Montana

Cash crunch triggers lease hikes in Virginia City, Reeder’s Alley

Published

3 months ago

December 23, 2025

Cash crunch triggers lease hikes in Virginia City, Reeder’s Alley

Things are escalating into a standoff at Montana’s state-owned ghost towns, where rising rents and theme park ambitions, along with a case of embezzlement, are frustrating the owners of some of the state’s top tourist attractions in neighboring Virginia and Nevada cites in southwest Montana and Reeder’s Alley in Helena.

Operators of popular attractions like the Illustrious Virginia City Players, a beloved seasonal theater and vaudeville show, say new lease terms drafted by the Montana Department of Commerce are unaffordable. The state is asking for a standardized 15% of gross sales from Virginia City restaurants and the town theater troupe, this after years of collecting smaller and varying amounts from businesses. Vendors have been told to accept the new terms or clear out by the end of the month, said Errol Koch, whose family has performed at the Virginia City Opera House for decades.

“To say that we ever had a gross, like a net profit, is laughable,” Koch said, “because everything we ever made either went to stockpile for the next season, to pay employees or to, like, just survive the winter. The profit part is negligible at best.”

The commerce department estimates that, before expenses, the Opera House brought in $126,000 in 2025. Rent would be $19,000 under the new lease terms. That would leave $107,000 to cover four months of payroll for roughly 15 employees.

Actors spend the summer performing original plays and vaudeville acts in a small opera house anchoring the west end of the Wallace Street wooden boardwalk. The players are a main draw of the 1860s gold rush town that sprang up along the banks of Alder Creek and was the territorial capital until 1875.

The acting troupe lives in a collection of small cabins, also owned by the state. In addition to wanting a 15% cut in gross income, Koch said the state also wants rent for the cabins, and it wants the copyright for any material written by the performers, an ownership requirement Koch said is typically associated with major entertainment companies like Disney. The commerce department told Montana Free Press the copyright language has been in opera house contracts since 2009.

In a state budget committee hearing last week, commerce Deputy Director Mandy Rambo told legislators that Montana heritage properties in Virginia City, Nevada City and Helena’s Reeder’s Alley have fallen hundreds of thousands of dollars short of annual revenue expectations for several years. Tourist season revenues have been expected to exceed $1 million, but have mostly come in at $750,000 for the three locations.

Rambo cited mismanagement by the Montana Heritage Commission, a part of the commerce department that oversees the properties. Losses include a years-long embezzlement by a former executive director, Michael Elijah Allen, who earlier this month was sentenced to three years in prison and ordered to pay $280,000 in restitution. An accomplice, Casey Jack Steinke, was sentenced to one year in state custody and ordered to pay $100,000 in restitution.

“It is a mismanagement of funds through several scenarios, not charging rent to people, not charging market rents to people who are renting from the Heritage Commission, overspending funds that the commission did not have,” Rambo told lawmakers.

LUXURY LODGINGS?

The changes come as the state eyes 99-year leases for parties to invest a “substantial amount” in improving heritage property. The change in the law, passed by the Legislature earlier this year, preceded by several months an elaborate proposal by California-based developer Auric Road to transform Nevada City into “a living frontier village — a 21st-century homestead camp where guests can immerse themselves in Montana’s heritage while enjoying modern comforts.”

Nevada City is the site of several buildings and antiques relocated from various locations by the former Virginia City curator Charles Bovey, whose estate sold its heritage assets to the state of Montana in 1997 for $6.5 million. The location is a less robust attraction than Virginia City.

The commerce department said last week that Auric Road withdrew its plan sometime after presenting it to the Montana Heritage Commission in September.

The pitch was luxurious, especially when compared to current Nevada City conditions. The local hotel is closed for major repairs. The proposal included three-star accommodations at a restored 14-room Nevada City Hotel, guest cabins with multiple bedrooms and enough extras to transform Nevada City into a year-round destination, according to Auric Road. There were also wall tents and Conestoga wagons with full indoor bathrooms. There was to be candle making, gold panning and glamorous camping, or “glamping,” at an area dubbed the “River of Gold.” The plans also called for adding a speakeasy railcar where craft cocktails would be served.

Auric Road, which operates Lone Mountain Ranch, withdrew a proposal for luxury lodging options in Nevada City, including glamping and Conestoga wagons with full indoor bathrooms.
Credit: From the Auric Road proposal submitted to the Montana Heritage Commission

Rambo, testifying for the law change before the House Administration and Veterans Affairs Committee last February, specifically offered Nevada City Hotel renovations as an example of why the change in law was needed to attract companies with deep pockets, including a $1 million cost estimate for raising the two-story building to do foundation work.

Auric made inroads into Montana’s heritage properties this summer when it took over management under contract for Virginia City’s Bale of Hay Saloon, which touts itself as Montana’s oldest bar. State officials said the contract, awarded July 24, spanned the remainder of the 2025 season. A contract for 2026 hasn’t been created.

Like other Virginia City properties, the 1863 bar is a state-owned enterprise leased to private vendors. After the commerce department parted ways with the previous vendor, Marie Clark, Clark took to social media, accusing the state of driving her out to make room for what she called “Lone Mountain Ranch,” a Big Sky-area resort property also owned by Auric Road.

Auric Road did not respond to an interview request made through the company’s website for this article. Clark said in an email this week that she and the state have reached a settlement over her dismissal from the lease. The department confirmed last week that it had paid Clark $20,000. The agreement prevents her from further disparaging the department, Clark said, and she has removed her earlier criticisms of the commerce department from social media.

Auric Road’s now-withdrawn plans for Nevada City sound out of tune to Virginia City vendors, who say their combined community is a regional draw, attracting Montanans who want to see an intact territorial mining town.

“There’s nothing they want to do that matches us at all,” said Shauna Laszlo Belding, who operates Bob’s Place, a pizza and sandwich restaurant, with her husband, Kirk Belding. “I go to (Auric’s) website, and you’re not staying in a room for $300 a night. Lone Mountain is $800 a night. Our clientele is regional families. They can’t afford that.”

In Virginia City, a community with about 500 full-time residents, the reality of the frontier west is grittier than fiction. It’s a place where alleged outlaws led by a mining town sheriff were accused of robbing miners and hanged on “boot hill” by vigilantes who apprehended and killed more than 20 people. The deformed foot of one of those hanged, “Clubfoot” George Lane, was removed from his body and put on display in 1907. The foot didn’t stop being a tourist attraction for a century, but was cremated at the request of Lane’s family in 2017, when the community received a replica foot for display.

This photo of Virginia City was taken in 1866. Today the town is home to about 500 year-round residents and many more tourists in the summer sesaon. Credit: Historic American Buildings Survey/Historic American Engineering Record/Historic American Landscape Survey (HABS/HAER/HALS) Collection

Rocky dredge piles churned by mining operations that sifted through Alder’s placer 160 years ago are still heaped along the waterways, aka “River of Gold,” trailing from this community.

Virginia City is changing, Koch said. There’s a seasonal housing shortage. Homes that once provided affordable shelter for seasonal workers are now vacation rentals. Virginia City is still the Madison County seat. Taxes are still paid and divorces are still filed in the historic brick courthouse. There’s a two-cell jail with bars down in the basement.

Still, one bald mountain pass to the east, Montana’s modern gold rush of real estate, fly fishing and cattle is spreading fast in Ennis, population 1,100. The runway at the county airport accommodates personal jets. There’s a private mountain backroad to the ski resorts of Big Sky, which otherwise takes an 87-mile trip around the Madison Range to access.

The Beldings were five years into a 20-year lease when the commerce department informed them that the state wanted 15% of their gross income and their old lease was void. The new lease, non-negotiable, was also subject to annual revisions by the state.

Explaining the new terms to legislators last week, Rambo said the 15% was standard for “turnkey businesses,” meaning businesses with landlord-provided equipment and branding, capable of operating without tenant investment.

REEDER’S ALLEY

Tenants say not all the properties are ready for business. In Helena’s Reeder’s Alley, it took the state 10 months to bring the stairway and deck leading to Chris Starr’s barbecue business into compliance with local regulations. The brick-paved alley is the oldest part of Helena, built in the 1870s alongside housing for miners.

Starr said he learned the stairs were out of compliance the hard way, on his second day of business in Reeder’s Alley operating RockStar BBQ. Helena safety inspectors told him the stairs would have to be roped off until they were repaired. He then learned that the same order about fixing the stairs had also been issued 10 years earlier. This time, the poor conditions of the deck and stairway resulted in a pause in his liquor license.

In the winter months, the icy walk to Rockstarr’s back entrance made the restaurant uninviting, Starr said. The business became fully accessible in August, about nine months after Starr moved in November 2024. Starr said the condition of the site during his first year as a tenant almost broke him financially.

Last week, the commerce department published a list of new lease terms for 24 historic properties in Virginia and Nevada cities and Reeder’s Alley. RockStarr’s rent was listed as $800 a month with utilities paid, a “partial kitchen and brand-new deck.”

One legislator from the Virginia City area bristled last week at the commerce department suggesting the Legislature mandated an increase in lease revenue by assuming that a percentage of the Heritage Commission Budget would come from leasing.

“I understand that, and appreciate [it], that you can’t spend money you don’t have, but I think the terminology is a little bit misleading that, you know, the Legislature demanded or mandated that you do that,” Rep. Ken Walsh, R-Twin Bridges, told Rambo in committee Dec. 17.

Walsh said he recently consulted with former vendors of seasonal businesses and learned that a revenue share of 6% to 12% to the state was more feasible. Rambo had said the 15% rate was similar to what county fairs charge concessioners.

Lawmakers representing the Virginia City area were instrumental in making changes to the law sought by the commerce department concerning the management of the state’s heritage properties. Walsh carried a bill to allow the state to issue leases of up to 99 years.

Republican Sen. Tony Tezak, R-Ennis, carried a bill giving the commerce department more supervisory control over the heritage properties, a move away from the loose management by the Montana Heritage Commission during the embezzlement scandal.

The state’s heritage properties number 250. There are also 1.3 million historic artifacts, according to testimony from commerce department officials to the Legislature in February.

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Montana

Missoula and Western Montana neighbors: Obituaries for March 11

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2 hours ago

March 11, 2026

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Missoula and Western Montana neighbors: Obituaries for March 11

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Montana AG letter alleges Helena violates law banning ‘sanctuary cities’

Published

14 hours ago

March 10, 2026

Press Room

Montana AG letter alleges Helena violates law banning ‘sanctuary cities’

HELENA — On Monday, Montana Attorney General Austin Knudsen sent a letter to the City of Helena claiming the municipality is not in compliance with the state’s law banning “sanctuary cities.” The letter comes just under a month after the State of Montana launched an investigation into a city resolution on Helena Police policy and Helena’s involvement in federal immigration enforcement.

In the letter, Knudsen laid out the ways he believes the city’s resolution violated state law. The attorney general gave Helena 15 days to respond or reverse the policy. If the city does not comply, his office will pursue legal action.

“Helena’s resolution appears to contain blatant violations of this law,” wrote Knudsen.

MTN News

On January 26, 2026, the City of Helena adopted a resolution clarifying when and how the Helena Police Department will cooperate with federal immigration officials. The vote was 4 to 1. The Helena commission seats and the mayor are elected in non-partisan races.

In the letter, Knudsen alleges the resolution established “a broad sanctuary city policy” that seeks to protect every illegal immigrant, regardless of whether the individual had committed a serious crime or not. The state further claims the resolution gives illegal immigrants “special privileges” in plea deals and establishes a “free-for-all policy” where a police officer can request the unmasking of Department of Homeland Security and ICE officers.

Knudsen has requested that the City of Helena, in their response, specifically describe in detail how the resolution complies with Montana law, provide emails and correspondence from city staff and the commission regarding the resolution.

Helena City manager Alana Lake told MTN in a statement: “The City of Helena is aware of the issues being raised by the Attorney General’s Office and is reviewing the matter. While we cannot discuss the details of a potential legal issue, the City is committed to transparency and compliance with the law. The City takes these matters seriously and will continue to cooperate with the appropriate authorities while remaining focused on serving our community.”

Passed in 2021, Montana House Bill 200 prohibits a state agency or local government from implementing any policy that prevents employees or departments from communicating with federal agencies regarding immigration or citizenship status for lawful purposes. It also states governments must comply with immigration detainer requests if they are lawfully made.

HB 200 was backed by Republicans and passed with only Republican votes. Gov. Greg Gianforte signed the legislation into law on March 31, 2021.

Passage of the resolution by the Helena City Commission has drawn ire from conservative voices in Montana politics and on the national level.

The resolution said the commission supported the Helena Police Department avoiding “committing its resources to federal action for which it has no authority,” such as entering into an agreement with the federal government to directly enforce immigration laws. Under federal law, immigration enforcement is conducted by federal agencies under the Department of Homeland Security. However, under the Immigration and Nationality Act, state and local governments can voluntarily enter into 287 (g) agreements with the federal government that allow them to enforce immigration laws.

The commission further supported HPD’s policy not to stop, detain, or arrest a person solely on suspected violations of immigration law, including assisting other agencies in an arrest based solely on immigration law.

DEEPER LOOK: Helena has seen a growing debate over ICE and local police involvement

In the resolution, the commission also supported an HPD officer, using their own discretion, requesting the identification and unmasking of a Department of Homeland Security Officer if the HPD officer “feels it will not be interfering with the actions of federal officers exercising their jurisdiction.”

“This adversarial relationship by local law enforcement toward federal officers itself undermines public safety and forces immigration officers to fear for their safety when they are simply carrying out their lawful duties,” wrote Knudsen.

The resolution further supports the City of Helena’s policy not to consider immigration consequences in a plea agreement with a defendant.

The commission also supports the City of Helena not disclosing any sensitive information about any person – including immigration status, sexual orientation, or social security number – except as required by law.

“This is a restriction that directly conflicts with Montana’s prohibition on sanctuary jurisdictions, specifically ‘sending to, receiving from, exchanging with, or maintaining for a federal, state, or local government entity information regarding a person’s citizenship or immigration status for a lawful purpose,’” the attorney general wrote.

If a government is found to be violating Montana’s law banning “sanctuary cities”, the state could fine them $10,000 every five days, prevent them from receiving new grants from the state, and have their projects with the state re-prioritized. A government in violation can avoid penalties by becoming compliant with the law within 14 days of being notified of the violation.

Read the full letter from the Montana Attorney General to the City of Helena:

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Dispatches from the Wild: Montana’s wild inheritance at risk | Explore Big Sky

Published

1 day ago

March 10, 2026

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Dispatches from the Wild: Montana’s wild inheritance at risk | Explore Big Sky

Steve Pearce and the future of the BLM

By Benjamin Alva Polley EBS COLUMNIST

If you care about hunting elk in crisp October air, floating a clear-running river for cutthroat trout, or simply taking your kids camping beneath a sky unspoiled by drill rigs, you should be outraged that Steve Pearce was ever considered to run the Bureau of Land Management.

The BLM is the largest landlord in the West. It oversees nearly 245 million acres of public land—millions of those acres in and around Montana’s most cherished places. This land is the backbone of our elk and mule deer herds, our sage grouse leks, our pronghorn migration routes and our blue-ribbon trout streams. It’s also the stage on which Montana’s hunting, fishing and outdoor recreation economy plays out.

Putting someone with Steve Pearce’s environmental record in charge of that land is like handing your cabin keys to the arsonist who’s always hated it. In the four months since Pearce was first nominated, it emerged that, if confirmed, he and his wife would divest from more than 1,000 oil and gas leases in Oklahoma to address potential conflicts of interest. While some senators strongly support his “active forest management” approach, he still faces opposition from groups alarmed by his record on public land transfers. On March 4, the Senate Energy and Natural Resources Committee voted 11-9 to advance his nomination, despite concerns from conservation groups.

Pearce’s track record is no mystery. He has consistently sided with extractive industries at the expense of wildlife, habitat and public access. He has supported opening more public lands to oil and gas drilling, weakening bedrock environmental safeguards and undermining science-based management. His votes and public statements have signaled again and again that he sees wild country as an obstacle to be overcome, not a legacy to be stewarded.

For Montana, that posture is an existential threat. Our big-game herds rely on intact winter range and unfragmented migration corridors across BLM lands. Aggressive drilling, poorly planned roads and relaxed reclamation standards shred those habitats. Once you carve up a landscape with pads, pipelines and traffic, you don’t get solitude—or mature bull elk—back with the stroke of a pen.

Anglers should be just as alarmed. Headwater streams and riparian corridors on BLM ground are the life support system for native bull trout, cutthroat and wild trout. A BLM director hostile to environmental safeguards is far more likely to greenlight development that increases sediment, degrades water quality and depletes the cold, clean flows our rivers depend on.

If Pearce takes office, outdoor recreation—and the rural economies built around it—will not be spared. In Montana, hunting, fishing and outdoor recreation pump billions of dollars into local businesses, guiding operations, gear shops and main-street cafes. People travel here precisely because of the open space, healthy herds and functioning ecosystems that BLM lands help sustain. When those landscapes are sacrificed to short-term profit, we don’t just lose scenery; we lose jobs, identity and a way of life.

This is not a partisan issue, especially in Montana. Public lands are one of the few things we truly share: ranchers who graze allotments, tribal communities with cultural ties to these places, hunters and anglers who’ve long defended habitat, and families who just want a place to pitch a tent. A BLM director should be a careful, science-driven steward accountable to all Americans—not a politician with a history of dismissing environmental protections as red tape.

Montanans know what’s at stake. We’ve fought bad ideas before—land transfers, giveaway leases, rollbacks to bedrock conservation laws—and we’ve won when we stood together. Steve Pearce’s nomination should have been dead on arrival. The fact that he was even on the list tells us how vigilant we must remain.

Our outrage must translate into action: calling elected officials, packing public hearings, writing letters and voting as if our public lands are on the line. Truly, they are. The BLM needs a director who sees these landscapes the way Montanans do: as sacred ground, not a balance sheet.

Anything less is a betrayal of the wild inheritance we’re supposed to pass on.

Benjamin Alva Polley is a place-based storyteller. His words have been published in Rolling Stone, Esquire, Field & Stream, The Guardian, Men’s Journal, Outside, Popular Science, Sierra, and WWF, among other notable outlets, and are available on his website.