Tribes won't help offset revenue loss to Lake County

Lake County government will have to adapt to a $1 million shortfall after the Confederated Salish and Kootenai Tribes announced they will not help offset the tax loss when they purchased Kerr Dam.

The tribes took ownership of Kerr Dam on Sept. 5 and changed the name of the dam, which was built in 1934, to Salish Kootenai Dam. The tribes do not pay state or federal taxes on their property, which means that Lake County government — from schools to road departments — will have to adjust their budgets. “We were disappointed to hear the decision,” Lake County commission chairman Gale Decker said. “We were holding out some hope that the tribe would find a way to make up some of the lost revenue.”

Decker said the county has a year to adjust their budgets, but $1 million is a deep cut. “Rural fire departments, search and rescue, libraries, senior citizen centers, will all be affected,” he said. “We do have a year to prepare so we will have a chance to take a look at where might be able to make cuts with the least impact on services.”

In a written statement, the tribes spoke of a need for caution in their new business venture. They are the first American Indian tribes to have purchased a major hydroelectric facility. The tribal council says the decision comes after careful consideration, and while there will be no payment at this time, there may be future contributions.

An arbitration panel last year ruled that $18,289,798 was the price tag for the Confederated Salish and Kootenai Tribes to acquire Kerr Dam from PPL Montana.

The American Arbitration Association panel in spring 2014 released the estimated price that Energy Keepers Inc. would pay on behalf of the Confederated Salish and Kootenai Tribes to acquire the Kerr Hydroelectric Project near Polson.

Energy Keepers is a federally chartered corporation owned by the tribes. The corporation was created to manage the dam acquisition.

At the heart of the hearings was a dispute over the price that PPL Montana wanted the tribes to pay for Kerr. PPL Montana wanted $49.4 million for the dam, while the tribes were offering $14.7 million — a $34.7 million difference.

The arbitration panel’s sales price included $16.6 million for the physical plant, $1.7 million for environmental mitigation costs and $15,250 for communications equipment.