Whitefish's final budget includes tax decrease

Whitefish property owners should see a decrease in their city tax bill as a result of a large increase in taxable value.

City Council on Monday is expected to approve the final budget for fiscal year 2024 totaling $51 million. This compares with last fiscal year’s approved budget of $53.4 million.

City Council meets at 7:10 p.m. at City Hall, 418 E. Second St.

Earlier this summer, the city’s preliminary budget incorporated an expected increase of about 10% for property owners as a result of a decrease in resort tax collections which provide a tax rebate. But an increase in taxable value means that city property taxes are now expected to decrease by about 7.5% for an average property.

A market value home of about $700,000 should see an annual decrease of about $55.

City Manager Dana Smith said property tax revenue will remain flat from the prior year and properties with no improvements during 2022 will see a decrease. New properties will make up the difference in total collections paid in the prior year by existing properties, she noted.

“While initially FY 2024 presented a challenge with the decrease in additional property tax relief from resort tax and rising costs, additional factors determined at year-end have eliminated the need for a property tax revenue increase,” Smith said in her memo to Council.

Council will hold a public hearing on the budget prior to approval.

The number of mills levied after the resort tax rebate is decreasing to 47.626 for the fiscal 2024 budget from the previous fiscal year at 76.275.

The city’s taxable value for one mill increased from just over $49,000 in fiscal 2023 to just over $79,000 in fiscal 2024, which represents a roughly 60% increase. The city’s preliminary budget had estimated a 10% increase.

The budget factors in a decrease of 16% in resort tax collections for fiscal 2023, which determines the property tax relief for fiscal 2024.

Overall capital spending in the budget is projected to decrease by $3.97 million compared to the prior year as construction wraps up on the Spokane Avenue watermain replacement project and the wastewater treatment plant upgrade project.

In terms of personnel, the budget calls for adding two additional full-time positions and one part-time position, and a pay increase of 5% for most employees.

Smith said most city employees in a normal year would receive an increase of 3.5%. She cited the current market conditions and the need to retain employees to ensure the city continues to “deliver exceptional service to our community.”

For reserves, the budget expects an ending balance of about 45% of property tax-supported funds. The city’s goal has been to keep that above 20%.

“During an economic downturn or recession having adequate fund balance and cash reserves for each fund is essential to maintaining expected levels of services for our citizens and ensuring a timely response to emergencies,” Smith said. “While possible delay in collections of property taxes and other charges for services can be expected due to uncertain economic times, cash reserves will help the city manage any cash flow issues that may arise.”

Council is also set to approve the fiscal year 24-28 capital improvement program.

ALSO ON the agenda, Council is set to vote on a resolution amending its Legacy Homes Program to update the purchase and rental prices, along with the area median income listed for Flathead County in the document related to affordable housing as part of developments.

The monthly rental rates increased by about 4.8%. The update also includes increasing the fee in lieu of providing housing to about $294,000 from $182,000 in 2022.

Council will consider amending its solid waste ordinance as a result of previous changes to provide all residential locations with bear-resistant containers. The update allows properties to contract with third-party recycling contractors, requires the use of the animal-resistant container, requires lids to be securely closed with no waste placed outside the container, allows containers to be placed for collection no earlier than 7 p.m. the day prior to pickup and removed by 7 p.m. on the day of pickup, requires all businesses that produce food scraps to use animal resistant containers or enclosures and require that all containers be placed 4 feet from any obstacles.

Council will continue the discussion regarding a pedestrian bridge crossing the Whitefish River in conjunction with the WF Yards development at 95 Karrow Ave.

During a work session at 5:30 p.m., Council will hear a presentation on the impact fee report update and then provide direction to city staff.

Features Editor Heidi Desch may be reached at 758-4421 or hdesch@dailyinterlake.com.