Montana Faces Property Tax Crisis, Governor’s Properties Buck Trend with Stable Rates

BOZEMAN: Deborah Newville, a resident of Bozeman, was taken aback when she saw her most recent tax statement. initially.

“It caught me off guard,” she remarked. As the initial shock subsided, concern emerged.

“We are currently at $12,000 for the year, so roughly a thousand a month in property taxes,” she continued, “but it’s a question mark.”

Many Montana property owners are in the same situation throughout the state; they’re trying to figure out why their property taxes went up so high and how they’re going to pay them.

Not all people are in the same situation. Unlike properties held by others in the same area, one Helena residence owned by Gov. Greg Gianforte experienced a decrease in property taxes this year, according to an MTN review of property-tax records. Because of its agriculture designation, one of the governor’s other homes in Bozeman received a lower increase than nearby properties.

Gianforte’s Helena property’s taxes were lowered, according to state revenue authorities, after a reappraisal. However, neighbors in both regions complain that the system is driving away more Montanans.

Introducing Deborah and Tony Newville

Although Deborah and her husband Tony were raised in Bozeman, they have lived in Oregon for the past few decades to raise their girls and pursue their professional aspirations.

Since there wasn’t much of a job market in Bozeman when the couple moved after graduating from Montana State University, Tony likes to refer to them as economic refugees.

Deborah was a forensic scientist, and Tony was a public defender for many years. She said, “In the end, my parents bought this property in 1968.”

Deborah’s father gave her the family home on Manley Road in Bozeman when she was a little girl, but they currently own a house in Portland, where their kids still live.

That was her original goal, but then Montanans were smacked with higher property taxes, which was a big deal.

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Deborah expressed her desire “to have something special like this to stay in the family.” “I was unaware of my dad’s passing.” I was not even given credit for what was happening.

Following the epidemic, Montana experienced historic growth and skyrocketing property values that few could have predicted.

The 1980s Manley Roadhouse of the Newvilles, with its 10 acres of property and classic green worktops, is now worth over $2 million.

Naturally, as a result, the property taxes went up. This is because, according to Republican state senator Brad Molnar, properties in the state are automatically reevaluated every two years.

He claims that because so many individuals were moving to Montana this year, lawmakers and Republican governor Greg Gianforte were forewarned that the increase in values may be considerably greater.

The Department of Revenue informed me that I would be facing some very significant tax increases. We have changed the multiplier and decreased the impact in the past if you don’t want to do that, said Molnar. However, state officials and legislators did not succeed in doing so.

Deborah began to inquire after seeing there had been an increase on her Bozeman property.

The governor, who happens to be our next-door neighbor, said that theirs had increased by a small amount, possibly a few thousand. Ours increased by $5,000, however.

What is excluded from agriculture taxes?

In the 1990s, Gianforte bought his 11-acre estate on Manley Road.

According to a representative for his office, the governor and his spouse, Susan Gianforte, possess agricultural land in that area, which is divided between irrigated barley and alfalfa. Additionally, mules and horses are boarded there.

The Montana farm exemption resulted in a 19% rise in the governor’s property taxes.

Ag exemption requirements must be satisfied, as Missoula County Commissioner Josh Slotnick explains.

“I think the rules should be updated, but no one is abusing this,” Slotnick said.

In Montana, any land larger than 160 acres is automatically classified as agricultural, meaning it is subject to a reduced tax rate. However, for your lot to be considered agricultural, it must meet specific requirements if it is smaller than 20 acres. Making $1,500 worth of farm products is one way, which if verified, can be eaten by humans or animals.

“Everyone I know who works in agriculture is following the rules,” Slotnick remarked. “I know people who pay their taxes and who follow the law. These regulations were drafted a long time ago, and they require an update, particularly about small-scale agriculture in Western Montana, regarding the ag exemption.

The Newvilles claimed to have inquired about obtaining an agriculture exemption for their land as well, but they discovered that the first outlay might reach $100,000.

They claim that the native cottonwood trees on their land act as a wildfire pathway, therefore they would also need to remove them.

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The Newvilles don’t think Gianforte is a farmer, but Deborah says she respects Montana farmers a lot.

“We were here during the peak of farm repossessions in the 1980s. Family farms are these, according to Tony Newville. To transfer family farms to the following generation was the purpose of the agriculture exemption. It wasn’t intended for multimillionaire real estate investors and developers.

How property taxes are calculated

According to sources in the governor’s office, mill levies, and property valuations are the two main factors that determine property tax payments.

According to a spokesman, property tax payments may differ depending on a jurisdiction’s spending choices, even while homes in different jurisdictions may have comparable value increases due to reappraisals.

Everyone involved in the property tax debate can agree that understanding the problem is difficult.

The state is not funded by property taxes. Among other things, they are used to fund the budgets of the county, city, and schools.

“All of the Republican-taken tax actions, including the governor’s, were tax cuts,” stated Kyle Schmauch, the GOP Senate majority in Montana’s director of communications. “A large portion of the tax burden ends up shifting over to the residential side when we have a huge influx of value and residential development and a decrease in industrial.”

Schmauch believes Montanans can look at many issues if they want to assign blame for their property tax increases.

According to him, the three main recipients of property taxes in Montana are county, city, and school governments.

Because of how hard Republicans worked to lower taxes during the previous session, he claims it is unfair to place the burden on the governor or the legislative leadership.

“The state government is financed by income taxes,” he declared. “The biggest distinction between properties is the amount of money spent in counties versus cities.”

Schmauch stated that counties with more conservative tax policies—including Republican-leaning Yellowstone and Flathead—saw smaller increases in property taxes than counties with the highest number of Democrats in the state, like Missoula, Gallatin, and Lewis Clark.

What’s up with Helena’s property taxes levied by the governor?

It appears that the people who reside across the street from the governor’s Helena residence also pay higher taxes than he does.

Gianforte’s property at 618 Madison Ave. is located in Helena’s historic district, and MTN News spent hours going over public tax records of close to dozens of homes.

According to the MTN analysis, the majority of those residences in that neighborhood—aside from a small number—saw significant increases in their property taxes, ranging from 11% to 40%.

MTN met with a man in his late 80s who was on a fixed income and lived in the same historic district of Helena, but his property taxes had increased by 62%.

Property taxes at the governor’s Helena residence dropped by 6.92% over this time.

According to the Department of Revenue, the property is now offered for $2 million on the market, with an assessed value of approximately $770,000.

Our questions concerning that particular property were never answered by the governor’s communications staff, but the Department of Revenue stated that the governor’s house was reappraised at a greater value—though still less than that of his neighbors—which is why property taxes have decreased.

Molnar has been an outspoken critic of Gianforte’s property tax policies; he has even filed a lawsuit against the state, claiming that there is no more room for forgiveness.

The Laurel Republican sees a system that is in dire need of changes rather than misconduct.

“I firmly believe that the governor did not attempt to obtain a preferential arrangement,” Molnar declared.

According to a Gianforte representative, the governor gave Montanans record tax relief this year, returning $675 in property taxes and $1,350 in income taxes.

Furthermore, he backed legislation that would have let homeowners pay their property taxes in seven equal installments throughout the year as opposed to two in November and May.

Although every Montanan has a unique situation, the Newvilles’ property tax increases would have been unaffected by those refunds even if they had been eligible for them.

Deborah remarked, “It’s a question mark every day.” “We’ll observe the situation.”

She, along with many others, is currently hoping for a more long-term and reasonably priced property tax alternative.