Market value assessment method chosen for Sewer District

SEELEY LAKE – The Seeley Lake Sewer District Board held a meeting June 15 where it seated its newly elected Board members, elected new officers, selected the market value approach to spreading assessments to pay for the administrative budget and set a new time for regular meetings. The Board also discussed hiring a new attorney for its regular business.

Directors Tom Morris and Jason Gilpin who were elected in May were seated at the meeting. They were not sworn in during the meeting because Morris and Gilpin had already completed their Oath of Office in front of a notary, May 10 and May 20 respectively.

Morris was elected President and Beth Hutchinson was elected as vice president at the beginning of New Business. Both votes were split with Morris, Hutchinson and Gilpin voting in favor and Directors Pat Goodover and Walt Hill voting against.

Hutchinson questioned whether the annual administrative budget of $214,329 was legally adopted at the Board’s June 4 special meeting. She pointed to Montana Code Annotated (MCA) 7-13-2275 that states that a public hearing must be held prior to the passage of a resolution increasing rates, fees or charges for services or facilities unless the increase is less than five percent. The annual budget more than doubled this year.

Jon Beal, the District’s attorney, said the MCA to which Hutchinson was referencing doesn’t address administrative costs or the budget but that MCA 7-13-2301 does. A hearing is not required under this section of MCA.

District Manager Jean Curtiss pointed out that the budget was introduced at the May 21 regular meeting but it wasn’t available publicly so the Board held a special meeting June 4 where it was adopted.

At the June 4 meeting the Board narrowed the assessment methodologies to two options to consider at this meeting. The two options were using land market values or a combination of and equal rate for properties with dwelling units, equal rate for commercially used property and an area rate for all vacant properties.

The market value method only uses the value of the land not the value of the improvements on the land. Curtiss explained that this method means that small residential lots in town would have a lower assessment compared to more expensive land like the lots on the lake. Additionally, Pyramid Mountain Lumber, Inc. would not be paying based on the value of the buildings or equipment but only on the value of the property.

Pyramid has been paying approximately 20 percent of the total taxes collected under the previous assessment method and has regularly argued that it was unfair because they produce very little wastewater.

Curtiss said the market value puts the biggest burden on the lakefront properties.

Hill said none of the methods are equal for everyone but he felt between the two choices the Board was considering that the market value was the better choice. He felt that Pyramid was important because they are the “economic engine” that runs the community.

Gilpin said he understood that the market value wasn’t fair to those with expensive land but that putting equal assessments on everyone wasn’t fair to those who were on real small properties either.

Hutchinson suggested working up a new method and holding another special meeting to consider it.

Hill motioned to adopt the market value. Goodover, Gilpin and Morris joined Hill in voting for it while Hutchinson abstained.

The Board voted to set a hearing on the assessments for Aug. 6 at 6 p.m.

A notice of the hearing and information on how to protest the assessment methodology will be mailed to all the landowners in the District. Landowners who wish to protest the assessment method need to do so in writing. If landowners representing more than 50% of the value of the assessments protest then the Board will have to choose a different method.

Hutchinson made a motion to hire a new attorney to deal with regular Board business. Hutchinson said the Board should hire a second attorney who would deal with regular business to separate them from the litigation attorney.

The Board’s current attorney, Beal, said he can’t communicate with Morris because he is a party in an active lawsuit against the District. Hutchinson said she thinks they need legal council with which all the Directors are comfortable and able to work with.

Hill didn’t think the Board should be hiring a second attorney as attorney bills are one of the things that ran their budget up so high last year.

Goodover said he felt that hiring a new attorney would be punishing Beal for winning against Morris and it would be a conflict for the Board to vote on it.

Hutchinson voted for hiring a new attorney while Goodover and Hill voted against. Morris and Gilpin did not vote on it or even participate in the discussion.

Two days after the meeting, Beal submitted a resignation to the Board as its business counsel, staying on to finish litigation in the active lawsuits including a second action that Beal filed against Morris and Gilpin ahead of them being seated (see page 1).

The Board moved the regular meeting time to 6 p.m. but maintained the third Thursdays for the date of their monthly meeting.

The next regular meeting is scheduled for 6 p.m. on July 16. Watch the District’s website seeleysewer.org for any special meetings, agendas and how to participate electronically due to COVID-19 concerns.