Cutting State School Tax Would Risk $460,000
 | Author:
Nancy Marks
Nancy Marks: MT43 News Secretary and News Editor |
Cutting State School Tax Would Risk $460,000
MT 43 News Staff
County Attorney Cory Swanson warned county commissioners that they risked blowing a hole of over $460,000 in county finances if they go along with a handful of other counties in reducing the annual property tax of 95 mills imposed by the state for equalizing state support of public schools.
At least four counties have signified that they will cut the tax to 77.89 mills in line with restrictions imposed by state law on the growth of property taxes. The state asserts that the growth restrictions do not apply to the equalization tax. In a letter sent to counties in early September, the Department of Revenue said the maximum remains at 95 mills and that local governments “may” levy that amount.
Speaking at the commission’s regular Wednesday meeting Oct. 4, Swanson noted that the state has filed a lawsuit to block Missoula County from reducing the tax. He speculated that the Missoula County case will not be decided in court until late this year at the earliest.
Broadwater County commissioners were to decide at their Oct. 11 meeting whether to impose the levy at 95 mills or a lesser amount. Due to sharp increases in appraised real estate values across the state and likely jumps in property taxes, commissioners in perhaps all counties are under pressure to reduce mill levies.
Swanson cautioned that if the courts ultimately decide against Missoula County, any counties that did not impose the full 95 mills equalization tax could be compelled to make up the difference in payment to the state.
Bill Jarocki, county administrative officer, recommended the commission impose the 95 mills as “the least-risk approach” because “if you have to make up the $460,000 difference, you don’t have it.” Swanson said he agreed with Jarocki.
County Treasurer Melissa Franks told the commissioners that 2023 tax bills should go to printing the week of Oct. 16 and be mailed out by Oct. 31 at the latest to give taxpayers 30 days to make their first-half payment, due Nov. 30. Second-half payments are due May 31, 2024.
The state school equalization levy is designed to balance state funding between tax-rich and tax-poor school districts.
In addition to Missoula County, other counties known to be planning to reduce their equalization levy to 77.89 mills were Beaverhead, Richland and Fergus, according to Montana Free Press.
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