HB 914 would substantially revise how Montana’s lodging facility use tax revenues are allocated. The bill creates two new state special revenue accounts: one for county roads and infrastructure and one for municipal roads and infrastructure. It directs all revenue received under 15-65-121 into those accounts and requires the Department of Transportation to distribute the money annually to counties, consolidated city-counties, cities, and towns for road construction, reconstruction, maintenance, repair, and related infrastructure and marketing projects. County distributions would be based on each county’s share of lodging tax collections in the prior fiscal year, with a minimum and maximum payment cap; municipal distributions would be based on population, with small towns counted as having at least 200 residents and a cap on any single city or town’s share.
The bill also rewrites the existing lodging tax distribution statute to change the split among tourism, heritage, conservation, and economic development recipients, while preserving many current recipients such as the Department of Commerce, regional nonprofit tourism corporations, the Montana Historical Society, the university system, Fish, Wildlife and Parks, the invasive species account, domestic violence/human trafficking emergency lodging, and the state-tribal economic development commission. A key change is that the remaining balance after the listed allocations would be divided equally between the new county and municipal road accounts. The bill also adjusts some allocations over time by tying increases in certain percentages to inflation, and it preserves enforcement provisions that redirect funds if local tourism entities fail to approve required marketing plans.
HB 914 would amend sections 15-65-121 and 17-7-502, MCA, and add new statutory appropriations for the new road accounts. It would therefore change state law governing the lodging facility use tax and the statutory appropriation list, while also creating a new ongoing funding stream for local transportation infrastructure. The bill’s effective date would be July 1, 2025.
The general sentiment reflected in the available vote history is favorable at the committee level, at least procedurally: the House Taxation Committee voted 21-0 to table the bill, and the bill ultimately died in process. No committee transcript is available, so there is no recorded debate to show support or opposition arguments in detail. The unanimous committee vote to table suggests the bill did not advance, but the record provided does not explain whether that was due to policy concerns, fiscal impacts, competing priorities, or other procedural reasons.
The main point of contention appears to be the reallocation of lodging tax revenue away from existing destinations and toward county and municipal roads and infrastructure. That shift would reduce the share available for tourism promotion, heritage programs, and other current recipients, which could concern tourism organizations, state agencies, and cultural or conservation interests. At the same time, local governments and road advocates would likely support the bill because it creates a dedicated, formula-based funding source for local infrastructure. The bill also includes distribution formulas and caps that may have been intended to balance urban, rural, and tourism-area interests, but those formulas could themselves be a source of disagreement.
HB 914 would materially alter Montana’s lodging facility use tax distribution framework by creating two new state special revenue accounts for county and municipal roads and infrastructure and directing the residual lodging tax proceeds into those accounts. It would amend 15-65-121, MCA, to change the allocation percentages among existing recipients and add new statutory appropriations for the road accounts, while also amending 17-7-502, MCA, to include the new accounts in the statutory appropriation list. The bill would affect counties, consolidated city-counties, cities, towns, tourism entities, and several state programs that currently receive lodging tax revenue.
The available record shows no committee testimony, but the vote history indicates the bill did not advance and was tabled unanimously in House Taxation by a 21-0 vote. That suggests the proposal did not generate enough support to move forward, even though the vote itself does not reveal the underlying reasons. In policy terms, the bill appears to have mixed appeal: it would likely be welcomed by local governments seeking road funding, but it would face resistance from recipients whose lodging-tax shares would be reduced.
The central controversy is the reallocation of lodging tax proceeds from tourism, heritage, conservation, and economic development uses to local road and infrastructure funding. Tourism corporations, convention and visitors bureaus, and state programs that currently receive fixed percentages could oppose the reduction in their shares, while counties and municipalities would likely support the new dedicated funding stream. Additional tension may arise over the distribution formulas and caps, including the county minimum and maximum shares, the population-based municipal formula, and the treatment of small towns and local tourism entities that fail to submit marketing plans.