HomeMy WebLinkAbout08-22-23 City Commission Meeting Supplemental MaterialsPage | 1
FY24 Tax Levy (2023 Tax Year) Analysis for Resolution 5500
Background
Montana State Law allows local governments to levy three types of mills: all-purpose, permissive, and voted mills.
All-purpose mill levies are floating mills, which means the number of mills available to levy are not fixed. Local
governments are restricted by MCA 15-10-420 to collecting an amount equal to last year’s actual tax revenue collected,
plus ½ the average rate of inflation for the last three years, plus newly taxable value. This means that as appraised
values go up, allowable millage rates for all-purpose levies go down and local government tax bills to property owners
do not rise at the same rate as their appraised values.
Permissive mills are allowed by state law that are not subject to the limits in MCA 15-10-420. The City levies one levy
which is permissive for health/medical insurance for general government employees. The permissive levy for
health/medical insurance recommended for FY24 is 10.88 mills and is calculated subject to MCA 15-10-420(9).
Voted mill levies are approved by the voters for specific purposes. Most recently, Bozeman citizens approved a General
Obligation Bond to fund the Public Safety Center. Voted levies for debt service are calculated to recover the amount of
revenue needed to pay for the debt service on the outstanding bonds each year. Typically, debt service is a flat dollar
amount over the life of the loan, so the number of mills levied would decreases from year to year, as the mill value rises.
Voted levies can also be approved as a total number of mills.
Adopted Budget
The FY24 budget was approved by the City Commission via
Resolution 5486 on July 11, 2023, prior to the publication of
certified values for the tax year. The budget included estimated
mill values based on historical trends. However, Resolution 5500
recommends establishing and affixing mill values that are less
than those included in the adopted budget, due to higher than
anticipated increase in mill values. The estimated mill value
included in the budget was $190,436. The actual mill value is
$247,106.
Certified Values and Maximum Mill Levy
On August 1, 2023, the City received its official certification of
taxable values for FY24 (2023 tax year/calendar year), issued by
the Department of Revenue (DOR). The certification showed that
taxable value went up by 56.5%. The certification also showed an
increase of $13.5 million from new construction (newly taxable
property). The final certified values result in an actual mill value of
$247,106. Resolution 5500 proposes that the City Commission
levy a total of 150.72 mills city-wide. The General Fund all-purpose
levy, as provided by Sections 7-6-4451 and 15-10-420 MCA, is
proposed to be 93.02 mills of 105.13 total available as the maximum levy. Mill Levies have been reduced in this resolution
to generate the same amount of revenue included in the adopted budget. With approval of Resolution 5500, the City will
maintain its commitment of 9.0 floating mills being held back in alignment with Resolution No. 3954 (911 mills) and leaves
12.11 available floating General Fund mills unlevied.
All Purpose Levy:
General Fund 83.30
Community/Workforce Housing 5.89
City Planning 1.46
Senior Transportation 0.77
Story Mill Landfill Monitoring 1.60
Total All Purpose Levy 93.02
Permissive Levies:
Health/Medical Insurance 10.88
Total Permissive Levies 10.88
Voted Levies:
Fire Equiment 4.00
Fire Staffing 12.00
Police Staffing 14.00
Parks & Trails GO Bonds 4.49
Bozeman Public Safety Center Bonds 10.15
Fire Station #2 Relocation GO Bonds 2.18
Total Voted Levies:46.82
Grand Total Levied 150.72
Mill Levy Fiscal Year 2023-2024 (FY24)
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The charts below show the percentage change in taxable value city-wide, and the total property taxes levied through the
all-purpose property tax levy. Although taxable values increased by more than 55%, revenues to the City from all-purpose
property tax levies are expected to increase by only 8%.
*Denotes years of valuation. Montana valuates property every other year.
12.9%
3.3%
21.8%
3.3%
20.9%
3.0%
56.5%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
2018*2019 2020*2021 2022*2023 2024*
Percent Change in Taxable Value
14,338,536 15,192,508 16,567,749
13,767,060
16,675,179
20,623,353 21,842,278
-
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
2018 2019 2020 2021 2022 2023 2024
All Purpose Property Tax Revenues
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Tax Increment Financing Districts (TIFD)
Tax increment financing districts have also seen significant increases in incremental values. The additional revenue can be
used to fund projects within each respective district. Expenditures of additional revenue that was not anticipated when
the budget was adopted will require a budget amendment.
3,769,917 4,159,996 5,987,410 6,247,663 7,893,562 8,245,319
13,789,647
-
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
16,000,000
2018 2019 2020 2021 2022 2023 2024
Downtown TIFD
Base Value Incremental Value
223,765 229,047 457,274 477,252 636,368 660,471
1,382,658
-
500,000
1,000,000
1,500,000
2,000,000
2018 2019 2020 2021 2022 2023 2024
Northeast TIFD
Base Value Incremental Value
948,716 982,574 1,714,155 1,707,571 2,589,893 2,751,885
5,397,828
-
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
2018 2019 2020 2021 2022 2023 2024
Midtown TIFD
Base Value Incremental Value
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87,633
20,749 -13,824 53,750 37,133 85,307
-
50,000
100,000
150,000
200,000
250,000
300,000
350,000
2018 2019 2020 2021 2022 2023 2024
North Park TIFD
Base Value Incremental Value
56,410 56,410
98,233
-
20,000
40,000
60,000
80,000
100,000
120,000
2018 2019 2020 2021 2022 2023 2024
South Bozeman Technology TIFD
Base Value Incremental Value
255,655 315,388
1,128,947
-
500,000
1,000,000
1,500,000
2,000,000
2,500,000
2018 2019 2020 2021 2022 2023 2024
Pole Yard TIFD
Base Value Incremental Value