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HomeMy WebLinkAbout08-30-24 Correspondence - MT Dept of Revenue - Director Beatty Follow-up on August 20, 2024 Meeting GOVERNOR GREG GIANFORTE MONTANA DIRECTOR BRENDAN BEATTY DEPARTMENT OF REVENUE August 27, 2024 Bozeman City Commissioners 121 N Rouse Ave Bozeman MT 59715 Dear Bozeman City Commissioners, On behalf of the Montana Department of Revenue, I want to express our appreciation for meeting with me and Property Assessment Division Administrator Paula Gilbert on August 20 to clarify the reasons behind the decrease in taxable value for the 2024 tax year in Gallatin County and discuss how the agency plans to address the impact on your budget. As we discussed, and as included in a letter from Administrator Gilbert on August 15, 2024, there were several factors for this decrease, including: • First, errors from the 2023 reappraisal cycle valuations that the department identified and corrected; • Second, an initial adjustment of the Economic Condition Factor, which adjusts costs values based on the price houses are selling for in a specific neighborhood, resulted in lower values for these properties; and • Third, the impact of the significant volume of appeals on current taxable values in Gallatin County and Bozeman in the past year. As Administrator Gilbert described in her letter, "[The] department handled more than 3,700 appeals in the county and city. These appeals necessarily demanded members of our dedicated staff commit substantial time and resources to fully review the appeals and adjust them where appropriate. To address the spike in appeals in your jurisdiction, the department brought in appraisers from all over the state to assist with appeals. Even with redirecting appraisers to increase staffing for appeals in your jurisdiction, addressing the sheer volume of those appeals took approximately 10 months." MTRevenue.gov (406) 444-6900 TDD Montana Relay 711 Bozeman City Commissioners August 27, 2024 p. 2 Due to the department's 10-month commitment to addressing appeals, we were left with only two months to incorporate new construction or other newly taxable property, which was substantial. To address the impact to your community, I shared with you last week that the Department of Revenue has reassigned existing departmental resources to increase our ability to add newly taxable properties in Gallatin County as quickly as possible, which will permit us to recertify its value for tax year 2024. We are committed to using all the resources at our disposal to assess as many new or remodeled properties in the next month. This time will allow DOR to provide your jurisdictions with revised certified values by the end of September. Once we receive updated mill levy information, we will work together with the treasurer to prepare for tax billing as soon as possible. I appreciate your understanding and willingness to work with us through this matter. Should you have any f rher questions or require additional information, please do not fBeatty directly. Director Montana Department of Revenue Enclosure: August 15, 2024, Letter to Gallatin County MTRevenue.gov (406) 444-6900 TDD Montana Relay 711 AAk GOVERNOR GREG GIANFORTE MONTANA DIRECTOR BRENDAN BEATTY DEPARTMENT OF REVENUE Dear Gallatin County Commissioners, Subject: Taxable Value for the 2024 Tax Year I'm writing to clarify the reasons behind the decrease in the certified taxable value for the 2024 tax year compared to the 2023 tax year. Several factors contributed to this decrease, including errors from the 2023 reappraisal cycle valuations that the department identified and corrected. First, we recalculated the condominium valuation models and applied new values to affected condos in Gallatin County in the fall of 2023 prior to tax billing. Second, an initial adjustment of the Economic Condition Factor, which adjusts cost values based on the price houses are selling for in a specific neighborhood, resulted in lower values for these properties. We discovered both errors after 2023 Certification of Value. Accordingly, we made adjustments to ensure we valued all properties impacted fairly and equitably. Third and most importantly, the current taxable values are directly related to the significant volume of appeals we received in Gallatin County and Bozeman in the past year. Specifically, our department handled more than 3,700 appeals in the county and city. These appeals necessarily demanded members of our dedicated staff commit substantial time and resources to fully review the appeals and adjust them where appropriate. To address the spike in appeals in your jurisdiction, the department brought in appraisers from all over the state to assist with appeals. Even with redirecting appraisers to increase staffing for appeals in your jurisdiction, addressing the sheer volume of those appeals took approximately 10 months. As a result of that 10-month commitment, we were left with only two months to incorporate new construction which was substantial in yourjurisdiction, and which directly affects newly taxable values for taxing jurisdictions. This limited, two-month timeframe naturally impacted our staff's ability to fully capture all new construction for tax year 2024 prior to certification of values. The combination of adjusting values due to MTRevenue.gov (406) 444-6900 TDD Montana Relay 711