By Tim Leeds
Local officials told area legislators Monday that reductions in local taxes are causing problems providing services.
City, county and school district officials from Hill, Blaine, Choteau and Liberty counties met with all local legislators and legislative candidates in a forum sponsored by Sen. Jon Tester, D-Big Sandy. Tester sponsored the forum to collect input on the effects tax changes have had on local governments.
"We have stopped building roads; that's the impact," said Hill County Commissioner Kathy Bessette.
A concern common to all three groups of local officials was that reduction in revenue has reduced or prevented capital expenditures. Little or no new construction or purchases are possible, they said, and even maintenance is being stretched thin.
Bessette said the Hill County Road Department has shrunk to 16 employees, compared to 36 about 20 years ago.
Blaine County Commissioner Art Kleinjan said they have had to reduce in all areas to meet their budget. He said they have lost at least one person in every office.
Ric Floren of the Havre Public Schools said the loss in revenue is creating similar problems in the schools. He said almost all programs are required for school accreditation and can't be cut, but the quality is decreasing. He said schools might be using a math teacher with a minor in biology to replace a position that used to have a teacher with a master's in the field, and they might have only one section of a class where they used to have several.
nother common concern was that just about all single-use budget shifts have been made. If additional funds are lost, they said, local taxes will have to be increased or programs and services cut.
Recent changes in the tax codes during the 1999 Legislature and the special session held last spring have reduced revenue from some sources. The business equipment tax is scheduled to be reduced to zero percent in the future, and some agricultural taxes are being reduced. This has resulted in local governments across the state losing an average of about 15 percent of the worth of each mill levied.
Hill County Commissioner Pat Conway said the end result is the loss of nearly half of the taxable valuation in Hill County. He said that over the years the value has gone from about $49 million to about $29 million.
While the state is paying the local governments some of the revenue lost, it is not making up the entire difference in most cases. Most local governments have had to float additional mills to regain some of the loss.
Several county commissioners said they are upset that they are being forced to raise taxes in order to provide the same or even fewer services.
A major concern expressed by the local officials is that services are stretched about as thin as they can be stretched. There is a minimum cost to providing services, they said, and if funds are reduced further, services would have to be cut.
The only other alternative would be to raise local taxes further, they said.
Rick Morris of Fort Benton said that if the business equipment tax is reduced further, higher local taxes are the only option. He said most of the benefit from the tax reduction is going to large businesses, and if it is reduced further, local taxpayers will have to make up the difference.
All three groups, as well as some of the legislators, said the net effect of the tax reductions was no reduction at all. They said the effect was simply shifting the taxes from one area to another and forcing the local governments to implement the new taxes to provide services.