Mineral County reduces school property tax mills

Mineral County Commissioners on Oct. 12 voted 2 to 1 to reduce the amount of state school property taxes it plans to collect, a move that falls in line with many other counties across the state.

The commission voted to reduce the mill levy from 95 mills to 77.9 mills for 2024.

“Income tax levels are basically controlled by the state, but property taxes are the authority of county commissioners,” explained Roman Zylawy, Mineral County Commissioner and former state president for Montana Association of Counties. “This is an opportunity to reduce property taxes and maintain services in terms of school equalization.”

The Montana Association of Counties has worked with both the Montana Department of Revenue and the Montana Taxpayers Association, along with outside legal counsel, to conclude that levying 77.89 mills is appropriate for school equalization for the next two fiscal years. The state had a $2 billion surplus in the general fund at the end of last fiscal year. Currently the surplus is estimated at $800 million.

If the 95 mills weren't capped, the state would receive an additional $80 million. By counties taxing at 77.89 mills, the state will receive $20 million in new money.

In a complaint filed this month in Missoula County District Court, the state said Missoula County told the Department of Revenue it would be levying fewer school mills than the state believes it should at 77.89 instead of 95 mills. The state is looking to have a judge declare how many mills it is required to levy for school equalization, according to the lawsuit.

School equalization means every tax jurisdiction ensures equal access to quality education for students, no matter if it has a high population or is more rural, as required by the state’s constitution.

The state of Montana claims it won’t be able to properly fund public education if Missoula County, and other counties who do not pay 95 mills, won’t collect enough money in property taxes.

Zylawy explained that the extra taxes from 77.9 to 95 mills goes to the state general fund, not to schools, because schools are already receiving funds through school equalization.

“They’re cutting a fat hog, as far as I’m concerned,” Zylawy said of the state government.

If the state comes back to sue Mineral County over the decision to reduce mills, Zylawy said the Montana Association of Counties will defend the county.

However, if the county pays the higher 95 mills and individual residents sue their county for overpayment, which is an individual decision and can become expensive for the applicant, MACo will not represent the county.

Mineral County Treasurer Merry Mueller has contacted other treasures in Montana in her own research.

“I feel that it would be easier for the county to adjust fiduciary responsibilities from choosing the 77.9 mills over the 95 mills if this went sideways,” she said.

By state law, the county must have tax invoices mailed out no later than Oct. 31. Knowing this, Mueller had preplanned.

“I updated all mills in all scenarios. Now I will run example bills to check accuracy and then send them to print. They will be out on time.”

Deputy County Mineral County Attorney Wally Congdon has followed this for years and said the lower mills are appropriate.

“Our commitment is taken care of at 77.9 mills,” he said. “Montana Code Annotated (MCA) 20-9-331 the State Equalization Aid Levy. MCA 20-9-333 County Elementary Equalization Levy, and MCA 90-2-360 the High School Equalization Levy and funded properly and legally by the county. The other 17.1 mills would go directly into the general fund of the state which could be used for who-knows-what? And this move lessens the burden on the taxpayers.”