2 weeks Ago By VICTORIA EAVIS [email protected]
The Montana Legislature was packed with tight votes on tax bills this week, including a legislative committee that swiftly halted three major proposals from moving forward Wednesday. One senator said it was "the battle of the tax bills." The Senate Taxation Committee voted down a key Democrat-backed property tax relief bill and Gov.
Greg Gianforte’s priority income tax and property tax bills. The committee voted to table these bills, meaning they are not entirely dead but are not moving forward through the legislative process for the time being. In the Montana Legislature, no bills officially die until the body adjourns: The legislation can be taken off the table or the concepts can be worked into a different piece of legislation.
The sponsor of Gianforte’s preferred property tax legislation, Rep. Llew Jones, R-Conrad, called the vote Wednesday “no big deal.” He said some important amendments were not ready which contributed to it being voted down.
Jones’ would lower property taxes on primary residences, landlords with long-term rentals and tens of thousands of commercial businesses, while making up the lost tax revenue largely by increasing the tax burden on short-term rentals like Airbnbs and second homes. Over the last two years, Montanans have seen a dramatic spike in property taxes, averaging a jump of 21% statewide. Providing property tax relief is the Legislature's main task for this session, which is entering its final weeks.
Jones and Gianforte say the philosophy behind the approach is that out-of-state homeowners do not pay income taxes in Montana, but still benefit from things like hospitals and public safety agencies funded by state income taxes. Sen. Dave Fern, D-Whitefish, said Wednesday the concept of funding the rate cut through second homes and short-term rentals made sense to his constituents in Whitefish, a wealthy town that sees high tourist traffic.
He ultimately supported it for that reason, but called it “somewhat of a troubled bill.” This bill came as a recommendation from the governor’s Property Tax Task Force, which included Polson Republican Sen. Greg Hertz.
He chairs the Senate Taxation Committee and ultimately voted against the legislation Wednesday. “[The Property Tax Task Force was] looking at this bill and it looked like it might be the home run, but I'm no longer on that,” he said. The committee also tabled Fort Benton Republican Sen.
Josh Kassmier's the income tax cut bill backed by Gianforte that he held a rally in support of earlier this week. This legislation would cut the top income tax rate — which most Montana residents pay — from 5.9% to 4.
9% and lower the capital gains tax from 4.1% to 3.9%.
An individual Montanan whose income exceeds $20,500 annually currently pays 5.9%. To add to the tax bill chaos, Kassmier attempted to "blast" that bill back onto the floor, but that move failed in a resounding 18-32 vote.
A blast motion can happen on the floor when a bill is tabled in a committee, and if successful the bill will be revived and heard again on the floor. There are a slew of other income tax cut bills also moving through the Montana Legislature, including , R-Billings, that was voted down in committee and successfully blasted back onto the floor — all on Wednesday. Also Wednesday, the Senate Finance and Claims members voted in favor of In a narrow vote, the Senate Tax committee also put a major Democratic property tax bill on hold that would have granted a tax credit to homeowners and renters based on income.
is one of two headline property tax reform bills from the Democrats and is the party’s method of reaching renters whose landlords pass their rising property taxes onto their tenants by increasing their rent. Based on the income thresholds in the bill, the state estimated it would touch roughly 86,000 households in Montana and cost just shy of $100 million. Hertz, who briefly sported a suit jacket covered in $100 bills Wednesday, voted it down because there are a number of bills moving through the Legislature with hefty price tags.
Hertz said some of them will need to be picked off, but Sen. Mary Ann Dunwell, D-Helena, pushed back on that sentiment. “This is a true middle-class tax cut and it links property tax problems with an ability to pay,” she said.
“That’s what our budget is for, Mr. Chair: to help Montanans with the money they give us.” “I don’t disagree with you, Sen.
Dunwell,” Hertz responded. “A numbers game is where we’re at.” All these votes in the Senate Taxation Committee were happening on one of the busiest days of the legislative session as the House debated the state budget.
A property tax bill that was successful this week is which passed the House Appropriations Committee by one vote. This proposal is one of the simplest of the property tax reform bills: It slashes the rates of residential, agricultural and commercial property classes. That approach drums up concern from Democrats, Republican lobbyists and many others because it shifts the tax burden onto other classes of property.
This past weekend, a private email about two of these property tax bills emerged. The email, sent by Jones to lobbyists and obtained by the Montana State News Bureau, said legislators preferred that HB 528 become the major property tax reform bill over HB 231. That bore out in the votes this week.
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