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NWE Settlement May Slightly Increase Some Property Tax Bills

madcotreasurer.com

The arrival of property tax bills may be delayed in some of the counties affected by the settlement reached between the state of Montana and NorthWestern Energy. That settlement may also result in a slight increase for some.

It all stems from a disagreement over the 2016 appraised market value at $2.6 billion for Northwestern Energy. The Montana Department of Revenue and the company agreed to a market value settlement of $2.4 billion. That resulted in a reduction in the utility’s property tax bill of $10 million, but it’s still a $12 million increase from last year’s tax bill of $122 million.

The problem for local taxing jurisdictions is they based their budgets on what they thought they would be receiving, prior to the settlement.

Revenue Director Mike Kadas says that’s why the agency asked taxing jurisidctions to submit requests to the agency for property recertification.

“Now that they have recertified, they will adjust their millage, essentially up,” says Kadas. He says the taxing jurisdictions will make up that difference of what they were going to lose from NorthWestern Energy from the rest of its taxpayers.

“And we did it (recertify) because we knew the settlement would have a real impact on lots of different jurisdictions and we wanted to give them a chance to essentially true up their budgets,” he says.

In general, Kadas says the impact on property tax payers will be pretty minor.  The taxing jurisdictions most affected are schools. In Yellowstone County, for example the impact is expected to be less than ½%. 

The community of Broadview just northwest of Billings had the largest impact. Both the high school and elementary districts lost 2% of their budgeted amount.

The impact of the settlement on the state’s 95 school equalization mills will cost the state about $2 million.

Counties generally mail out property tax bills around now. Kadas says the counties that requested recertification can now prepare, print, and mail out tax bills. Those bills in the affected 20 counties may be delayed up to two weeks.

The 20 counties that requested recertification are Broadwater, Carbon, Cascade, Chouteau, Deer Lodge, Gallatin, Glacier, Jefferson, Judith Basin, Lake, Lewis & Clark, Meagher, Missoula, Park, Ravalli, Sanders, Silver Bow, Sweet Grass, Valley and Yellowstone.