Two coordinated property tax bills advanced with bipartisan support in the Montana Legislature Tuesday. Supporters say it’s not a perfect solution, but will lower taxes for homeowners and small businesses without cutting state or local services.
Republican Rep. Llew Jones helped craft it and says he understands it’s not popular with everyone.
“We’re going to have to recognize that in this state where the residential shift has been so enormous, both relative and real, that something has to be done.”
The proposal would offer $400 property tax rebates to primary residences this year. It would then lower tax bills for homeowners and small businesses by shifting a higher burden onto big companies, second homes and agricultural land.
The rate restructure would be rolled out in phases over the next two years to give the Department of Revenue time to implement the new system. Homeowners would need to apply to receive the lower rate for primary residences.
The proposal saw staunch opposition from representatives for large businesses, utility companies and farmers and ranchers. They say the higher tax burden may put some out of business and lead to price hikes.
Hardline conservatives echoed that concern when the proposal was debated in the Senate. Republican Sen. Becky Beard argued lawmakers should cap local government spending instead of shifting who pays for it.
“That is no way to confirm or affirm to our taxpayers that we are looking out for their tax dollars."
Property taxes are largely set by local governments. Some lawmakers warned these policies could overreach local governments’ authority and lead to lawsuits.
The policy package has to clear another vote before it moves to the governor for consideration.
