Business leaders express optimism

A panel of business leaders was generally optimistic about the near future for the economy in Montana and the Flathead Valley, and while some issues have their attention, no alarm bells are going off regarding the upcoming legislative session.

The Tuesday discussion at the Red Lion Hotel was part of the Kalispell Chamber of Commerce’s monthly meeting.

Speaking for the Flathead Building Association, Charles Lapp said Flathead County has traditionally ranked one, two or three among the state’s counties for housing starts. It is currently lagging behind Yellowstone and Gallatin counties but he expects starts to increase in the coming year.

Tia Robbin, executive director of the Northwest Montana Assocation of Realtors, had a similar view regarding real estate sales.

“We’re really seeing things turn around,” she said. “Our numbers are up over last year” both for residential and commercial sales.

Lapp and Robbin said they have an interest in ensuring that the Legislature doesn’t take any action that would effect exempt well drilling in the county and seeing that no onerous regulations pass affecting construction and real estate.

But so far they see no outright threats.

“Nothing has really come on the radar where say, ‘Boy, we really have to watch that,’” Lapp said.

Tony Patterson, chief administrative officer at Kalispell Regional Healthcare, said that with the implementation of the Affordable Care Act, “the whole industry is right in the bull’s-eye” for significant changes.

Many of the act’s provisions will be implemented in 2014, and their impacts are difficult to predict, he said.

“Our crystal ball is very cloudy, but it’s something our team has been focused on for a long time,” he added.

Nearly all of the panelists discussed the need to further lower unemployment insurance costs and workers’ compensation rates and reducing or eliminating the state’s business equipment tax.

Patterson said there were tort reform bills that passed the last Legislature that “made sense” to the health-care sector. The bills were vetoed, but he said they are worth further consideration.

Chris Hyatt, president of the Montana Firearms Institute, said there is interest in right-to-work legislation that gives employees the option to decline joining unions and paying union dues.

He said the burgeoning firearms industry is interested in laws that allow employers more flexibility in hiring and firing. He said the sector has a strong interest in improving training options for skilled workers, working through training programs at Flathead Valley Community College.

Diane Medler, director of the Kalispell Convention and Visitor Bureau, said lodging occupancy increased by 5 percent over last year’s numbers, and a big part of that can be attributed to Canadian visitation.

In 2011, there were 888,000 Canadian visitors to Montana, a 19 percent increase over the previous year. The amount spent by Canadians in Montana increased a whopping 48 percent in 2011 over 2010.

Medler said the tourism industry will remain committed to ensuring that revenue from the state’s 7 percent lodging tax will not be redirected. About 4 percent of the revenue is mostly used for promoting tourism in Montana, but in 2011 there were two bills that sought to tap into that revenue for other purposes. Those bills were vetoed.

“We’ll monitor that and hope it doesn’t come up again,” she said.

Keith Olson, executive director Montana Logging Association, said the industry is “less bad” than it has been for years, largely because of recovering demand for lumber.

He cited industry estimates that construction activity could increase by 40 percent in the coming year. “That could be very encouraging as it works its way through the economy,” he said.

This year, lumber prices are up 19 percent, mill production is up 19 percent and mill employment has increased by 26 percent, but Olson said those improvements come after years of stagnation in the industry.

“Indeed, less bad is good,” Olson said.

Reporter Jim Mann may be reached at 758-4407 or by email at jmann@dailyinterlake.com.