A nonprofit working on affordable and workforce housing issues in Whitefish is set to receive a substantial increase in funding from an optional fee collected at restaurants in the resort town.

The Explore Whitefish board voted unanimously Oct. 9 to allocate to Housing Whitefish half of the money the tourism bureau collects from restaurants through the Community Sustainability Fund. The 1% voluntary fee — previously called the Tourism Promotion Assessment — is imposed at about 55 participating Whitefish restaurants, hotels and transportation businesses. It is used by the bureau to promote visitation, and stewardship and environmental initiatives.

In 2021, Explore Whitefish decided to deliver up to $75,000 of the assessment revenue annually to Housing Whitefish. With the recent change, the tourism bureau now expects the housing organization will receive up to $150,000 annually.

In a Thursday interview, Explore Whitefish Executive Director Julie Mullins said the new allocation plan came about after hearing frustrations from bureau members about the 1% fee. In particular, restaurant owners said it was overly complicated to explain to patrons why the fee is assessed and how it is used.

“I went around and spoke to every restaurant member and heard loud and clear that the program needed to be simplified,” Mullins said.

She said restaurant owners also stressed how Whitefish’s shortage of workforce housing was affecting their ability to stay open.

“Whitefish is really struggling with staffing shortages, and that is directly related to housing,” Mullins said.

Redirecting a greater portion of the restaurant fee to Housing Whitefish “is our way of supporting the issue immediately,” she added.

In an August interview with the Whitefish Pilot, Mullins noted backlash to the fee from some community members, which caused some businesses to withdraw their participation.

On Thursday, Mullins said there have been “misconceptions” about how the voluntary fee is collected and used, but she believes the new allocation plan makes it clear that Explore Whitefish’s intent is to preserve the character and livability of the city.

“As a community, we really do need to come together to manage this issue [housing],” she said. “Explore Whitefish is set to keep our town authentic.”

HOUSING WHITEFISH Executive Director Daniel Sidder said the new funding will go to the group’s efforts to launch a rental assistance program in the city.

Last month, Whitefish City Council approved a $200,000 infusion to the Whitefish Workforce Assistance Fund. Sidder said the additional money from the restaurant fee will help the nonprofit reach its goal of a $100,000 match.

The hope is to launch the rental assistance program early in 2024.

Housing Whitefish also expects to put some of the funding toward the second phase of the Alpenglow Apartments off Edgewood Place, and to help fund the nonprofit’s long-term operations.

“It’s a good acknowledgment of a pressing issue,” Sidder said of Explore Whitefish allocating more of the fee to Housing Whitefish. “It’s potentially doubling the amount of money we receive. In terms of long-term capacity, it’s going to be a really great opportunity.”

Mullins said Housing Whitefish will determine how the funds are spent.

“We are not housing experts,” she said of Explore Whitefish. “We believe in the [Housing Whitefish] board and their direction. We are going to stay in our lane … and let them do what they do best.”

With the new allocation plan, Mullins said the tourism bureau will have to balance how it funds other initiatives, like its grant program, the Friend of the Fish education campaign, Pledge for the Wild and Protect Our Winters, among other programs and sponsorships.

“We’ll have to take a close look at how we work with other organizations,” she said about diverting more funds to Housing Whitefish. “At this point we need to put our focus on workforce housing.”