Flathead County may grant tax break

By LYNNETTE HINTZE/The Daily Inter Lake

The county commissioners Thursday agreed to consider a tax break for the Going to the Sun Fiber Mill near Kalispell.

Fiber-mill owners Scott and Diana Blair owe $2,182 in delinquent taxes on the business and likely qualify for an incentive program that gives tax breaks over a 10-year period.

The Blairs first must complete an application process before the commissioners can make a final decision.

"The taxpayer typically comes to the commissioners before starting an industry," said Scott Williams, regional manager of the state Department of Revenue Property Assessment Division.

"But nothing in the law says you can't do it after the fact."

If the commissioners approve the tax break, it could be applied retroactively.

The law allows improvements to property to be taxed at 50 percent of their taxable value for the first five years. Each year after that, for as many as 10 years, the percentage of taxes the property owner must pay increases until the full taxable value is attained in the tenth year.

The Blairs started the business two years ago with loans through the state Growth Through Agriculture Program and the federal Small Business Administration. They purchased specialized equipment to process sheep wool, mohair, alpaca, llama, yak and cashmere from the raw state to a finished marketable yarn.

"We've helped many of Montana's small farmers and breeders," Diana Blair told the commissioners.

By creating the value-added yarn products, fiber breeders can increase their sales and that brings more money to purchase veterinarian supplies, increase herd size, buy hay and pay for marketing.

"Without our mill, most breeders will either incur additional expenses for shipping, which eats up their profit, or they send it to the wool pool for cents on the dollar or dispose of it and make nothing," she said.

"It's a trickle-down effect," Blair continued. "We're the hub in the wheel."

Blair said she offered to send the county a partial payment of $800 on the delinquent taxes, but was told the county only accepts payments in full.

When the couple became concerned that their mill property might be seized for back taxes, Rep. Jon Sonju, R-Kalispell, got involved and encouraged the Blairs to pursue the tax break.

Sonju wrote a letter to the commissioners, voicing his support of the tax break for the fiber mill, noting that he doesn't support the state's business-equipment tax.

The county has extended the deadline for seizing the mill property to Nov. 15, but the commissioners are expected to render a decision on the tax break before then.

Features editor Lynnette Hintze may be reached at 758-4421 or by e-mail at lhintze@dailyinterlake.com