MISSOULA — In hopes of joining other Montana counties in a growing push to reform the state's tax system, Missoula County this week nominated one of its own to sit on the governor's task force.
Commissioner Josh Slotnick has led the charge in Missoula government in calling for statewide tax reforms. He may now have a seat at the table when Gov. Greg Gianforte's property tax task force convenes next year.
“We appreciate your recognition of the current property tax crisis and applaud you for establishing a task force to develop sustainable solutions for the 2025 Legislature to consider,” the county wrote the governor in a letter this week. “We agree with your assessment that property taxes are too high for homeowners across Montana and that finding long-term solutions to lower them will require the knowledgeable perspectives of stakeholders from across the state.”
Among other things, Slotnick helped spearhead an effort in 2019 to place a local option gas tax on the ballot for voters to consider. The measure passed but was later killed when the Legislature revoked the ability of counties to adopt such a tax, despite the Legislature having approved the right in the 1970s.
More recently, Slotnick also has been vocal in arguing that Montana's tax burden has shifted greatly over the last few decades, placing a greater burden on property owners while reducing the tax commitment of large corporations.
One figure cited by city and county officials in Missoula suggests that residential property owners now contribute 65% of the state's tax burden while corporations only pay 42%. It's a complete reversal from two decades ago, they said, and suggested taxation had reach a breaking point.
“One thing I suspect would come out of this task force is a recommendation that the state Legislature and the governor take seriously adjusting tax rates to shift the burden away from residential property owners, which hasn't been the trajectory in the recent past,” said Commissioner Dave Strohmaier.
This year, the state appraisal process also increased the value of homes around the state by an estimated average of 35%. The Department of Revenue warned the Legislature that the increase was coming and urged it to cut the state tax rate on residential properties from 1.35% to 0.94%. The Legislature and the governor ignored the advice and let a significant tax increase go into effect. However, the governor did push for a roughly $650 tax rebate for homeowners in both 2023 and 2024.
But some don't see rebates as a long-term fix to an ongoing problem.
“Elected officials agree that the current property tax system relies far too heavily on residential taxpayers,” the county wrote in nominating Slotnick to the task force. “It also constrains how much revenue cities and counties can bring in from property taxes.”
Taxation hit a breaking point this year when a majority of counties cited statute and capped the number of state equalization mills they intended to levy from 95 to 77. In doing so, counties contended that the state caps the number of mills they can levy when property appraisals increase, as they did this year, and so the state should be subject to the same rules.
In response, the state sued Missoula County over the issue, even though more than 50 other counties had also levied fewer mills. The push to levy fewer mills actually began in Beaverhead County, which said the state would net an additional $80 million by forcing counties to levy all 95 school mills in a year where property values spiked.
In November, the Montana Supreme Court sided with the state and ordered counties to levy the full 95 mills. But the debate could be a topic of discussion as the property tax task force convenes.
“This is almost with unanimous support,” Strohmaier said of the issue. “We've landed on a rare issue where Missoula County isn't the lone beacon of hope.”
Over the past few years, Slotnick has met with dozens of local government leaders from across the state to discuss the current property tax system and seek solutions.
In nominating him to the governor's task force, the county described him as “solution-minded,” and said he “has extensive knowledge of local government operations and Montana's property tax system.”
“Local governments, to varying extents, all rely on property taxes to fund core community services,” the county wrote the governor. “For the task force to successfully develop workable solutions to address the property tax crisis, local government must be at the table. Commissioner Slotnick would fairly and accurately represent this contingent.”
