Jim Atkinson admits he has had a change of thought on how best to boost economic development in Kalispell.

The 21-year veteran of the Kalispell City Council, up for re-election to his Ward 3 post, once set his sights on attracting new industries to the area.

It was "glitzy," he said, to focus on recruiting high-paying, low-impact firms and dream of the resulting uptick in quality of life.

"But, one, we didn't have the economic incentives to do so," Atkinson said. "And, two, it's very difficult to get those industries here and then if they get a better offer" from another community in a couple years, the firm and jobs are gone.

As he took a hard look at economic development, he said he realized the focus needs to be on retaining the companies already doing business in Kalispell and helping them expand.

"They're here. They want to be here. They've been part of the community," he said.

"If we help them expand their people, they're probably going to hire here. It's just so much more a developing of our foundation here."

Still, he's fine with welcoming outside companies to Kalispell. A firm may fit well into the Old School Station or Industrial Park south of the city, and "we would be more than happy to have them. That's why we have the [tax increment finance district] there. But long term, our retention and expansion will be the most important."

Atkinson has been on the council long enough to watch the city's economic fortunes ebb and flow. With the meteoric rise of 2006 and 2007 and subsequent crash landing at the end of last year, Kalispell's city budget hit dire straits. Critics used the $1.5 million cash reserve that evaporated to $130,000 as their poster child for fiscal irresponsibility.

"We learned a good lesson," Atkinson said. "We're going to be very fiscally sound and frugal … so we don't get caught again."

But it will take sound leadership.

"Our ace in the hole right now is Jane Howington," he said of the council's newly hired city manager. Howington came from Dayton, Ohio, with a long resumé of city management experience.

"She's a very bright lady, she comes with well-tested ideas, she looks at things in a different way," he said.

Her 2010-11 budget planning schedule that involves council members in crafting the budget beginning in October also will help build trust, Atkinson added.

The city manager position came to Kalispell in the 1990s when Atkinson was part of the majority voting for it.

"The city-manager form of government was a very good step for our city because it grew to the size where it needed professional management," he said.

He also has been on the council since the city's first tax increment finance district went into play.

"Tax increment financing and tax increment districts are just about the only tool the Legislature has given the cities for community development and economic development," he said. They can be used to eliminate blight, develop the economy and support redevelopment.

Kalispell's Airport TIF District was created to tackle blight but, he said, it also set the stage for economic growth.

"The council in the '90s had a choice," Atkinson said. "We were essentially supporting the airport. It wasn't bringing in any revenue … We decided to keep it there and expand. Since then we made the tax increment district to help toward fixing it up."

Airport land leases, privately built hangars and landing and takeoff fees now bring in revenue that gets plowed back into the airport, he said. Federal Aviation Administration money for potential expansion would be forfeited if the council decided to stop now.

"This is an economic opportunity for us," he said. "It helps provide $24 million each year into the community."

But he also has long been an advocate of a local option tax. Whitefish has done well with its resort tax, but Kalispell's population is too large for state limits.

"I would like us to stay frugal and yet be able to provide services for our constituents," he said.

"At some point in time we need to see this happen. Right now the city of Kalispell has about 18,000 people servicing about 80,000 people, or maybe a million if you count tourists," he claimed.

"A local option tax would allow us to spread [the funding base] farther out … We have to focus on our tourism. It will be our biggest source of industry for many years to come."

Reporter Nancy Kimball may be reached at 758-4483 or by e-mail at nkimball@dailyinterlake.com