Despite Smoke, Lodging Taxes Increased in 2017

Montana had a record year in bed-tax collections, with the Flathead seeing significant increases

By Molly Priddy
Shoppers in downtown Whitefish. Beacon File Photo

The Flathead Valley saw considerable increases in taxes collected on visitors’ lodging in 2017, and Montana as a whole had a record year.

According to the state Office of Tourism and Business Development, Montana lodging businesses saw an average increase of 5 percent from 2016 in the collection of lodging facility-use taxes.

The 4 percent tax is often referred to as the bed tax, and it helps pay for tourism promotion throughout the state.

Whitefish saw major increases in bed-tax collections over 2016, up 15 percent in 2017 with $1,110,081. Kalispell’s bed taxes increased by 6 percent in 2017 with $1,225,471.

Glacier Country, comprising the Northwest corner of the state, saw an 8 percent increase in 2017 in bed taxes.

Kalispell Convention and Visitors Bureau Director Diane Medler said her bureau was pleasantly surprised with the numbers from 2017, considering the severe wildfire season that burned through the latter end of the summer.

“It was busy, and we were surprised that the fires didn’t impact revenue in our occupancy more than it did,” Medler said.

Of particular note were the numbers from the third quarter last year, Medler said, which comprises July through September, when the fires were peaking. Despite the smoke, Kalispell bed taxes increased 10 percent in that period. Similarly, Whitefish’s third quarter had a 16 percent increase from the previous year.

Both cities have now seen a significant rebound from 2015, during which wildfires also obscured the skies and altered many travel plans. In 2015, Whitefish saw no increases in bed taxes from the previous year, and its third quarter was down 2 percent.

Kalispell’s 2015 was similarly lackluster, with bed taxes overall down 3 percent from the previous year and the third quarter down 9 percent.

In 2016, a relatively clear year for fires, Whitefish’s bed taxes increased by 16 percent, with its summer quarter up 26 percent. Kalispell also saw a bounce-back, up 4 percent in 2016 and up 8 percent specifically in the third quarter.

This year’s increases build on those rebounding numbers, and tourism across the state continues to boom. Preliminary data from the Institute for Tourism and Recreation Research shows that 12.2 million nonresident visitors spent $3.29 billion across the state in 2017, supporting 53,240 jobs. Glacier and Yellowstone national parks both saw major crowds, and were the biggest draws in the state for visitors.

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