Montana Senate Unanimously Passes Property Tax Bill to Credit Residential Payers

Senate Bill 90 takes money tourists spend and credits it to property taxpayers

By Keila Szpaller for the Daily Montanan

alanharder.ca, CC BY 2.0 <https://creativecommons.org/licenses/by/2.0>, via Wikimedia Commons

In an outcome that surprised even the sponsor, senators voted unanimously Wednesday to support a bill that takes $56 million paid by tourists and returns it to property taxpayers.

Senator Carl Glimm, R-Kila, sponsored Senate Bill 90 and said he believes the unanimous support indicates the strong appetite this session for property tax relief, although he said he wasn’t expecting to get approval from all 50 senators.

“This is what people sent us here to do, was to fix property taxes,” Glimm said.

The rationale for Senate Bill 90, sponsored by Senator Carl Glimm, R-Kila. (Provided by the Montana Legislature)

The bill was harshly criticized in its original form in committee because it took money from programs that support specific culture and tourism activities, but the committee amended it so the dollars come out of the general fund instead.

The committee also reduced the amount of money going to residential property taxpayers. A fiscal note said the $56 million would come from the 75% of the lodging and rental taxes that goes into the general fund.

“With my bill, tourists would be helping pay for things like road infrastructure by taking some of that burden off property taxpayers. And the traveling Montana soccer mom paying the lodging tax at a hotel would get her money back, and much more, via property tax relief,” Glimm said in a statement.

The bill will go to the Finance and Claims committee, where it will be considered alongside other proposals, but Glimm agreed the unanimous vote from the Senate, which has 32 Republicans and 18 Democrats, should lend it weight there.

Before the Senate approved it, President Matt Regier, R-Kalispell, successfully proposed an amendment to have the bill apply only to homes worth less than $1 million. It passed with 45 votes and just five Democrats against it.

“Senate Republicans are focused on providing property tax relief to people across the state,” Regier said in a statement. “I look forward to advancing SB 90 and other bills that create a fairer and more effective tax system in Montana.”

Senator Mary Ann Dunwell, D-Helena, supported the bill, but she opposed the amendment because of escalating home values.

“You don’t have to look far to find a home in certain housing markets that’s over $1 million,” Dunwell said.

Glimm said the amendment meant the amount of average money to be credited to property taxpayers would increase some from an estimated $236 prior to the change. A precise amount was not immediately available.

Property tax reduction is a bipartisan priority for the Montana Legislature this session, although different legislators have different ideas about the best way to make it happen. Several proposals advanced this week in both chambers.

Glimm said the amount to be credited in SB 90 used to be even more, an estimated $400 before the bill was amended. In support of the bill, he said the session started with a surplus of some $2.3 billion.

“Just let that sink in because that’s a lot of money,” Glimm said.

Senator Dave Fern, D-Whitefish, described a couple of proposals heard Wednesday as “audacious,” including SB 90. He said he knows that Montanans like collecting money from visitors because he represents a couple of tourist communities.

“What I like about this bill is it’s predictable. It doesn’t really need modeling,” Fern said.

Some bills can affect counties differently based on the industries and residential payers that make up their tax bases, and number crunchers “model” those impacts so legislators can see if the effects are disproportionate.

Dunwell said the fiscal note is “a little steep,” but she said the residential taxpayers paid $80 million more than they should have each year of the most recent biennium because of inequities among classes of taxpayers, and the state kept it.

“Those taxpayers shouldn’t have had to pay that. This helps give some of it back,” Dunwell said.

With some bills, Glimm said people talk about winners and losers, but this one is different.

“Everybody is a winner here.”