Voters in May expected to decide on $60M for Cold Smoke, $6.8M for park renovation
By Jack Reaney SENIOR EDITOR
The monthslong saga continues for Resort Tax: as the Big Sky Resort Area District explores long-term bonding to fund infrastructure outlined in its 2023 capital improvement plan, the board held another special meeting Thursday, Jan. 2 at the Big Sky Chapel.
The meeting’s objective was two-fold: first, for detailed discussions for all five projects deemed worthy in a separate special meeting in December 2024; and for the board to agree on maximum dollar amounts for potential long-term debt commitments to fund those projects. The five projects were estimated to cost $340 million in total, with their associated Resort Tax requests totaling $110 million.
After four-and-a-half hours of discussion, the board accomplished its objective, committing up to $66.8 million in public debt to be included on the May 2025 ballot. The BSRAD board agreed to commit up to $60 million for the Cold Smoke workforce housing project, and up to $6.8 million for the continued renovation of the Big Sky Community Park.
If the board approves a resolution and bonding reaches the ballot, voters will decide in May whether Resort Tax makes those commitments.
BSRAD’s board and Executive Director Daniel Bierschwale emphasized again that any voter-approved debt will be paid using resort tax collections, unlike a property tax bond which distributes the burden across local property owners.
A board subcommittee is confident that even if BSRAD maximizes its bonding capacity, BSRAD is planning for just 1% growth in resort tax collections to account for slower years. “We have been very conservative in our projections,” said subcommittee member Kevin Germain.
Bierschwale noted that bonds have failed recently in Big Sky, and they are typically not viewed favorably by tax-averse voters.
“Big Sky is special though, and we know that… we have this tool that other communities are very envious of, and we have an opportunity here to be able to make a significant impact… We’ve got a lot of education to do within our community if this is going to actually pass… This is uncharted waters, to a certain degree,” Bierschwale said.
BSRAD commits $60 million to housing: ‘the single most important thing’
A bulk of BSRAD’s potential $66.8 million commitment is centered around Cold Smoke, a planned development of 125 single-family homes for sale and 264 apartment units, all reserved for local full-time workforce.
The Big Sky Community Housing Trust is currently in negotiations with Lone Mountain Land Company to purchase the Cold Smoke land. The housing trust requested $45 million from BSRAD for that land acquisition, although the two parties have not reached an agreement on price.
Separately, the housing trust requested $15 million for the infrastructure costs associated with Cold Smoke. The asks are separate because their bonds would be issued and repaid separately—the $45 million would be repaid using BSRAD’s regular 3% collections, while the $15 million is eligible for repayment through the additional “1% for infrastructure” tax, implemented in 2019.
David O’Connor, housing trust executive director, said more than 80% of Big Sky’s workforce cannot afford market rate housing.
“We’re here trying to address that disparity right there,” O’Connor said. The per-home cost to develop Cold Smoke is roughly $154,000, compared to more than $388,000 to buy and convert existing homes to workforce-owned housing. Cold Smoke would take seven years to complete, compared to 20 years if the community opts for the alternative.
“It’s only going to get more expensive the longer we wait to address it,” O’Connor added, noting that if Cold Smoke fails, “plan B” is probably five years away.
Community member Mike Scholz praised the project, pointing out that Cold Smoke is the most important long-term project on BSRAD’s plate because it allows Big Sky’s future leaders—especially for public service roles like the Resort Tax board—to put roots down.
“Everything else can catch up. This can’t,” Scholz said.
Board member Sarah Blechta said that Big Sky hasn’t invested massively in workforce housing in its 50-year past, but that doesn’t mean that’s the right course of action anymore as today’s housing market excludes more working locals.
“We will lose people,” she said. “We are losing people… I think this is our opportunity to do something about it. And it’s a lot of money—it’s a lot of interest, it’s a lot of money, it’s a lot of time. But I think, to me, it’s the single most important thing that I can do for our community.”
The board emphatically supported the large-scale housing initiative, but deliberated on the details due to proposed legislation. Leaders from Big Sky and fellow resort tax communities have drafted a statewide bill that would include workforce housing in the “1% for infrastructure” category, and if the bill passes in Montana’s imminent 2025 legislative session, BSRAD could fund a portion of the $45 million land acquisition using 1% collections in a separate pool of money.
If the bill fails, board member John Zirkle warned that a $45 million commitment would “highly pressurize” BSRAD’s capacity to bond against its 3% collections—Cold Smoke alone would consume 84% of the bonding capacity, leaving only $2 million for other projects.
To allow for the possibility of successful legislation, the board voted to bond up to $45 million from the 3% pool, and up to $43 million from the 1%, with a potential split to be determined later. This contingency allows “maximum flexibility,” Zirkle said.
“We’ve got a lot of moving parts and pieces,” Germain said, emphasizing how legislative changes could create ripple effects for BSRAD’s ability to bond certain projects in the 3% category.
BSCO, parks met with partial support
Given the massive commitment to housing in the current legal landscape, other non-infrastructure projects were necessarily limited.
The Big Sky Community Organization brought two projects to the table: a $7.5 million renovation to the Big Sky Community Park, and a $5 million construction project to construct the South Fork Community Park near Town Center.
In a presentation to the board, CEO Whitney Montgomery described community parks’ role in recruiting and retaining community members, and fostering community connections.
The renovation would include improved public restrooms, safety improvements to Camp Big Sky—an important child care provider during summer months—and artificial turf athletic fields that could extend playing seasons by two to three months. The new park would provide a similar public space on donated land across town.
Montgomery said BSCO prioritizes the existing park over any new project, and the board eventually voted to commit up to $6 million to the renovation—the maximum was later increased to $6.8 million, allowing for the possibility that housing-related legislation is successful and frees up budget space in the 3% pool.
The board voted unanimously to exclude the South Fork park from this year’s debt commitments, due to the complicated timing with other large priorities.
Water and sewer projects on hold; BSRAD to consider cash for new arts center
The Big Sky County Water and Sewer District requested $15 million to help construct the second phase of its new Water Resource Recovery Facility. Phase two would increase the plant’s capacity by 67%, and enable the Gallatin Canyon County Water and Sewer District to pump wastewater from the canyon for improved treatment.
However, the BSCWSD decided to withdraw its request.
Water and sewer district board chair Brian Wheeler told EBS that representatives from all parties—both water and sewer districts, and BSRAD—believe it was best to withdraw the application for this year to help streamline the bond process.
The withdrawal should give an extra year for both water and sewer districts to forecast costs more accurately, and to finalize a memorandum of understanding with BSRAD regarding ongoing funding.
“We want to really tighten our preparation, [and] we recognize the need for other projects that are more time sensitive,” Wheeler told EBS.
The board also voted unanimously to exclude the $8 million request from GCCWSD, given the uncertainty of the WRRF’s second phase—the canyon sewer district already has $12 million in BSRAD funding from 2020, but the costs of constructing a sewer have increased by $8 million, according to GCCWSD engineer Mace Mangold.
Kevin Germain added that the delay in water and sewer projects should not indicate a lack of interest in their objectives.
“2025 should be the year of water-sewer discussions in this community,” Germain said.
Another right project at the wrong time, the Arts Council of Big Sky requested $2 million for its $13 million project to renovate an existing Town Center building into a community arts center.
The board praised the project, but given the large commitment to housing in the 3% funding pool, agreed it would be best to consider funding the request with cash in next year’s nonprofit allocation cycle.
With preliminary bonding decisions made, the board will look to finalize a resolution at its upcoming regular meeting on Thursday, Jan. 9.
