Senate Bill 260 was amended by the Senate Taxation Committee to focus on withdrawal of Big Sky Resort Area District (BSRAD) residents who are part of Madison County from the Madison Valley Hospital district and passed by a 6-2 vote on March 28. 

The same language used in HB 846 to allow a workaround for Ennis and Big Sky schools was added to the bill and the term “service districts” was changed to hospital district throughout the text of the bill. Additionally the language in the original bill allowing corporations and LLCs located out of state to participate in the petition process was removed and the definition was changed to “an owner of real property located within the hospital district.” 

The amended bill also provides for a three year process to remove the property from the hospital district in equal parts each year and requires the properties withdrawing from the hospital district to become part of another district or create a new hospital district.  

“SB260 is more favorable than existing statute. Existing statute creates a fiscal cliff after withdrawal, but SB260 allows for a 3-year funding step down. This is important protection for the Madison Valley Hospital District if properties are approved to be withdrawn,” said Daniel Bierschwale, executive director of the BSRAD. 

That sentiment is not shared by the Madison Valley Hospital District. 

“SB 260 completely bypasses all involvement by the County Commissioners, the District Court, and Montana Supreme Court, and allows only the voters in the area proposing the alteration to vote on the issue and ultimately alter an existing hospital district boundary and remove that entire tax base from a hospital district,” stated Madison Valley Medical Center CEO Allen Rohrback.

“We submitted an amendment which would allow all voters in the entire district to vote on the

boundary alteration.  Senator Hayman presented this amendment on our behalf, and it failed in Committee.  Without this amendment, we oppose SB260 in its entirety,” continued Rohrback. 

“It is our position that SB 260 is greatly flawed.  It completely bypasses all involvement with county government, and the court system and violates essential fairness in voting rights,” he continued. 

“SB260 is designed to ensure that those paying for taxes for services that are geographically inaccessible simply receive those benefits in the community in which they are collected,” stated Bierschwale. 

“SB260 does not allow for residents of a withdrawal area to stop paying taxes. The bill requires an area withdrawing to join a new or established district. Big Sky is looking to establish their own hospital district, and therefore, these residents would not experience a tax cut,” he continues. 

Bierschwale goes on to explain the changes that Big Sky has undergone that led to the attempts to change the hospital district. 

“Between 2010 and 2020, Big Sky experienced 54% growth in the year-round resident population. This means an increase from approximately 1900 residents in 2010 to 3800 residents in 2020,” he said. “This, in addition to an increase in the tourism base has led to drastically increased demand in the Big Sky community for health care services. The reality is our community is growing and changing, and we need tax dollars to support services that residents actually use. Many residents bought their home decades ago, but the needs of the community have changed.”

The amended bill also requires the taxpayers who transfer from the hospital district to pay for the bonds they were indebted to while they were part of the hospital district. This provision satisfies the issue of bonded indebtedness that was pointed to during the original testimony in the committee on Feb. 12 as being potentially unconstitutional. 

Big Sky School District will be required to establish an advisory council for the students who are part of Ennis School District but attending school in Big Sky so that parents will have a voice in the operation of the school. This is in place of trying to give voters rights to the parents which would have potentially run into constitutionality issues.

While the bill holds the language of compromise for the school districts, the hospital district withdrawal remains a contested issue. During the executive action testimony in the Taxation Committee, the bill sponsor Senator Greg Hertz indicated there are still opportunities for amendment before the bill is read on the Senate or House floor. 

This is a developing story. The Madisonian will continue coverage as the issues develop.