Commissioner concerned about property tax halt on land being put in trust
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The Dec. 1 edition of the “Missoulian” included an article entitled, “Lake County Targets Tribal Tax Exemption.” This exemption, granted by the Montana Department of Revenue, halts collection of property taxes for a maximum of five years while properties purchased by the Confederated Salish and Kootenai Tribes move through the process of being placed into trust.
Lake County is asking for an injunction to halt the granting of any more of these exemptions by MDOR until problems in the processing of these exemptions are corrected by the MDOR. There were some points made in the article that could use further clarification and explanation.
CSKT spokesman Robert McDonald is quoted in the article saying the exemption “was adopted with overwhelming bipartisan support recognizing that one government didn’t want to tax another government while the wheels of the federal government slowly turned.” The bill did have significant support in Legislature, but the support was based on a flawed fiscal analysis that indicated the property tax loss to the County and state would be minimal.
The MDOR testified to legislators that they estimated the annual tax loss to be $15,650 statewide. Additionally, it was estimated by MDOR that there would be approximately 20 applications filed statewide. The projected numbers were significantly understated. In Lake County alone, during the first year of implementation, there were 80 applications filed and a tax loss of over $28,000. If accurate numbers had been supplied to legislators, many of them may not have supported the exemption.
Mr. McDonald also stated, “Lake County continues to focus its energy on fighting with tribes rather than trying to solve real problems.” The property tax loss, due to properties being improperly exempted, is a real problem to taxpayers in Lake County. Each exemption shifts the tax liability to the remaining taxpayers. Property tax increases of 50 percent or more in the last decade have occurred countywide. Many St. Ignatius school district residents will see tax bill increases of hundreds of dollars next year that will continue for 20 years to fund district infrastructure improvements. Many residents who pay property taxes from an escrow account have received letters from lenders stating that the contribution to the escrow account needs to be significantly increased to make sure there are sufficient dollars available to pay tax bills. Losing one’s property or being forced to sell because the taxes cannot be paid is a legitimate fear for many of our taxpayers.
Lake County is not interested in “fighting with the tribes,” and this legal action is taken against MDOR. The County would’ve liked to discuss the problems about the Temporary Tribal Exemption with CSKT Tribal Council prior to filing the injunction, but despite repeated attempts by the County to facilitate meetings, the Council has been unwilling to meet. Stating that the County focuses its energy on fighting with the tribes simply deflects attention away from the fact that the Council has shown no interest in meeting and talking about common issues.
