Whitefish council adopts FY2026 budget, approves levies and tax-related resolutions

The Whitefish City Council unanimously adopted the city’s fiscal year 2026 budget on Aug. 18 and approved a package of levies and special assessments tied to changes from the 2025 Montana legislative session. City Manager Dana said the council had reviewed the proposed FY2026 budget in three work sessions and that changes at the state level required staff to adjust local levies and explain impacts to residents. "We've gone over the proposed fiscal year 20 26 budget, multiple times," Dana said. The adoption matters because the state enacted a tiered property tax structure that changes how residential and commercial property are taxed. Dana told the council the new residential tax rates apply on a graduated scale (for example, a lower rate for the first $400,000 in value and higher rates for subsequent tiers) and that a Homestead Act implementation next year will distinguish primary-residence and second-home rates. Finance Director Lainie summarized how those formulas affect the city’s mills and projected revenue. City staff reported the city’s assessed market value increased substantially—about 28.5 percent—and that the city was able to lower its mill levy by 3.07 mills overall while keeping a voted fire levy as a dollar-based amount ($1,944,370) as directed by the council at a prior work session. Dana said converting the voted levy to a dollar-based levy preserves voter intent and allows the levy to be adjusted for inflation by the state in future years. Lainie presented the capital side tied to the budget: the five-year capital improvement plan (FY2026–2030) anticipates $57.3 million in capital projects, with $18.6 million planned in FY2026. Major capital items noted in the budget included the South Water storage and production project and resort-tax-funded street projects. The council also approved a 4 percent general pay increase for city employees (2 percent cost-of-living, 2 percent step) and additional market adjustments tied to collective-bargaining agreements; staff said many employees would see a total near 9 percent when those adjustments are included. Dana and Lainie provided examples of tax impacts for different home values as required by state law; they said the city’s portion of a typical property tax bill is 20 to 25 percent, and other taxing entities such as the county, school districts, and community college affect the total bill. Dana said many owner-occupied homes in more typical price ranges would see a tax decrease under the new structure, while very high-value properties could pay substantially more. For example, Dana presented a city calculation that a $5.3 million property would pay about $912 more in city property tax for FY2026, roughly a 20 percent increase on the city portion. The council voted unanimously to: adopt Resolution 25-17 (the FY2026 annual budget), batch approve Resolutions 25-18 through 25-28 (levies and special assessments), and adopt the FY2026–2030 CIP. Lainie noted the city's projected fund balance percentage would decline from 40.41 to about 35.91 percent by the end of FY2026, primarily to fund capital projects including a planned contribution for Depot Park townhomes. The council’s actions now authorize the spending and capital plans included in the budget document; staff will proceed with projects and levy administration under the adopted resolutions. The council will hold regular updates and work sessions as projects move toward implementation.