County to consider tax recertification for Calumet valuation drop to keep GFPS budget whole

Updated 3:30 p.m. Oct. 19

Cascade County Commissioners are scheduled to hold a special meeting at 8 a.m. Oct. 21 to consider a request from Great Falls Public Schools to recertify their property tax valuations.

The county, GFPS and City of Great Falls already set their budgets in August and September, based on the taxable valuations from the Montana Department of Revenue that are finalized in August.

County approves budget with $12 annual tax increase; will set mills for other districts on Sept. 8 including special levy to recoup Calumet protested taxes

In October, the DoR told GFPS that they had reevaluated Calumet’s valuation, based on a complaint from the refinery that it was too high.

Jason Slead, spokesman for the DoR said that the department sent the change in valuation notification to the county on Oct. 4 about the decrease in taxable value from what was originally certified in August, as well as the county’s ability to recertify their taxable values.

Brian Patrick, GFPS’ director of business operations, said that though the 2020 settlement had precluded Calumet from protesting their taxes for three years, the DoR agreed to reevaluate the refinery’s value, and reduced it by $2.14 million.

According to Jason Slead, spokesman for the DoR said that Calumet wasn’t precluded from appealing their 2021 values, but agreed in the settlement to waive further appeals for the settled 2017-2020 appealed tax years.

Slead said that Calumet filed a Form AB-26 with the DoR for their 2021 appraised market value. The form is a request for informal review and classification and is available to all taxpayers.

Because the GFPS budget is already set and the way school funding is calculated, that would mean a loss of $518,000 for the district, without action from the county.

GFPS is asking the county to recertify the taxable value to account for the $2.14 million that’s no longer included, which means, if the county approves, the taxable valuation will remain the same and the tax burden will be shifted to the rest of the taxpayers, Patrick said.

According to his calculations, that means an additional $5.24 annually on a house valued at $100,000; an additional $7.85 on a house valued at $150,000; and an additional $10.47 on a house valued at $200,000.

Taxes for the district were set to be lower this year since the overall taxable valuation in the county had increased, but with the Calumet change, it’s only an overall increase of 0.27 mills, Patrick said.

Patrick said that when the budget was finalized in August, the owner of a home with a taxable valuation had the taxes decrease by $9.42 for the year. With the Calumet adjustment, if approved by the county, the taxes increase by $10.47, which is a net increase of $1.05 over the previous year. That’s 0.0875 cents per months on a $200,000 house, or half that on a house with a $100,000 taxable valuation, Patrick said.

Slead said that the reason for the reduction in market value was primarily due to the “costs, hazards and risks of litigation. Complex cases like this can take years to resolve and this keeps protested taxes tied up for that same amount of time.”

Calumet received its assessment notice around July 13, Slead said, and under the state rules, taxpayers have 30 days to file the form requesting an informal review. The DoR is required to certify values to the taxing jurisdiction by the first Monday in August.

Calumet and DoR met on Sept. 8 for the informal review, Slead said, and the company presented additional information for consideration, after which, the two parties came to an agreement as to the market value of the property.

In May 2020, Calumet and DoR settled a tax appeal from 2017.

The county tax appeal board voted in March 2018 to reduce Calumet’s valuation from $538 million to $312.5 million.

Dept. of Revenue files appeal over Calumet taxes

That decision was been appealed by both Calumet and the Montana Department of Revenue to the Montana Tax Appeal Board. A hearing is set for Feb. 19, 2020 and then rescheduled for September, but Calumet and DoR have settled.

According to the DoR, of the roughly $17 million paid by Calumet under protest for tax years 2017-2019, about $9.5 million was released to the local jurisdictions and $1.5 million to the state.

In the 2020-2021 budget, Cascade County included 13.59 in special mills for the school district to recoup $1.939 million lost to the Calumet tax protest.

The Calumet tax appeal process took three years and for the first two years, the Great Falls Public Schools district accessed those protested taxes to make their budget whole.

“Without those funds, there would have been emergency cuts on top of cuts that had been happening for 10 years,” Patrick said.

GPPS to access protested taxes for operations

The district budget is done on a cash basis by enrollment and other factors in the state formula and without those funds, the district would have been short $2.5 million in the first year and $1.3 million in the second year, Patrick told The Electric last year.