Annual Property Tax Changes

To help taxpayers better understand the changes in their property taxes, the department has published annualized rates of change in property tax for the major taxing jurisdictions in each county. This annualized rate of change is the amount of taxes collected in 2021 divided by the amount of taxes collected in 2012, divided into 10 years. For example, in Yellowstone County, the county collected $40.5 million in 2012 and $59.1 million in 2021. This is a total change of 46% over the 10-year period, which works out to annualized rate increase of 4.30%. This rate is reflected in the bar labeled “County” on the Yellowstone County chart.

These charts also include lines indicating average countywide growth in income and population plus inflation. These are common benchmarks used by economists to gauge ability to pay (income growth) and increased demand or cost of services (population plus inflation growth). In the Yellowstone County example, the income growth was 4.39% and population plus inflation growth was 2.80%.

Property taxes are levied in mills against the taxable value of the property. A mill is equal to 1/10 of a cent in value. A taxing jurisdiction is a governmental entity that has taxing authority over a property. The combination of taxing jurisdictions with authority over an individual property determines the total taxes paid. In a county, all properties pay the same mills to the county. If a taxpayer resides within city limits, they will also pay taxes to that city. Each property in the state is in an elementary school district and a high school district. Some counties have many districts, so the local schools column is an average of the various school districts within a county. Countywide transportation and retirement are mills paid by all property in a county towards bussing and the teacher’s retirement system. These mills are separate from the local school mills because they are assessed on a countywide basis. Finally, all property in the state pays state mills towards education equalization and to support the Montana University System.

These charts are informational and should not be considered as making value statements about the growth of property taxes. In general, taxpayers may be interested in how some taxing jurisdictions grow faster than others, and how that growth relates to the average growth in income or population and inflation.

For example, if a county has a strong natural resource extraction economy (oil and gas, metal mines, coal mines), then taxes associated with that industry help offset property taxes. Montana was experiencing an oil and gas boom in 2012 that has somewhat subsided since. Counties in the east such as Wibaux, Fallon, and Richland had extremely low property taxes in 2012 because of this oil and gas money. Although their percentage increase is large relative to most other counties, their total taxes paid remain relatively low because of this natural resource tax money.