Broadwater Correct On Equalization Tax
Author: MT43 News Staff Reporter
Broadwater Correct On Equalization Tax
MT43 News Staff Reporter
Broadwater County was correct in its decision to levy the full 95 mills in property taxes for state school equalization funding, one of only seven counties to do so. In a ruling issued Nov. 22, the Montana Supreme Court turned down a claim by the Montana Association of Counties (MACO) that the levy should be limited to 77.89 mills.
The ruling came on a lawsuit filed by MACO against the state and the Department of Revenue (DOR) which had directed counties to impose the full levy of 95 mills.
“We hold that Montana Counties must levy taxes according to DOR’s methodology for calculating statewide mills,” the court said. It said MACO’s reading of the law “is irreconcilable with the Montana Constitution and clear intent of the Legislature…”
The opinion was written by Chief Justice Mike McGrath, with the six associate justices all concurring. It is unusual for a lawsuit to be filed directly with the Supreme Court and unusual for the Supreme Court to accept original jurisdiction, sidestepping lawsuits pending in lower courts.
The nine-page ruling concluded by ordering “that the counties shall levy statewide mills pursuant to DOR’s calculations for the current and future tax years".
Broadwater County commissioners on Oct. 11 voted unanimously to levy the full 95 mills but to withhold the equivalent of 17.11 from the state pending the outcome of expected months of litigation in lower courts followed by appeals to the Supreme Court. The commissioners acted on the advice of County Attorney Cory Swanson who repeatedly cautioned that the law was unclear. He warned that if the county levied only 77.89 mills for the equalization tax, the county could end up owing the state for the difference, about $460,000.
The equalization tax is collected by the counties on behalf of the state to provide a level of funding for students in tax-poor districts in kindergarten through high school. It has been on the books at 95 mills for decades.
The other six counties that levied 95 mills were Meagher, Madison, Deer Lodge, Teton, Toole and Glacier.
