How are Property Taxes Determined?

 There are 3 main types of levies allowed in Montana.  The type of levy defines how many mills can be charged annually.

  1. Non-Voted (Floating) Mill – Annual Mills capped by revenue restrictions.  See explanation below.

2.     Permissive Mills – Annual Mills allowed by Montana state law to be levied for specific purposes to raise needed funds (Permissive medical levy and some school levies, for example).  In the 2017 legislative year, the state created or allowed a higher level of permissive levies for the schools to allow for more local control.  This has had a large impact on everyone regardless of changes in taxable value, and that is expected to continue.

  1. Voted $ or Mills – Taxpayer voted mills or fixed dollars (Library voted levy, etc). 

 In addition, there are assessments charged for living in a particular district or for services such as Refuse.

 The Montana Department of Revenue contains information about property taxes in Montana.  The following links provide detailed information, and the Certification of Values information is repeated here for the “Non-Voted or Floating Mill Calculation”.

  1. Montana Department of Revenue Property Tax Overview
  2. My Personal Property Information  - Resource for personal property tax information
  3. Property Assessment Cycle – Resource for Annual Schedule
  4. Detailed Certified Values For Each County – Resource for Park County Market and Taxable Values broken out by County, City and Agencies.  Multiple years are available for download.


Floating Mill Calculation for Non-Voted Levies

Certification of Values – Example of Floating Mill Calculation (Floating for Inflation and new property)

Every year, the Property Assessment Division provides the total taxable value of property to each taxing jurisdiction by the first Monday in August. The certified values include all classes of property within the boundaries of a taxing jurisdiction. These values are very important because the jurisdictions use them to calculate the amount of mills they can levy.

The formula for calculating mills involves increasing the prior year’s budget by one-half of the inflation from the previous three years. This is the new budget used to calculate the amount of mills. In order to find the number of mills needed, the new budget is divided by the current year’s certified taxable value and the result is multiplied by 1,000. If, for example, the prior year’s budget for a jurisdiction was $1 million, the previous three year’s inflation was 2% and the current year’s taxable value was $2 million, the calculation without newly taxable would be:

( ( 1,000,000 * ( 1 + ( .5 * .02 ) ) ) / 2,000,000 ) * 1,000 = 505 Maximum Mills

When we insert the newly taxable value into the formula, it will be subtracted from the current year’s taxable value. If the $2 million of taxable value included $100,000 of newly taxable value, the new maximum amount of mills would be:

 ( ( 1,000,000 * ( 1 + ( .5 * .02 ) ) ) / ( 2,000,000 – 100,000) ) * 1,000 = 531 Maximum Mills

The jurisdiction is now allowed to levy a maximum of 531 mills against the property within its boundaries.

The amount of annual taxes paid on property is equal to the taxable value of the property multiplied by the cumulative mills from all taxing jurisdictions in which the property resides.

Property Tax = Taxable Value x Jurisdiction Millage Rates

Capped Revenues = ($2,000,000/1,000)*531 Mills = $1,062,000

In Fiscal Year 2018, the Montana Department of Revenue Taxable Values for Park County increased 10%.  Park County’s 3% increase for the County Wide mill does not follow the taxable value totals because it is restricted by inflation and newly taxable property entering the tax rolls.  The allowable inflation factor is .82% for FY2019, one half of the average previous three year’s inflation based on CPI.

Park County Wide Revenues Cap Formula Example: See Park County FY2019 Budget  Page 198

 Using the Fiscal Year 2018 Tax Revenue figure of $3,689,014, Park County is limited to raising $3,846,455 in Fiscal Year 2019, or a 4% increase for the County Wide Levy (.82% inflation plus newly taxable property). 

***Other non-voted levies are calculated in a similar manner***

To see the Park County list of Levies and Assessments in Park County, see Park County FY2019 Budget Page 192 to 193