By Ellen Thompson/Havre Daily News/ethompson@havredailynews.com
The Hill County Commission approved the 2004-2005 budget Monday and a 9 percent increase in property taxes.
For a home worth $80,000, the increase means $15 more in county taxes, with some variation depending on the fire district a house is in, and whether a house is within an incorporated city.
The amount of nontax revenue in this year's budget, which accounts for roughly two-thirds of the county budget, is the same overall as last year, after falling the year before.
This year's county budget is $11.35 million, of which $3.3 million will come from county property tax. Both numbers are up from last year's total budget of $10.97 million and tax revenue of $2.99 million. County property taxes increased 5 percent last year.
Increases in revenue from the Hill County Fairgrounds, the county parks and from the general fund allowed the commission to reduce the number of mills collected in those three areas. But those decreases were outweighed by tax increases for the District Court fund and the permissive insurance levy, as well as less significant increases in the bridge and weed control funds.
The increase in the number of mills levied this year is 10.3. A mill is equal to $1 for each $1,000 of taxable value.
Last year's increase was 16.4 mills, but the value of a mill rose this year because the taxable value of the county is up. The county commissioners said the taxable value rose by $247,275 to $26.7 million. The rise is due to new construction and oil and gas revenue, the commissioners' budget letter said.
"The slight increase (in the value of the mill) will not affect any budget decisions," Commissioner Pat Conway said.
But there is a tax hike and it has three causes. The majority of this year's increase, as it has been in recent years, is due to a 2.3 percent raise in the wages of county employees to keep up with the rising cost of living, Commissioner Doug Kaercher said.
One additional cause was a rise in the permissive insurance levy, a levy established by the state to cover increasing health insurance premiums and to give the state the ability to track rises in the premiums. A health fund tax is collected separately to cover health insurance for county employees, but the state sets a maximum for that tax, and the permissive insurance levy allows the county to make up the difference. The 9.05-mill increase in the permissive levy, reflects a rise in insurance premiums nationally, as well as disproportionately low numbers in years past, Kaercher said.
"This year we took a larger hit" in the area of insurance, Kaercher said. "This commission tried to be somewhat more conservative in years past and it caught up to us," he added.
Rather than increasing the permissive levy, the county had been funding the premiums increases out of a reserve fund.
"It brought our reserves down to a level that made us nervous," Kaercher said.
The county pays 100 percent of insurance premiums for its employees.
The third cause for this year's increase is new allotments for the District Court fund. Two years ago the state took over administrating district courts and juvenile probation in Montana. As a result, there was revenue left over in the local District Court budget, and in 2003-2004 a tax of only 0.1 mills was levied to cover other costs of the court.
However, the commissioners found they had made a miscalculation, Kaercher said. Though the state covered some of the District Court budget costs, other areas fell to the county. While the state covers juvenile probation, the county covers juvenile detention. While the state will pay for a mental health committal, the county must pay for the mental health assessments that lead to a committal.
Also, the clerk of court position is paid for by the county. The duties of the Clerk of Court's Office includes issuing marriage licenses, passports and adoption papers.
Finally, the county must pay medical costs for inmates in the detention center. All of these costs must be covered by the District Court fund, Kaercher said.
Last year's 0.1 mill for the District Court fund was down from 3.51 mills in the 2002-2003 budget. The levy this year is 5.7 mills.
"Last year's (low number) was a result of leftover funds and a misconception of what should have been allocated from that budget. This is high for this year, but should level out next year," Kaercher said.
The new budget includes $22,000 for new software for the sheriff's office and wages for an additional employee at the detention center.
The commission turned down Sheriff Greg Szudera's request for $60,000 for new patrol cars and new radio equipment.
This year was the first year in eight that the county saw an increase in its taxable valuation. Last year the county's taxable valuation was down $700,000 from the year before.
The valuation was $34 million in 1997. Part of the reason for the decrease was a reallotment of how much value the county could claim.
