Agricultural Land Property Tax Lawsuit Continues


BOZEMAN — The Montana Farm Bureau Federation (MFBF) and the Montana Taxpayers Association (MONTAX) remain committed to move forward with their class action lawsuit against the Montana Department of Revenue (DOR) regarding improper implementation of the assessment of agricultural land.   Monday was the deadline for the DOR to respond to the lawsuit filed in the Montana Fourteenth Judicial District Court in Meagher County.  The lawsuit was filed as a result of the MFBF and MONTAX asserting that the DOR incorrectly calculated phase-in amounts for agricultural properties statewide and then failed to take action to fix the problem. Valuation changes due to the reappraisal are required to be phased-in over a six-year period under Montana statute.  However, under this new cycle nearly the entire change in valuation was assessed to taxpayers in the first year.

In its answer, the Montana DOR denies many of the specific allegations of the petition, but admitted it is correcting errors for some taxpayers in 2009, and will correct some of its errors for “all other affected taxpayers in tax year 2010.”

“How can the Department of Revenue in one instance deny wrong doing and then in the same document admit that it needs to be fixed?” asked MFBF Executive Vice President Jake Cummins.  “We feel we have a very strong case going forward. We still don’t feel this issue has been properly dealt with and plan to see it through until every piece of agricultural property in the state has been properly phased-in according to law and legislative intent.”

The DOR has publicly indicated that its erroneous phase-in calculations impacted at least 27,000 agricultural producers, and that only approximately 2,000 of those affected producers timely filed an AB-26 request for informal review. Unless corrected, the DOR’s error will result in the perpetuation of erroneous phase-in values through the remainder of the reappraisal cycle.

“It’s extremely frustrating to hear different solutions from the DOR in front of various venues over the past few months and still not have a viable and equitable resolution for these taxpayers,” added Mary Whittinghill, president, MONTAX.   “The failure of the DOR to initiate discussions with stakeholders or establish definitive timelines played an important part in our decision to file this petition.”

MFBF held Eastern Montana producer meetings March 29 and 30 in Sidney and Glendive on the tax lawsuit. Both meetings were well attended by farmers and ranchers concerned about being treated unfairly on their property taxes.

“The Montana Farm Bureau is still urging landowners to pay a portion of their second half property taxes under protest through the AB-26 process until this is resolved,” said Cummins. 

Whittinghill added, “Both our associations will continue to work closely with local governments to minimize confusion for all parties.”

A copy of the original petition can be found on the MFBF Web site at .  The petition was filed on Feb. 12.  The MONTAX is posting a new calculator on their Web site that taxpayers and county treasurers can use to help determine the amount to protest.  The MFBF website will link to the calculator for member convenience.

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