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Commission adopts resolutions to convert fixed mills to floating mills under new state law
Summary
The commission approved a resolution converting voter-approved fixed mills to floating mills as required by Montana law change, fixed the city tax levy for FY25–26, and staff explained rebate and tiered residential taxation implications for homeowners.
The Livingston City Commission on Tuesday approved a package of tax resolutions to implement changes required by recent Montana legislation that moves certain voter-approved fixed mill levies to a floating mill system.
City staff told the commission the change follows the 2025 state law that replaced fixed mills with a floating-mill approach and directs municipalities to use Montana Code Annotated, section 15-10-420, to compute levies. Staff explained that a floating system adjusts the mill rate to target a set revenue amount, while fixed mills kept a static mill rate so revenue rose or fell with property values.
"This year is the conversion point," a city official said, describing the state-mandated transition and noting the commission will use prior-year revenue and the state formula to set the floating mill. The commission approved Resolution 5167 to implement the conversion; the roll call vote showed all members present voting in favor.
Staff and commissioners discussed how the law treats inflation recognition and new construction. The state formula allows municipalities to recognize inflation adjustments (up to 4% under MCA 15-10-420), while the legislation concurrently reduced local recognition of the taxable value from new construction for some property classes. Staff said that mix could reduce revenue for growing cities while providing stability for others.
Finance staff outlined rebates and new valuation tiers for residential property; owners must file for a state rebate (the filing period opened the prior Friday) to secure a preferred tax rate and to avoid additional paperwork to claim owner-occupied status moving forward. Staff promised social-media and newsletter outreach to help residents file and said the Montana Department of Revenue is administering the rebate.
The commission also approved a separate resolution fixing the FY25–26 tax levy in response to the updated valuation figures and budget adopted earlier this summer; commissioners voted unanimously to adopt the levy.
Commissioners asked staff to continue reporting updates as the state revenue and valuation effects become clearer; staff noted the law's impacts vary across Montana and that Livingston's lower growth rate should limit extreme effects compared with faster-growing cities.
