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Lawmaker Says Property Taxes Will Rise Without Legislative Action

A Republican lawmaker says if the Legislature doesn’t take action, property taxes are going to go up for homeowners, farmers and ranchers because of property reappraisal. 

The Montana Department of Revenue is directed by law to appraise property every 2 years at 100% of its market value. In other words, the sale price between a willing seller and a willing buyer.

In past sessions, there was legislation to mitigate the rise in property value to lessen the property tax bill. Not this time.

Representative Greg Hertz, R-Polson, calls that a silent tax increase.

“I don’t think we should be silent,” he says. “If we’re going to raise property taxes that should be up to the legislature and the governor to be honest with the taxpayers of Montana that we’re raising your property taxes.”

Because of the roughly $17 million fiscal impact to the state budget, the Senate Finance and Claims Committee heard House Bill 558. 

Department of Revenue Director Mike Kadas spoke against the bill.  He notes lawmakers went to a two-year property reappraisal cycle for many reasons, including for accuracy and simplification.

Kadas says an interim legislative committee decided against offering a mitigation bill this time.

“It takes a bit of an act of courage to step away from doing that. And say, ‘OK, what we really need to do is let the market decide the relationship between the classes,’” Kadas says. “If one type of property goes up more than another type of property then we need to let that happen.”

Kadas says lawmakers have been artificially preventing that from happening.

The Senate Finance and Claims Committee did not immediately vote on the bill.