Senate committee reviews bill to reallocate Montana lodging-tax revenue, boost victim recovery fund

The Senate Finance and Claims Committee on Senate Bill 409 heard testimony about a proposal to change how Montana allocates lodging-facility (bed) tax revenue, including a larger share for emergency lodging and recovery for victims of domestic violence and human trafficking and adjusted percentages for tourism marketing, rural tourism grants and heritage preservation.

Senator Daniel Zolnikoff, sponsor of SB 409, told the committee the bill replaces a confusing 63% sub-allocation that auditors flagged and sets explicit percentage “buckets” to guide spending. “There was no plan. There was no vision. There were no buckets,” Zolnikoff said, explaining the bill’s intent to clarify and reallocate existing bed-tax revenue rather than create a new tax.

The bill would move the statutory allocations so that, as written in the draft discussed in the hearing, 24.5% of the statutory lodging-use tax would be designated for Department of Commerce tourism media and advertising; 16.5% for what Zolnikoff described as “real tourism” seed grants for under‑visited areas; 15.5% for tourism-related emergency services and tourism grants; and 2.5% for the Office of Economic Development for regional tourism assistance. A previously small (0.1%) emergency-lodging line for victims would be increased to 2.5% to support lodging and short-term recovery services, Zolnikoff said.

Why it matters: supporters said clearer buckets let the state target marketing and grants to spread visitation and fund emergency lodging and short-term recovery services without drawing on the general fund. Opponents on the committee…