Oppose HB 887 – Preserve Montana’s Proven Tourism Funding Model

Sponsor: Representative Jane Gillette, Three Forks

Montana’s lodging facility use tax has long been a smart, self-sustaining investment in economic development and community vitality. HB 887 threatens to break that model by capping Department of Commerce tourism funding at current levels and allowing only minimal inflationary increases going forward—decoupling funding from actual bed tax performance.

HB 887 threatens to break that model by cutting $2 million from the Department of Commerce’s tourism budget beginning in the 2029 biennium—with projected reductions doubling to approximately $4 million by the 2031 biennium—regardless of the continued growth of Montana’s visitor economy.

This significant reduction would severely impact key programs like Main Street Montana grants, tribal tourism grants, and the Pilot Communities Tourism initiative, undermining the very tools that help communities strengthen their local economies and preserve their unique character.

Why the Current Model Works

Since its inception in 1987, the lodging facility use tax has been structured to reinvest in what works. The more Montana gains in market share and visitor spending, the more resources are available to continue that success. This virtuous cycle has delivered decades of proven results—growing tourism responsibly while benefiting communities across the state.

HB 887 would sever that link. No matter how much additional lodging tax is collected, the Department of Commerce would be capped at a flat rate, undermining the ability to innovate, adapt, and expand tourism programming.

What’s at Risk for Montana Communities

The Department of Commerce supports programs that strengthen every corner of Montana’s visitor economy, including:

• SB 540 Initiatives – The 2023 legislative session championed new programs to support rural, under-visited, and tribal communities, such as agritourism grants, emergency service investments, and pilot community development programs.
• Strategic Marketing and Data Analysis – Promoting Montana in key markets and guiding informed decisions with robust tourism data.
• Visitor Infrastructure and Experience Enhancement – Funding improvements that benefit both residents and visitors.
• Support for Special Events, Outdoor Recreation, and Community-Led Projects—helping towns showcase their heritage, culture, and attractions in ways that generate sustainable local revenue.

Over time, HB 887 would freeze the Department of Commerce’s capacity to support these efforts, even as visitor needs grow, tourism trends shift, and new opportunities arise.

Montana Needs Flexibility, Not Funding Caps

In an increasingly competitive global tourism market—and amid federal land policy changes and evolving traveler preferences—Montana must remain flexible and responsive. HB 887 would lock the Department of Commerce into static funding, regardless of performance or need.

Contact your legislators to vote NO on HB 887 and uphold the performance-based funding model that has guided Montana’s tourism success for nearly four decades.