Public safety committee continuing discussion of city’s funding options, needs
Updated 1 p.m. Aug. 21 to reflect that George Nikolakakos owns more than one property within the city limits.
The city’s public safety advisory committee continued their discussion of a community survey and funding during their Aug. 7 meeting.
Two state lawmakers on the committee, George Nikolakakos and Wendy McKamey, gave updates from the Legislature that pertain to the public safety discussion.
Aaron Weissman, committee member and owner of the local Teriyaki Madness, said that he was shocked by how little cities received from the marijuana tax and asked if there was any discussion of changing that so local communities got more of the funding to deal with the associated impact.
In November 2022, voters approved a 3 percent local option tax on marijuana sales in Cascade County.
That’s on top of the 20 percent state tax that stays in the state coffers.
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The local option tax went into effect Feb. 6, 2023 and it took some time for that revenue to make its way to the city.
Of the local option marijuana tax collected, the county will retains 50 percent, five percent will go to the Montana Department of Revenue and 45 percent goes to the municipalities in the county.
That division of the marijuana tax revenues is set by the state.
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According to the county, the 45 percent is split among the incorporated cities and towns based on the ratio of their population to the total county population. That includes the City of Great Falls, Belt, Cascade and Neihart.
Based on June 2022 marijuana sales in the county of $1,526,694.80, there would be a total tax revenue of $45,800.
Of that, the county would get 50 percent, or about $22,900.42 and the state takes their five percent.
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The county will determine how the remaining 45 percent is split.
Melissa Kinzler, city finance director, said in December 2022 that they estimate the city would receive about $20,000 a month or about $240,000 per year.
That estimate has held true and the city collected $220,000 in marijuana tax revenue for the last budget year.
City looking at options for using marijuana tax revenue [2022]
In discussing the committee’s potential recommendations, they started with tax increment financing districts.
Weissman said he thought TIFs were outside the committee’s scope and that they shouldn’t be trying to rewrite city tax policy.
Mike Parcel said he agreed, but thought commissioners should revisit the rules for approving tax abatements for property owners who are protesting their taxes.
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Joe McKenney, committee member and city commissioner, had a page of recommendations for public safety funding.
He said that his personal thoughts on tax abatements and TIFs included that there were few economic development tools available to local government.
McKenney said that TIFs are getting attention and there’s some discussion of ending those districts to move some funds to the general fund.
“Why are we thinking that because it did what it was supposed to do,” McKenney said, but could consider a quicker exit plan when using TIF and tax abatements.
He said they serve a real purpose, but could cause problems with city budget when they last longer.
Generally, the timelines and specifications of TIFs and tax abatements are set by state law.
Nikolakakos said that he thinks TIFs are in the committee’s purview and that to the lawmakers eye, “we do relatively speaking a pretty good job in Great Falls and Cascade County.”
He said he has issues seeing TIF being used for projects that don’t generate taxes and that divert funding from schools.
Nikolakakos said that he expects some movement on the state level regarding TIFs, but he generally leans toward local control.
McKamey said that she likes TIFs and thinks they’ve done good things, but would be fine with revisiting those timelines.
She said she didn’t want to take TIFs away entirely.
Sandra Guynn, committee chair and a neighborhood council member, said that she likes TIFs and tax abatements but thinks city should reconsider giving abatements to companies protesting their taxes.
The group also discussed whether to recommend the city conduct a public opinion survey regarding public safety.
Parcel said the city should since otherwise they don’t know what voters want.
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McKamey agreed the survey should be done, but that it should involve city staff going out to where the people are.
She said the public needs to have their say and “I don’t think that everybody was paying attention. I think that was the problem. They simply weren’t paying close enough attention to know what they were really voting on,” McCamey said of the failed 2023 public safety levy and bond votes.
She said much the result was much like legislators and that if they don’t understand what they’re voting on, they’ll vote no.
McKamey is a county resident and does not live in the city limits, meaning she doesn’t pay city taxes or
Nikolakakos is also a county resident but owns multiple properties within the city limits and pays city taxes on those properties according to public property records.
Nikolakakos said that for running a business, polling is smart but was skeptical of government paying for a poll.
He said it was obvious to him that inflation and the property tax increases last year were reasons people didn’t vote for the levy and that the polling would say the same thing.
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“It’s expensive and somewhat likely to give us pretty obvious answers,” Nikolakakos said.
He said it would also irritate taxpayers and suggested setting up a small group to develop and evaluate a survey then have volunteers go out and knock on doors.
McKenney, a city commissioner, said that last year the city only heard soundbites and not public feedback, for which the city needed to hire a professional firm,
He said that the city needed that information to make a proper decision on whether to go forward with a levy,
“We’re operating in a vacuum, we don’t have the information we need,” McKenney said.
Weissman, committee member, said that he had reservations about a community survey since the 2023 election was a pretty clear indicator of their opinion.
The levy and bond for public safety were an “eye wateringly large amount of money,” he said.
City considering poll on public safety needs, levy
Weissman said he thought the public would be irritated if the city spent $30,000 on polling after voters said no to the levy with their ballots.
There were just over 15,000 ballots returned during the November 2023 election with the elections office mailing 25,884 ballots, Sandra Merchant told The Electric at the time.
For the public safety levy, there were 5,620 votes in favor and 9,095 opposed. For the bond, it was 6,726 in favor to 7,925 opposed.
Guynn, committee chair, said she was in favor of a poll and “we’ve got to hear from the community.
She said neighborhood council and crime stoppers events weren’t well attended so the question was hot to get public feedback.
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McKamey said it might be too outside the box, but the city could rent the stadium and do a fire versus police baseball game.
The fire and police unions held their annual Guns and Hoses game at Centene Stadium on July 16 followed by a Voyagers game.
McKamey said she thought people would listen if they felt “you’re trying to wrap your arms around them.”
She said they were focused too much on the issue rather than the people.
Tony Rosales suggested splitting the city departments for separate levies as the library did and let departments determine their own levies.
The library is a city department but operates differently in that it has its own joint city-county board and a management agreement with the city. Their levy still needed commission approval to go to the ballot.
All public safety departments fall primarily in the city’s general fund and those departments don’t have the authority to put their own levies on the ballot.
City officials discussed multiple times during public meetings their reasoning for combining the public safety departments into a single levy was that the departments were intertwined and the needs of one department affected others, such as more police on the street could have a significant impact to the already overloaded city prosecutors office and Municipal Court.
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Several committee members said they thought people might support one department or smaller amounts of levies.
The committee members made some of their own draft recommendations for discussion the committee.
Those recommendations are available here.
Nikolakakos said that he supports libraries but since that budget is healthy now and public safety needs help, commissioners should consider taking seven mills under the city’s library management agreement and shifting them to public safety funding.
Weissman said they should be careful about taking money from the library right after voters chose to support the library. The seven mills in the agreement were included in the library’s discussions on their funding structure and revenue projections.
The city and library board are currently in discussions on their management agreement, which was renewed in April for another year.
He said they need to ask the Legislature to give more funding to cities and more of the marijuana tax revenue to local governments.
He suggested increasing fees for fire services and business licenses.
Great Falls Fire Rescue has proposed increased fees and adding some new permits and fees. That proposal was presented during a spring work session but commissioners have not discussed it further during public meetings.
The public safety advisory committee meets again on Aug. 20.
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