Last week I had the opportunity to participate in the Seeley Swan Pathfinder’s candidate debate. I appreciate events like these because they allow the community to hear directly from candidates, which helps promote democracy along with an understanding of the issues Montanans’ elected representatives will deal with once elected to office. Debating in open forums like these promotes the healthy dialogue and sensible solutions we are all hungry for right now.
A hot topic at that debate was an issue that has been top of mind for a lot of folks recently — rising property taxes. Homeowners, small businesses and renters are feeling the impact. Last session, all of us serving in Helena knew a massive property tax hike was coming. But even with this knowledge and a $2.6 billion dollar surplus in the bank, a decision was made by the Governor and the Republican supermajority to let property taxes rise at the fastest rate in history.
Just before the last legislative session started, the Montana Department of Revenue prepared a document that outlined for Governor Greg Gianforte how much property taxes were set to rise, and how they could lower those taxes while maintaining a balanced budget. For the past 36 years, both Democratic and Republican Governors have used documents like this to calculate where to set property taxes so that critical services can be funded without over-collecting or under-collecting. Often that has come in the form of a property tax cut. But not this time.
Gov. Gianforte was advised by the Revenue Department in November 2022 that the rate for the coming two years would have to be cut from 1.35% to 0.94% to ensure that homeowners would not encounter a major impact. The Republican supermajority and the governor had everything they needed to get property taxes in check. An agreement was made to not adjust the rate, and that is why taxes have increased for homeowners at an unbelievably high rate. Instead, they decided to issue rebates that were expensive, temporary, complicated to obtain and didn’t help renters at all. In fact, the renters I visit with when I’m out in the community tell me they are dealing with rent increases as much as 50% directly caused by the property tax hike.
Because of all of this, a major tax shift resulted. In 2023, regular homeowners’ property appraisals increased upwards of 47% statewide, whereas major corporations who own things like railroads, utilities, telecoms, airlines and so on, saw their appraisals decrease. Big out-of-state companies were the winners, and regular Montanans were the losers. Meanwhile the middle class is getting priced out of their homes and landlords are forced to pass tax increases onto their tenants.
The Governor has tried to point the finger at local governments. A lot of critical local services, like schools, police, firefighters and road maintenance are funded from local property taxes after the state tells the locals what the tax rate will be. The Governor’s attempt to deflect blame here rings very hollow, especially when the surplus could have been used to prevent this disaster, or invest in education, health care or Main Street businesses.
This situation got Montana off track, and it could have been avoided. In the upcoming 2025 legislative session, Democrats running for the legislature and for governor are focused on policies to bring property taxes back down. For example, we want to exempt the first $50,000 of a home’s value from taxation, reverse the tax shift that harms residential property owners and make sure property taxes never rise beyond a middle-class family’s ability to afford it.
We’re ready to pass solutions that make it easier for Montanans to afford good homes in their own communities. This is how we get things back on track for regular Montanans.
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