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Bill to cap county tax growth for school funding draws sharp warnings from school boards
Summary
Senate Bill 102 would limit growth in county‑collected property tax revenue for basic school funding to prior year plus 3%; proponents described it as a check on 'bill shock' from reappraisals, while school‑funding advocates warned of a projected $40–$43 million shortfall beginning in FY 2028.
Senator Becky Beard opened a hearing on Senate Bill 102, which would cap the levy calculated by the Department of Revenue so it may not generate more property tax revenue for certain school funding and vo‑tech accounts than the prior year plus 3%. "Our voters in the state have been clamoring to impress upon us that they need a reduction in their property tax bills," Beard said in her introduction.
Proponents argued the measure reduces volatility from reappraisals and prevents sudden ‘bill shock’ for taxpayers. Bob Story of the Montana Taxpayers Association presented historical revenue charts and noted that recent reappraisals generated a large one‑time revenue increase on the 95 mills, which he said the bill would smooth by limiting growth to 3% per year.
Opponents from the education sector, represented by Lance Melton of the Montana School Boards Association and the Coalition of Advocates for Montana’s Public Schools, said the 95‑mill structure helps equalize funding across districts and that freezing or capping the growth base would shift revenue burdens to local variable mills. Melton warned the change would cause an estimated $40–$43 million shortfall for school funding beginning in fiscal year 2028 unless the state adjusted other funding mechanisms. "Starting in fiscal year 28, you're gonna lose $43,000,000," he said, explaining his modeling to the committee.
Department of Revenue staff said the department prepared fiscal calculations but the printed fiscal note was delayed; they confirmed the fiscal note should be available before executive action. Multiple senators asked detailed questions about how the change would interact with the state’s equalization mechanisms, the bond‑subsidy account and how different counties would be affected by the frozen base.
Amanda Curtis, president of the Montana Federation of Public Employees, registered opposition and said the union stands with school employees who view the bill as a threat to school resources.
Senator Beard closed the hearing and requested a due‑pass, describing SB 102 as a ‘‘sensible safeguard’’ to limit unexpected increases to property taxpayers. The committee did not take a formal vote; the record indicates the fiscal note will be provided prior to executive action.
The committee instructed staff to prepare amendments as needed before scheduled executive action.
