A hearing regarding millions worth of protested taxes from Calumet Montana Refining has been pushed back to September.

The Montana Tax Appeal Board had been scheduled to hear the appeal in February, but city officials found out Jan. 27 that it had been pushed to September.

That continues to leave millions worth of tax revenue in limbo for the City of Great Falls, Cascade County and Great Falls Public Schools.

GPPS to access protested taxes for operations

City Manager Greg Doyon told City Commissioners during their priority setting meeting on Jan. 27 that the appeal had $3.9 million tied up in protested taxes for the city from 2018, 2019 and the first half of 2020 fiscal years.

Calumet protests taxes, county tax appeal board lowers taxable value by more than $200 million

The delay is a “bummer” from a financial perspective, Doyon said, since the protested taxes are impacting the city’s fund balance but that at some point, the state tax appeal board will make a determination and funds will be released to the local governmental entities.

City budget being developed, no new public safety officers included

Doyon cautioned commissioners to think strategically when that happens since it will be a one-time infusion of cash versus a steady funding stream that will come in annually.

In 2018, Calumet protested their 2017 taxable value.

Dept. of Revenue files appeal over Calumet taxes

The Montana Department of Revenue set their value at $538 million. In February 2018, the three-person county tax appeal board lowered the value to $312.5 million. Calumet had requested their value be lowered to $190.7 million.

Both Calumet and the DOR appealed that decision to the Montana Tax Appeal Board the following month.

The Montana Tax Appeal Board will issue a written decision after hearing the appeal.  Either party aggrieved by a decision of the Montana Tax Appeal Board may seek judicial review in Lewis and Clark County or in the judicial district in which the property is located. Judicial review must be sought within 60 days of the date of the decision of the Montana Tax Appeal Board. If granted, judicial review will not be an evidentiary hearing but will be based on the findings of fact issued in the Montana Tax Appeal Board decision, testing only the legal conclusions of that decision.

During a May 30, 2019 compensation board hearings, county budget officer Mary Embleton said that protested taxes to about $387,770 for the county’s share.

For the city during last summer’s budget discussions, the Calumet protest created a $2.1 million impact on city tax revenues and this year’s estimate is $1.1 million. The city’s finance director said then that the number would become more clear once the city received the second half of taxes for this fiscal year.

As of Jan. 27, it was an estimated $3.9 million for the city.

Both city and county officials have said it’s too risky to use those funds until the protest is settled, since they run the risk of having to pay it back depending on the outcome of the tax appeal board decision.

The Great Falls Public Schools district opted again last summer to access their protested taxes, which is allowable under state law.

Last year, the protested taxes amounted to about $2.5 million for GFPS.

Brian Patrick, director of business operations at GFPS, said last summer that the school budgets aren’t set based on mill values the way counties and cities are, but instead are based on numbers of students, teachers and buildings.

Without the protested taxes, Patrick said during the June 2019 meeting that the district wouldn’t be able to make bond payments.

Once the protest is settled, the district might have to pay back the protested taxes. But for school districts, state law allows a permissive levy to make up that money, Patrick said.

The money was budgeted, and without the request, wouldn’t be received in total.

“It’s money that we wouldn’t have to operate,” Patrick told the board last summer.