Business owners showed up again at Ennis Town Hall to speak out against the proposed resort tax at a public hearing Monday evening.
“I just think the timing of this is terrible,” said Lea Anne Reinsch, owner of Otter Banks in Ennis. “I just think it should be looked at two years from now.”
The public hearing gave the town commission a chance to hear from the public about the proposed resort tax ordinance that was unveiled last month.
As proposed, the resort tax would be 3 percent and be in effect from June 1 to Sept. 30 every year. The taxable items would be luxuries and include lodging establishments, restaurants, bars and taverns and destination recreational facilities.
The draft ordinance also provides for the collection of the tax, enforcement procedures for businesses that are delinquent in remitting resort tax revenues, and the formation of an Ennis Resort Tax Advisory Council.
It also outlines guidance to the town commission for the expenditure of resort tax revenues.
About eight people attended the public hearing Monday and none spoke in favor of the tax.
With the economy struggling, the last thing businesses in Ennis need is another tax, Reinsch said. In fact, this tax could push businesses outside of Ennis.
“I see businesses creeping outside the city limits,” she said. “I don’t think it’s going to make the downtown area very inviting.”
Reinsch also was frustrated that the draft ordinance exempted farmer’s markets. Besides produce, people at the farmer’s market sell goods like T-shirts, soaps and art. If the tax is approved, then the market should be included, she said.
Steve Kack, owner of the Ennis R.V. Village, which is outside the city limits and wouldn’t be subject to the tax, was troubled by the duration of the proposed ordinance. If passed, the resort tax would be in place for 20 years.
Kack also agreed with Reinsch that the tax would push business out of town.
The resort tax would only apply to businesses within the Ennis city limits, but several businesses are located outside the city limits, he said.
“I think it does kind of help push businesses off of Main Street,” Kack said. “And Main Street is the draw in Ennis.”
Sherri Shows, owner of the Fan Mountain Inn agreed with Kack.
“The equality of the application of the resort tax in our little town is going to be extremely unfair,” Shows said.
Some of the discussion centered on the list of exempt items in the draft ordinance, that include garage sales, real estate sales and “clothing items without advertising or identifying slogans and/or pictures.”
But the list wasn’t specific on what kinds of clothing could be included in the tax, Reinsch said. For instance, if she sold a fur coat, which didn’t have any logos or advertising on it, would that be included in the tax?
If it were, then why wouldn’t an expensive ski coat be included, she asked.
These sorts of vagaries in the ordinance language could make it very difficult on local business owners, Reinsch said.
Ennis Mayor John Clark recognized the concerns of the business community in Ennis, but felt determined to let the voters decided on the resort tax.
“We’re not the ones deciding whether the tax will be here or won’t be here,” Clark said.
Dale Tucker, who lives in Ennis, but outside the town limits, wanted to know who brought the resort tax subject up again to put before voters.
“You’re looking at them,” said Ennis commissioner Diane McPhetres, referring to the commission members.
The reason the commission brought the resort tax forward again is because when citizens were surveyed about three years ago as to whether or not they were willing to pay for major road improvements around town, many of them said they wanted a resort tax, Clark said.
The commission will hold the first reading of the resort tax ordinance at their next regular meeting, Oct. 14. The ordinance must pass two readings prior to going before voters March 1. The commission will hold the second reading of the ordinance at their commission meeting Nov. 4.
After the public hearing, the commission also discussed putting a mill levy on the ballot with the resort tax. The purpose of the mill levy would be to give people another option of funding work around town beside a resort tax.
The mill levy must be for a specific length of time and for specific projects, Clark told the commissioners.
The commission will need to decide what projects should be funded by the levy and then the town will work with Great West Engineering out of Helena to estimate the cost of the projects so the commission can settle on a levy amount, Clark said.
However, if the commission was interested in fixing and maintaining roads in town, it could also look at forming road improvement districts, which would be a way for the town to levy money for work done around town, he said.
The idea would be that people in the different districts would pay only for the work and maintenance done in their district, Clark said.
The road improvement district would provide a steady stream of revenue for road maintenance and wouldn’t have to be put before voters like a mill levy, he said.
The commission made no action on the mill levy or road improvement districts.