Montana Department of Revenue briefs Kalispell commission on property‑tax basics and local impacts

Dawn Cordone, an appraiser with the Montana Department of Revenue, presented an overview of property appraisal and taxation at the Feb. 11 meeting and explained how valuation, legislative classification and local mill levies together determine taxable value and tax bills.

Cordone described the three core components of property taxation: market valuation performed by the Department of Revenue, statutory classifications and tax rates set by the State Legislature, and mill levies set by local taxing jurisdictions. She emphasized that valuations are market‑based, rely on accurate property characteristics, and generally reflect past sales; as a result, new construction is typically not added to tax rolls until the following year unless percent‑complete rules apply. Montana performs reappraisal on a two‑year cycle, which can cause perceptible lag between development and taxation.

Cordone discussed classification and tax‑rate differences by use. She noted residential property in Montana generally uses a lower tax rate (she referenced 1.35% in examples) while commercial properties are taxed at a different statutory rate (she referenced about 1.89% in an example). She said multifamily rental properties are treated for tax‑rate purposes as residential but are appraised using income approaches and therefore sit at an intersection of appraisal method and residential tax classification.

Using statewide and Flathead County examples, Cordone said residential property represents a large share of Flathead County’s tax base (she cited roughly 76% of the county tax base), meaning shifts in residential values affect the distribution of tax burdens among property classes. She urged officials to consider mixed‑use development as one way to diversify the tax base so that residential owners do not absorb disproportionate tax increases.

Cordone also warned that mill levies are set by jurisdictions to meet budgets and are a moving factor: when jurisdictions raise levies to cover inflation or budget needs, taxpayers can see increases even if valuations do not change. She pointed commissioners to Department of Revenue online certification tables and county certification summaries for specific county valuation data.

Ending: Cordone offered to provide follow‑up county certification data and encouraged planning staff to consult DOR materials when forecasting tax revenues and reviewing annexation or large development proposals.