Bigfork resort tax map hits another snag

By ALEX STRICKLAND / Bigfork Eagle

A map proposing a potential resort tax district for Bigfork was rejected by the Montana Department of Commerce last week, the second map submitted by a local committee that has not met state statute.

Cheryl Richmond, head of the Resort Tax Committee charged with shepherding a possible tax referendum through the bureaucratic process so it can come before voters, said the latest setback also came with plenty of feedback.

"It showed us where we need to be," she said.

Last Tuesday, Susan Ockert of the Department of Commerce met with the committee to explain why the map failed to meet regulations.

"It always helps to get face-to-face," Richmond said of the meeting. "She's not the enemy anymore."

Richmond said the main shortcoming of the proposed district map is that it includes too much "passive income," which is earned through investments, retirement funds, pensions or social security. In the group's attempt to include areas like Eagle Bend in the map, they roped in too much income that isn't being earned in the area, which disqualified the map.

Ockert explained that the district has to contain more working income than passive income, even if the former is only $1 more.

As a result, Richmond said whatever map the group does come up with will probably end up "looking like a spider" with tendrils reaching out to encompass things like the Eagle Bend Golf Course and Marina but foregoing the surrounding residential areas.

That, however, is a catch-22 in itself, according to Richmond, who said that one of the main reasons to include areas with many retired people is that were a resort tax to be instituted, it would require the services of a volunteer board to administer. Such a board would be time consuming, which could preclude some working people from joining. To serve on such a board, a person would have to reside inside the district.

Bigfork also finds itself in a peculiar bind because of the Village's status as an unincorporated community. When Whitefish passed its resort tax in 1995, a Montana law requiring towns to consider passive income in relation to working income was changed to only require that the Department of Commerce look at working income. The change, however, only affected incorporated towns, meaning Bigfork must still adhere to a law created before the economy in Western Montana made its shift towards recreation and retirement.

Richmond likened the statute to one she remembered as a child that outlawed driving at night in Montana unless someone was walking in front of the car with a lantern. "It doesn't make much sense anymore," she said.

For the resort tax committee, getting a map approved by the state is the first step in a process that would still include collecting signatures for a petition and — since getting on the November ballot is now impossible — getting Flathead County to approve and administer a special election so voters in the proposed district could decide whether to institute the tax.

Though no numbers are hard and fast yet, the resort tax committee would likely eye a 3 percent tax on "luxury goods" in the district. Funds from the tariff would be administered by a board and doled out to community projects. Such taxes have met with great success in other Montana communities like Whitefish and Big Sky. The communities of Craig and Seeley Lake are currently pursuing similar measures.

Consultants estimate that a Bigfork tax could raise somewhere between $500,000 and $700,000 per year.