Next week, the fast-growing city of Columbia Falls will start collecting much needed revenues from a voter-approved Resort Tax that seeks to improve local infrastructure and provide substantial property tax relief. City officials estimate that the two-decades running initiative, which passed with 53% approval, will soon generate annual revenues of nearly $500,000.
“The fundamental idea behind resort taxes is to allow places with high numbers of visitors, but relatively few residents, to manage the wear-and-tear on local infrastructure without overburdening local citizens,” according to the Montana Department of Revenue.
Columbia Falls joins tourism destinations like Whitefish, West Yellowstone, Big Sky, Red Lodge, Virginia City, Cooke City, Craig, Gardiner, St. Regis and Wolf Creek to rebuild hammered infrastructure and provide property tax relief.
Earlier this year, Polson voters rejected their tourism tax by 64% of ballots cast despite the fact that 17% of the funds would have been used to reduce property taxes. Given Polson’s very sudden and explosive growth, due in large part to an influx of migrating Americans combined with Montana’s refusal to mitigate cyclical property tax reappraisals, voters won’t like their ever-increasing and pending property tax bills.
Some six years ago, Whitefish voters overwhelming – with a resounding 84% approval – voted to increase the local tourism tax from 2% to 3% and allocated 70% of the new revenues toward clean water conservation, 25% toward property tax relief, and 5 percent to the merchants who collect the revenues.
Early on, as Whitefish first enacted a tourism tax, it was visionaries like Councilor Andy Feury – who’s currently running for reelection – who worked on behalf of city citizens to get the Montana Legislature to allow tourists to help pay for the wear on local infrastructure like streets.
Back then, in 1995, Whitefish voters approved the tourism tax with 56% voting in favor. Nearly a decade later 76% voted to extend the infrastructure and property relief tax through January 2025.
Over the past 14 years as Whitefish grew up, tourists have lowered the average property owner’s tax bill by 17%. Since day one, that’s nearly $16 million that tourists put into property owners’ pockets for property tax relief.
Tourists have also helped keep Whitefish streets in good repair by contributing nearly $29 million to rebuild our streets. Tourist improved parks across town by contributing over $2 million and helped conserve the municipal water supply with nearly $6 million in resort taxes.
Since Whitefish voters enacted the Resort Tax, the million plus annual tourists that visit have helped reduce the average mill levy for the city portion of local property tax bills by over a whopping 23%.
If renewed by local voters on Nov. 2, via mail-in ballots that arrive by mid-October, tourists will continue to contribute over $4 million annually into Whitefish via the Resort Tax.
Twenty-five percent of the funds collected is for property tax relief, 58% would be used for street improvements and public works, 10% to improve and maintain parks and bike paths, 2% to help maintain the hugely popular and city-owned Whitefish Trail, and 5% for the businesses who collect the taxes from luxury purchases.
This is a good deal Whitefish. If voters do not renew the tourism tax soon, Whitefish will grow too large to qualify for resort status. Kalispell has unsuccessfully tried to lobby the Montana Legislature to change the population threshold for decades with zero success whatsoever.
Only voters can reenact Whitefish’s local tourism tax, which would stay in effect over the next couple decades. For those who wish to quibble that locals also pay the tax, that’s true, yet there’s millions of tourists and only thousands locals to help pay the bills. The tourists are here. They might as well help pay the ever-increasing, never-ending tax and infrastructure bills.