City taxes will go up for Havre property owners
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The Havre City Council on Monday approved a tax increase for the fiscal year that began July 1.
The amount of property tax mills will increase from 154.6 to 160.76.
The increase on a house with a taxable value of $50,000 would be about $7.
Lowell Swenson, city clerk and finance director, said city taxes are going up because the taxable value of all property in Havre has gone down. Because of the decrease in taxable value, the city had to increase the tax rate in order to raise the same amount of tax revenue.
"Our mills went up to make up for our taxable valuation," he said.
The total taxable value of property in Havre decreased from $8.03 million last year to about $7.87 million this year.
Swenson thinks part of the decrease can be attributed to tax cuts approved by state lawmakers.
"It's decreases in tax rates that were approved by the Legislature," he said. "Personal property tax rates have been reduced a couple of times."
Because tax rates on personal property were cut, the city had to raise taxes on real property to bring in the same amount of money, he said.
Cynthia Piearson, public information officer of the Montana Department of Revenue, said that may be part it, but that the decreased value of centrally assessed utility companies in Montana lowered the value of their property. Centrally assessed companies are those that have jurisdictions or property that cross county lines.
Sharon Ferguson, a tax appraisal specialist for the Department of Revenue, said the homestead exemption, which was passed by the 2001 Legislature, also affects Havre's budget. The new law exempts 31 percent of the value of a Montana home from taxation.
The city is also facing some increased expenses.
Swenson said the tax levied to cover comprehensive insurance jumped from last year's 4.86 mills to this year's 10.37.
The increase is a result of increased premiums the whole country is facing, Swenson said.
"Our property insurance went up 30 percent last year, probably stemming from 9/11," he said.
The tax increase adopted Monday is smaller than in recent years, Swenson said. The mill levy went up 10 mills last year and 14 mills in the previous year.
The total city budget is just over $11 million, including a general fund of $2.58 million. Last year's total budget was about $11.3 million, including a general fund of $2.49 million.
The Hill County Commission on Monday raised county taxes by 6.25 mills.