City looks at funding for Haskill land deal

Is Whitefish willing to help fund the protection of Haskill Basin and the city’s source for drinking water through a tax?

That’s the question Whitefish City Council is hoping to answer in the coming months as it determines if and how the city might contribute to fundraising efforts to purchase a conservation easement on the 3,000 acres north of the city.

The project would permanently protect the working forestland in Haskill Basin through a proposed deal between The Trust for Public Land and F.H. Stoltze Land & Lumber Company. Nearly $8 million is still needed to complete the land deal.

Representatives from The Trust for Public Land presented the city Sept. 15 with a finance feasibility study that sets out possible ways the municipality can raise funds to contribute to the funding gap.

While council Monday made no formal decision on the matter, councilors did ask questions about the report and seemed to favor some type of funding mechanism to raise city dollars for the project.

“It’s really important that we preserve Second and Third creeks on Haskill Basin,” councilor Richard Hildner said, noting the potential pressure on water sources for the city in the future.

The TPL study sets out how the city could issue a general obligation bond, increase the resort tax, raise water rates or increase the property tax levy to generate funds. The city could use one funding method or could look at using a combination of methods.

“We look at this as a quilt of funding” Dee Frankfourth, with TPL, said. “It’s not going to come from any one source.”

Frankfourth recommended the council narrow the funding options to those that match the needs of the city and conduct a public opinion survey that would help determine whether to run a election for a property tax levy.

Council noted that public funds won’t make up the entire gap, but donations will also have to come from private sources.

“It works better in Whitefish to have a couple different types of funding,” councilor John Anderson said. “Public and private funding — it works better if everyone has a stake in something.”

Funding options

Council could adopt a resolution for a general obligation bond and submit the issue to city voters. The term of a bond is limited to 20 years. As an example, the TPL study, noted that a $3 million bond would cost the typical homeowner an average of $38 per year for the life of the bond.

Raising the resort tax from 2 to 3 percent is a second option, which would also have to be approved by voters. Increasing the tax to 3 percent would generate about $1 million annually. The city could then issue revenue bonds backed by a commitment of resort tax revenues.

The city could consider increasing water rates as a way to generate funds for the conservation easement. A 5 percent increase in rates would generate about $124,000 per year. Council would have to vote to approve a change in water rates.

The city can impose a new mill levy, if approved by voters. A 10 mill property tax levy would generate about $228,000 annually at a cost of $43 per year to the average homeowner in the city.

Some councilors did say holding any kind of ballot election should come sooner rather than later with spring 2015 suggested as the timeframe for holding a special election. The land deal has to be finalized by the end of 2015.

“I think if we wait until November [2015] that’s too long — if it fails, we only have 60 days until the option expires,” councilor Andy Fuery said.

Land deal

The overall purchase was expected to cost $20.6 million, but Stoltze agreed to contribute $4 million to the project, while the Forest Service is expected to provide a $7 million grant and a $2 million grant from the U.S. Fish and Wildlife Service is expected.

“The stars are completely aligned on this,” Alex Diekmann with TPL said. “There is generational changes in ownership happening at Stoltze, which has a long legacy of protecting this property. First and foremost now is protecting the city’s water rights.”

If the property were to be developed it could damage the watershed, which provides about 75 percent of the city’s water supply. The Trust for Public Land has secured an option to purchase the development rights from Stoltze through the end of 2015.

“We want to find a balance between recreation, water protection and habitat,” Diekmann added.

Public input

During public comment, John Krammer reminded council of several multimillion dollar fundraising efforts in town that are recently completed or are still underway.

“We have to succeed at this and we will,” Krammer said. “A lot of people in the community are paying off their pledges for the new food bank. There is a fundraising effort going on for the high school and there’s still fundraising going on for the Beaver Lake trail project. It’s very awkward to go out and ask the same people for money for different projects.”

Heidi Van Everan, executive director of the Whitefish Legacy Partners, said she supports the project.

“I’m thankful to Stoltze that they are open to this project,” she said. “What an amazing community to have this vision.”