Interim revenue panel hears gaps in special-district data and Cascade County residents' challenge to 45% solid-waste assessment

The Revenue Interim Committee on Monday reviewed how Montana's patchwork of special districts raise and report revenue, and heard public testimony alleging procedural failures in Cascade County that led to a court challenge.

Committee staff member Meghan Moore summarized the study of special districts, saying the state has roughly 40 statutory district types with widely varied financing methods and limits. "A majority of the districts, 23 total ... are allowed to choose among one or more financing methods," Moore told the committee, explaining methods range from taxable-value mill levies to per-parcel or per-unit fees and charges for services. She added that reporting is often delivered in PDF form to the Department of Administration and that "an audit is only required if annual revenue exceeds $1,000,000," a threshold met by only about 12% of districts in FY2024.

Moore warned that lack of consistent definitions, inconsistent fund coding and commingled reporting by cities and counties complicate efforts to assemble statewide data. She described the Department of Administration's project to compile FY2023-24 information and a change in reporting templates that should improve data collection beginning with FY2025.

During public comment, Mary Embleton of Cascade County recounted a multiyear dispute over the county's rural solid-waste special improvement district. Embleton described a February budget resolution that increased residential assessments by 45% without publishing required hearing notices; she said she paid the disputed assessment "under protest" and sued to void the resolution. "That 45% increase increased the revenues for just the assessments in the Solid Waste District from $1,100,000 to $1,665,850," she said. Embleton told the committee that after the county adopted further resolutions and a delayed public notice, the district court denied her petition but that on Dec. 16 the Montana Supreme Court "reversed and remanded the case back to the district court and ordered a hearing because they never did hear my petition."

Rae Grulkowski, who said she served as a county commissioner in 2024, echoed Embleton and urged the committee to consider options that give citizens more timely recourse short of litigation. "To date, this is a year over a year later, we've had no response," Grulkowski said, calling the delay "taxation without representation."

Committee members asked staff to follow up with additional stakeholders, explore whether more periodic audits or limited-scope audits could improve oversight, and consider stakeholder panels to inform any draft legislation. Several legislators noted the administrative cost of full audits for small districts and asked whether counties could include special-district revenues in broader county audits.

The committee did not take immediate legislative action but directed staff to continue data collection and to invite local officials and board members to testify in a future meeting. The committee also indicated interest in exploring statutory clarifications about notice and protest procedures for special-district rate changes.

What happens next: staff will return with more data and stakeholder input and the committee may consider draft bills or recommendations to boost transparency, audit frequency, or notice requirements.

Provenance: Topic starts at SEG 247 (Moore's special-district presentation) and public comment and Cascade County testimony run from SEG 945 through SEG 1619.