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Senate Bill 117 would cap how much newly taxable value feeds local budgets and create reserve accounts, sponsors say
Summary
Sen. Daniel Zola Cobb told the committee SB 117 smooths inflation, caps newly taxable revenue (75% for residential class 4; 40% or 50% for other classes), and requires a 10% deposit into a large taxpayer reserve account to mitigate losses if major taxpayers leave; counties largely supported it while cities raised concerns about funding new housing and infrastructure.
Sen. Daniel Zola Cobb (Senate District 22) presented Senate Bill 117 on April 14 as a long-term rewrite of parts of Montana’s property-tax system aimed at slowing compounding growth in local budgets and returning more benefit to existing taxpayers. The bill would use a multi-year average of inflation (the prior three years, capped at 4%) for budget growth and would limit how much newly taxable value may increase local budgets: class 4 residential newly taxable would be capped at 75% while other property classes would be capped at either 40% or 50% depending on whether a jurisdiction creates a "large taxpayer reserve account" and meets deposit requirements.
Under the propo…
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