BOZEMAN — Gallatin County is one of the fastest-growing counties in Montana. But after a miscalculation error was discovered by the Montana Department of Revenue (DOR), city, county, and school district officials were surprised to find out that they were going to see less money coming in from previous years from newly built properties.
“That is a substantial drop for one of the fastest-growing cities in the state. And it makes our heads scratch a little bit,” says Neil Cardwell, Belgrade City Manager.
Cardwell says the City of Belgrade saw a double-digit reduction in tax revenue.
“We saw a 15.5% reduction from last year's newly taxable property values,” says Cardwell.
In a letter sent to officials in Gallatin County, DOR cites several factors for the tax revenue decrease, including the large amount of appeals homeowners from the county made.
The appeals process left the Department Of Revenue with insufficient time to assess new construction.
“The Department of Revenue was unable to get to assessing and evaluating all of those new properties,” says Cardwell.
Cardwell says the effect of the tax revenue deficit on Belgrade would mean not being able to hire more police officers.
“We’re looking at about a $130,000 shortfall. And that right now particularly impacts areas and like public safety,” says Cardwell.
City and county officials expecting to see an increase in tax revenue were surprised when they received notice of a decrease.
“All of the local governments and school districts and everybody have been in this pattern of assuming growth in our mill value because that's been the way it's been going the last decade,” says Gallatin County Commissioner Zach Brown.
“Belgrade’s perspective—and we even brought up that we don’t believe this was a single-year event—that going back the last three to five years and looking at our newly taxable value, it's dropped as we've continued to grow,” says Cardwell.
Bozeman School District Superintendent Casey Bertram says they were in the middle of their budget talks when they learned of the revenue shortfall, causing them to halt levy considerations.
“We didn't set the mills associated with that, knowing that the mill, based on the taxable value is incorrect at this point,” says Bertram.
Leaders say they're hopeful to work with DOR to make sure that Gallatin County residents are paying the accurate amount of property taxes.
“Frankly, there probably are a number of taxpayers who already overpaid. But I don't think there's a way to go backwards at this,” says Brown.
“Current taxpayers, if nothing changes, would pay more than they should. And that's, that's not acceptable to us, to our elected officials, to our taxpayers,” says Bertram.
We reached out to the Department of Revenue for comment but have not heard back.
