Whitefish’s final budget includes tax increase

Due to increased personnel costs and a decrease in resort tax collections, Whitefish property owners can expect a bump in their city tax bill.  

Whitefish City Council on Monday is expected to approve the final budget for fiscal year 2025 totaling $53.5 million. This represents an increase in expenditures of about $3.1 million over the prior fiscal year.  

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

A market value home of about $600,000 should see an annual increase of about $70.  

City Manager Dana Smith said the fiscal year 2025 budget is a challenge as the city “works to address lagging wages compared to the market and a decrease in additional property tax relief from the resort tax.”  

“The increase in expenditures is mostly due to an increase in personnel costs and a significant increase in capital expenditures, which are offset by a reduction in operating materials and services and debt service costs,” Smith said.  

Resort tax collections were $44,682 less than expected, however, the shortfall was offset by higher-than-expected investment earnings. With fiscal year 2025 property tax relief based on the prior fiscal year collections, the city will see a decrease of 5.97% in property tax relief.  

“It is apparent that significant inflationary impacts to the resort tax appear to be subsiding as growth in collections has slowed in FY 2024 and is far different from the 32% increase in resort tax collections in FY 2022,” Smith wrote in her budget memo.  

No new positions are in the budget. However, a pay increase of 8.5% for most employees is included in the budget following a market rate study that suggested the need to increase wages to retain employees. The increase factors in the market rate increase and a cost-of-living adjustment, along with longevity.   

The city’s taxable value for one mill increased by 2.47% from $79,090 to $81,046.  

The number of mills levied after the resort tax rebate is increasing to 56.38 from the previous fiscal year at 47.626.

Council is also set to approve the fiscal year 2025-2029 capital improvements program plan, which totals $57.2 million.  

COUNCIL WILL consider accepting a land donation from Billie Wartnow for property along JP Road near the bridge over the Whitefish River that runs adjacent to Riverwood Park.  

A section of the land on the western side of the river is adjacent to the city’s park and people have been accessing the river from the property for many years assuming it is parkland. Wartnow has decided to donate the property to the city for use as a public river access point in the public park.  

During a work session beginning at 5:30 p.m., Council has two items on the agenda.  

Codi Evenson, short-term rental specialist for the city, will provide an update on enforcement efforts for illegal vacation rentals. There are 380 short-term rentals licensed within city limits.  

This year the city has enforced regulations regarding 51 unpermitted units with 19 of those operating in illegal zones, and 22 short-term rentals have been removed from the market or modified into monthly rentals.  

Then Council will discuss the city’s Legacy Homes Program. Specifically, when cash-in-lieu of units should be accepted versus building deed-restricted units; and what incentives could be added/modified for developers to voluntarily deed restrict units or lots.  

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