taxpayers in a similar fashion to how the current percentage works.
The city’s resort tax on lodging, restaurant food and drinks and retail items will increase from 2 percent to 3 percent.
The Whitefish City Council voted in favor of holding the special election in an effort to secure additional funding sources to help acquire a conservation easement on prime land owned by the F.H. Stoltze Land and Lumber Co. and located beside Whitefish Mountain Resort on Big Mountain, a tract of land vulnerable to pressures of development and the source of 75 percent of the municipal water supply in Whitefish.
If Whitefish were to lose access to Haskill Basin water, it would force the alternative of pumping and treating water from Whitefish Lake, costing an additional $500,000 annually, according to Whitefish Mayor John Muhlfeld.
Stoltze values the land at $20.6 million, but the company has offered to sell it for $17 million, according to Alex Diekmann, project manager for the Trust for Public Land, which is the nonprofit organization working to raise money from federal programs, private donors and public funding sources in order to bring the deal to fruition.
Earlier this year, the project received a funding boost from the U.S. Forest Service, which ranks such projects for funding through its Forest Legacy Program, awarding grants to states to purchase permanent conservation easements.
The agency has given the Haskill Basin Watershed Project its No. 1 spot, positioning it to receive $7 million in Legacy Project funding. An additional $2 million will come from the U.S. Fish and Wildlife Service’s Habitat Conservation Plan Land Acquisition Program. Together, the grants give the project significant purchase toward raising the $17 million needed to buy the development rights from Stoltze by the end of 2015, leaving a balance of about $8 million.
Muhlfeld said the council’s reasoning in selecting the resort tax increase, as opposed to alternate funding mechanisms like an uptick in water rates, was that it was more equitable to distribute the financial burden through a resort tax increase affecting the half-million visitors Whitefish draws annually than placing the millstone on the backs of 5,200 households.
Whitefish’s resort tax has raised $25.8 million in the past two decades, with tax revenue increasing at an average of 6 percent each year. Muhlfeld said 75 percent of resort tax collections are used for street projects, 25 percent is rebated to property owners, 5 percent is set aside for park improvements, and the remaining 5 percent helps administer the tax.