Jennifer Patchen has lived in Seeley Lake most of her life. She was shocked when she opened a letter from the Montana Department of Revenue earlier this month.
“I was like ‘oh my god’” Patchen said. “I opened up that (letter) and seen (my taxes) and it was almost 100% more than last year’s.”
Patchen lives behind the elementary school and is not the only one getting shocking tax assessments. Across the Seeley-Swan area — and the rest of Montana — residents are receiving new property values from the state, which coincide with their local share of property taxes.
Most in the area are seeing 30-40% increases from the last appraisal year in 2021, according to Kevin Wetherell, a local real estate broker. Some have told the Pathfinder their increases are closer to 50-100%.
“It’s just been alarming,” Wetherell said. “To give such a steep increase all at once is a concern.”
Wetherell said the increase of property value has a good side and a bad side. The good side means homeowners have more equity in their properties. They have a higher level of qualified credit, he said, and if owners sell they can get more money.
This means that investing in land is more expensive. The average price of a home in the Seeley Lake area averaged around $588,000 in May, Wetherell said. In Condon the average home price reached a staggering $916,000.
The increase of property values means the state will collect around $81 million more from homeowners than last year, according to the Montana Department of Revenue.
Brian Schweitzer, a Democrat who was Montana’s Governor from 2005 to 2013 and a resident of Seeley, said the state made a mistake and should fix it. He said there was a letter sent by the Department of Revenue to Gov. Greg Gianforte last winter that warned of high home values if no intervention was made.
“Legislative leaders in both the house and senate need to meet with Gianforte and tell the public ‘look, taxes are complicated, and we made a mistake,’” Schweitzer said. “Then they can plan out the votes and what needs to get done, and form a special session to fix this.”
Republican State Sen. Greg Hertz, who chairs the senate taxation committee, said state taxes will likely increase by 7% for homeowners, but much of that increase can be covered by a rebate from the government.
“If you pay less than $6,000 in taxes, your rebate will cover the increase,” Hertz said. Residents must apply for the rebate and the return only covers primary residences. The total amount a taxpayer can get is $1,200.
Hertz disagreed with Schweitzer’s recommendation of calling a special session to lower taxes, arguing that the state’s rebate solution helps working class Montanans more than lowering all taxes.
“If we called a special session and did what Schweitzer wanted to, it would lower taxes for everything, including second homes,” Hertz said.
In the long run, both Hertz and Schweitzer agreed that property tax increases will be unsustainable. Instead, Hertz suggested the implementation of a separate state tax revenue, like a statewide sales tax, although he would not endorse the tax at the time.
Local taxes will also rise, but that depends on how mill adjustments are made in Missoula County. A Mill levy taxes $1 for every $1,000 in property value. Missoula County Commissioner Josh Slotnik told the Pathfinder that while property values are very high this year, it doesn’t mean the local taxes will match it.
“Property value does play a role, but it is just one piece of the calculation,” Slotnik said. “Whether they went up 30% or 100%, taxes should be raised at around the cost of inflation.”
In county government, Slotnik explained that the commissioners start the tax season by deciphering a proper budget. Then the government looks at how to fund the budget with mills, which are levied by the county and local agencies like the Seeley Lake Elementary District.
Mills passed by voters to fund specific services also increase taxes. Rob Smith, a Clearwater Junction resident and blogger, criticized the system that he said takes money from rural residents to fund urban projects.
“Why should I pay for the new Missoula Library if I don’t use it,” Smith said, adding that his property value increased by 50% this cycle. “It’s just a sense that we are tax mules for things we don’t care for.”
Slotnik noted that those voter approved mills, like Missoula Aging Services, are not going away. What might disappear are general fund mills, Slotnik said, because of the sheer increase of property value.
“Since the value of property is so much higher, we will likely not use all the mills that the state allows us to use,” Slotnik said. “That might be the first time ever in Missoula County that we use fewer mils compared to the past.”
Property taxes will still not be set for a few months. The County is currently in the budgeting process using estimated property value. By early fall a final report will be sent by the state of Montana that shows how much taxes the county can levy based on home values.
Before then, residents who disagree with their assessment can file a Request for Informal Classification and Appraisal review, known as form AB-26, within 30 days of receiving their new appraisal
Wetherell said that protesting one’s property appraisal could lower the value, but sometimes it increases the value more.
“The first thing that happens when you protest is an appraiser from the state comes and looks over your property,” Wetherell said. “If they notice something that wasn’t on the original appraisal, like a larger deck, then your value could actually increase.”
Doc Welter, who lives on the Clearwater River in the old Dogtown subdivision, said his property value more than tripled from the last assessment, but that is likely because he purchased the land from the state in 2021. Prior to that the land he lives in was under a lease by the state.
“Since we didn’t own it, I assumed our taxes would go up,” Welter said. “So perhaps it is fair, but it’s kinda weird.”
Since Welter retired in 2018, he will have to use more of his income. It’s a price he has to pay to live in the area, Welter said, but he’s willing to make it.
“I hope that they bury me here,” Welter said.
For Patchen, a stay-at-home mom with a husband who works as a trucker, their resources could be stressed by an increased property tax. She mentioned going to a Seeley Lake Community Council last month and heard the issue of taxes won’t let up without a long-term solution.
“What I see on this is that Seeley could save a lot by incorporating,” Patchen said, adding that law enforcement and the potential sewer system are also issues the community must address. “We’ll just have to figure it out.”
Reader Comments(0)