Residents air property tax concerns

It was a letter he received from an 82-year-old East Shore widow that convinced state Rep. Scott Reichner, R-Bigfork, that something needed to be done about the recent property tax reappraisals.

Her property was worth nearly $500,000 in 2002, but the current reappraisal shows it at $2.7 million. With a fixed income, she is afraid she is going to be taxed off of the property she has lived on for 60 years, Reichner said.

"Morally, that's not right," Reichner said. "She's one of maybe two or three dozen. That's why I've called this meeting."

Reichner along with other area Republican legislators held a town hall meeting Thursday, Nov. 19, in Bigfork to give residents a chance to air their concerns.

"We want to hear your beef," Reichner said. "More important, I'd like to hear your solutions."

The majority of the people at Thursday's meeting were facing similar situations to the woman who inspired it – most had seen their property assessments skyrocket, had concerns about paying their taxes and were over 60 years old.

Though many were from the Bigfork area, the roughly 100 people present in the Bigfork Elementary and Middle School cafeteria had addresses across Flathead and Lake counties.

"I do believe the state of Montana would like us to stay in our homes," Judy Pettinato of Whitefish said. "We need to do everything we can."

Every six years, the Montana Department of Revenue is required to reappraise properties for tax purposes. Property taxes are used to fund education, local government and other services in the state.

The most recent reappraisal cycle ran from Jan. 1, 2002, through July 1, 2008, which some say doesn't take into account the decline in area property values.

The peak year locally for home values was in 2007. Since then, prices have continued to drop.

Cycles usually end on Jan. 1, but this time it was extended to account for changes in the market, Scott Williams, regional manager of the Department of Revenue, told residents at the meeting.

However, this most recent reappraisal cycle still significantly raised taxable property values in Flathead and Lake counties, especially for those with lake front property.

Williams said he recognizes there were problems with some of these property evaluations, but also pointed out that the worth of lake front property has also increased significantly.

For residents who have owned and lived on their property for several years, some of these values still seem outlandish and more than the properties could be sold for on the market.

"I'd take what you think my property is worth if you'd give me cash for it today," Bigfork area resident Ivan Barnes said.

This concern has also been reflected in the roughly 7,500 informal reviews filed with the local Department of Revenue office. Williams told those present that his office is still working to get those back to residents. After that process, those still unhappy with the result will have a chance to file an appeal with the County Tax Appeal Board.

The larger concern for many residents, however, is how much those assessment values will increase the amount they have to pay annually in taxes.

Pettinato said she is frustrated by how much she will be paying in taxes after six years. The amount will increase from about $4,100 to nearly $13,300 by 2014, she said. Residents can use an online tax calculator on the Department of Revenue Web site, http://mt.gov/revenue, to figure out their future property taxes.

"How many citizens don't know this figure?" Pettinato said. "This should be transparent."

To many residents present, this increase was just another sign that the property tax system as a whole needs to be re-examined.

"To me, property tax is one of the critical things that needs reformed," Bigfork area resident Edd Blackler said. "We cannot continue to support education on the backs of property owners. I think what needs to happen is more meetings to come up with plans to forward to the legislature."

Residents at the meeting suggested solutions that included a cap on taxes after age 65, a minimum state property tax, only cost of living increases, a flat tax, taxes based on acquisition prices or eliminating taxes completely.

At least two individuals said they were working with others to move forward on class action lawsuits. Dud Mahler said a group out of Whitefish is in the process of hiring an attorney.

Reichner said residents will need a three-pronged approach to address the issue – encouraging action by legislators, working on a possible ballot initiative and pursuing a class-action lawsuit.

The key to any solution will be finding common ground with Eastern Montana peers. Roughly seven or eight counties have been effected negatively by the reassessments and many are in the Western half of the state, Reichner said.

"We are willing to go to bat and change the law," he said. "We are willing to present to the governor and ask for a special session. Whether or not it goes is another thing."

Seeing the audience filled mostly with senior citizens has made Reichner more interested in finding solutions.

"I came away feeling more passionate about it," he said.

Reichner said he wants to continue the momentum from Thursday's meeting by holding a second town hall meeting from 6:30 p.m. to 8:30 p.m. Dec. 10 at Flathead Valley Community College.

"We know for sure it's a Bigfork issue, but is it a Flathead County issue? We'll see how many people show up," Reichner said.