Rep. Dave Fern, D-Whitefish,

Rep. Dave Fern, D-Whitefish, speaks on the House floor of the state Capitol.

A bill to feed coal tax revenue into affordable housing loans heads to a state conference committee Friday after its sponsor declined to ask the House to concur with amendments made last month in a Senate committee.

Rep. Dave Fern, D-Whitefish, carries House Bill 16 for the state Legislature’s interim Local Government committee. The bill directs the state Board of Housing to administer $15 million from the state coal severance tax trust fund, which collects half of state coal tax revenue and feeds into such programs as the Treasure State Endowment Fund and Big Sky Economic Development Fund.

Under the bill, loans made by the Board of Housing from the $15 million appropriated by Fern’s bill must go toward multifamily rental housing for low- and moderate-income Montanans. Fern said his interest in carrying House Bill 16 stemmed from the housing situation in Whitefish, which he described as “particularly challenging” for residents of various income levels.

“Property and rentals are quite high and oftentimes wages can be pretty modest, so that combination led to a need,” Fern said.

The U.S. Census Bureau’s American Community Survey estimated Whitefish’s median value of owner-occupied housing at $326,100, and median rent at $898 per month in 2017. Estimates of the state average stood at $209,100 and $751 per month, respectively.

The bill came before the House for the second time Tuesday. Fern asked his 99 colleagues not to concur with amendments approved in March by the Senate Taxation committee and got his wish when the motion passed 68-32.

Fern said he felt it "valuable" to seek more discussion of the amendments, one of which requires projects constructed with the loans be subject to property tax.

"That's (at) least potentially problematic because sometimes we're working with housing authorities or nonprofits," Fern said. "And one of the strategies of keeping the prices within an affordability framework would be the status of taxation on the land."

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Fern said the other Senate amendment, which set a cap of $1.5 million for individual loans, "might work fine," though he found it unnecessary. A cap could be best decided outside the Legislature, he added, possibly by the state or local housing boards.

A conference committee will meet Friday at noon to decide the bill’s path forward, which could include further amendments. The House appointed Rep. Tom Welch, R-Dillon, and Rep. Terry Moore, R-Billings, to join Fern on the committee. The Senate appointed Sen. Roger Webb, R-Billings, Sen. Mark Blasdel, R-Kalispell, and Sen. Edie McClafferty, D-Butte.

Moore and Welch voted with Fern both times the bill came up for second reading on the House floor. Welch also voted to send the bill to the House floor with amendments when it came before the House Taxation committee in February.

All three senators on the conference committee serve on the Senate Taxation committee, which considered Fern’s bill March 12. Blasdel cast the lone vote on the 12-member committee against amending the bill and sending it to the Senate floor, where it passed April 4.

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