Residents weigh in on resort tax at lively hearing

City leaders heard the pros and cons from the public on a proposed 3% resort tax at a public hearing last week.

With a rare full house in council chambers, some folks were adamantly opposed to the tax, others fully supported it, and some even changed their minds after hearing the details.

The longest part of the hearing was the question-and-answer session on the tax, where Mayor Don Barnhart and city manager Susan Nicosia cleared up some misconceptions on the tax.

For example, city resident Andrea Getts had concerns the tax would apply to online purchases. But Nicosia said the tax only applies to purchases physically made in the city.

“It makes a lot more sense now,” Getts said. “I’m cautiously in favor of this.”

The city is proposing the tax as a way to pay for emergency services and infrastructure. It’s estimated that in the first year, the tax will, conservatively, raise about $450,000. Fifty-five percent of that, or $247,500 will go to public safety, as the city will look to add two full-time firemen to its staff. Twenty-five percent, or an estimated $112,500 will go toward a property tax rebate to city property owners. The remainder would go toward infrastructure, like city streets and parks, 5% back to businesses to administer the tax and 1% to the city for administration as well.

The alternative is a public safety levy.

A $450,000 levy, if it were to pass, would raise the average home’s tax bill in the city a whopping 28%, the city estimates. That amounts to a tax hike of about $81 for every $100,000 of residential assessment. So a home assessed at $250,000 could potentially pay $200 more a year.

The resort tax, on the other hand, would at least capture tourist dollars, while offering a tax rebate to the average homeowner, at least initially, of roughly $50.

The resort tax, if approved, would run for 20 years.

Of those that opposed the tax, roughly half were from out of the city limits, but they shopped here. One Columbia Heights resident said he opposed the rebate, because while he would end up paying the tax, he wouldn’t get the rebate.

That brought a response from councilman Doug Karper.

“But I’m paying $2,500 (in city taxes) that you’re not,” he said. “I don’t need more taxes. But we need this.”

The crux of the problem is that as the city sees an influx of new homes and development, plus an influx of tourists every summer, the number of fire department calls has gone up. Last year firefighters went to well over 300 calls, a number that’s doubled since 1999 and is up 312 percent since 1979.

The biggest problem with volunteers is that during daytime hours, most people are working, and they can’t necessarily respond to calls.

“We’re trying to get expanded emergency services and have someone else (tourists) pay for it,” Barnhart explained to the crowd.

But still, several folks remained unconvinced a resort tax was the way to go. One man railed against the tax saying it would add thousands onto the purchase of a vehicle.

Not so, city leaders noted — car sales are exempt.

Others said they would never shop in Columbia Falls again if it passed.

That brought the ire of another resident, who said people shouldn’t look at it that way — there was no sense in punishing businesses for the tax.

In fact, most of the items that will be taxed are something a visitor would use.

For example, the tax would exempt clothing, unless it has a Glacier Park or other logo on it geared toward tourists. The tax does, however, target alcohol, restaurant meals and beverages, as well as candy.

A couple of folks suggested the city only implement the tax from April to November. The city said they looked at that, but businesses didn’t want the hassle of having to turn the tax on and off in their registers and accounting software.

The council took no action on the matter, but the expectation is that it will be put in front of voters in June, by a mail-in ballot. Only city residents will have a vote on the matter.