2023 late fall November

Taxes were the topic of our Local Government Interim Committee. Recent home reappraisals have shown significant increases. In some areas of the state, home sale prices have more than doubled. With folks moving in from out-of-state to places like Bozeman, the Flathead, and other areas, and bidding wars leading to properties at twice the asking price, the committee clearly has a number of challenges to address.

First off, locals cannot compete with the prices that Montana homes are reaching. The next issue is that our tax system is based on market value of housing, which means that the high housing prices are driving up everyone else’s residential taxes. This has caused a snowball effect. In the past, when there was a mill levy request, counties were able to estimate the tax burden for residents based on the house value. The system worked fairly well when prices were consistent. But with the wild swings we are seeing, counties are unable to accurately estimate the tax burden, and the Department of Revenue is having issues certifying values and getting the tax increase information back to the counties timely. Will taxes go up? Yes, in most cases, although most counties are mitigating some of the mill levies the state is asking for, which should hold taxes in check some.

Subsidized, low-income, and workforce housing is in short supply and the question is how much money the state should invest in solutions. Some folks feel private investors and builders will take care of the supply and demand. At this point, the state will spend $225 million on housing in the next couple of years. $175 million from the general fund, $50 million from the Montana Reinvestment Plan Account, $6 million from Workforce Housing incentives, $106 million from the Homes Revolving Loan Account, $12 million from the Board of Investments, and $50 million was authorized from the Coal Trust for Multifamily Homes Program, as well as $1 million from the Department of Commerce for planning. Some of these monies can be allocated to 503-Cs, cities, counties, and private investors. I feel if this money is used right, it should fill the large housing shortage we now have.

Judy and I plan to spend time with family for Thanksgiving. We are grateful for good roads and road maintenance for our travels and a decent weather forecast. I hope you, too, get to spend time with loved ones and eating delicious food.

As always stay safe!

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State Sen. Russ Tempel, R-Chester, can be emailed at [email protected] .