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Resort tax back on the table in Polson

by SCOT HEISEL
Lake County Leader | September 17, 2020 12:30 AM

The Polson City Commission on Sept. 9 unanimously approved a resolution to send a 20-year, 3% resort tax on a specific set of goods and services to a public vote during a special election in late January. Money raised by such a tax would largely be devoted to street repairs. In 2009, voters overwhelmingly rejected a resort-tax measure placed on the ballot, and the City Commission denied a plan to bring the issue to a vote in 2016.

Polson’s Economic Development Council recommended the tax, with most of the revenue — 80 percent — going toward city street maintenance and improvements, while 17 percent would be returned to city residents through a property tax rebate. The remaining 3 percent would cover administrative fees associated with the tax.

A resort tax is only an option for resort towns — defined as an incorporated city with a population of less than 5,500 residents with tourism making up a significant portion of the town’s economic base. The 2010 census listed Polson’s population at 4,488.

During an Aug. 24 public hearing, City Finance Director Cindy Dooley noted a resort tax, “allows communities like ours that have high numbers of visitors but relatively few residents to manage the wear and tear on our local infrastructure without overburdening the local residents.”

According to a 2018 report from the University of Montana Institute for Tourism and Recreation Research, nonresident traveler spending was $30,302,000 for Lake County in 2018. Lake County bed tax collections in 2019 were $355,002, up 18 percent over the previous fiscal year.

Based on lodging alone, Dooley estimated that Polson could raise $213,000 annually through a 3 percent tax.

“I’m not one that’s typically for a tax,” Ward 2 Commissioner Tony Isbell said prior to the Sept. 9 vote. “With all the options that we have to improve the streets … I am in support of this one.”

Ward 1 Commissioner Jan Howlett stressed the importance of getting Polson’s streets repaired.

“Somebody’s going to fall into a hole on one of our streets,” leading to a lawsuit, Howlett said. “I don’t want that to happen. I don’t want to see that. Polson needs sidewalks and good streets.”

“It’s a way for everyone to help,” Ward 1 Commissioner Lou Marchello said. “I think it’s a very fair and equitable tax.”

Mayor Paul Briney recounted his time serving on the EDC prior to running for mayor.

“I initially got on that committee with a negative attitude toward this. I thought, ‘This money is all going into the general fund, and then what?

“This is different. This money is allocated to street improvement, and that’s the No. 1 thing in the strategic plan that we wanted.”

Ward 2 Commissioner Bob Martin said regardless of commissioners’ opinions, he felt a public vote was necessary.

“I believe this is something the citizens of Polson should vote on rather than us killing it in a session of the City Commission,” which happened previously in 2016. “This, in my view, is the best way to accumulate money to fix our streets.”

Wednesday’s meeting wrapped up with Martin’s official resignation from the commission, effective immediately. Martin is moving to Swan Lake and will no longer be eligible to serve on the commission, which he joined in July 2017.

The commission will soon begin accepting applications from Ward 2 residents and will appoint a replacement to serve the remainder of Martin’s term, which ends Dec. 31, 2021.