The Montana Farm Bureau Federation (MFBF) and the Montana Taxpayer’s Association (Montax) appeared before the Montana Department of Revenue and Transportation Interim Committee (RATIC) April 29 and told members why they were forced to file a lawsuit against the Montana Department of Revenue (DOR) over their reappraisal of ag land in Montana.
Farm Bureau believes the DOR failed to correctly calculate phase-in amounts for agricultural properties statewide. The phase-in was supposed to be done over a six-year period but instead almost the full amount was taxed in the first year.
A class-action lawsuit against DOR was filed by MFBF and Montax Feb. 12. The lead plaintiff in the case was Bernie Lucas, a rancher from Meagher County, and Lucas Ranch, Inc., also of Meagher County. On April 5, the MFBF and Montax served Discovery Requests, and on April 9, the petitioners served Motion for Class Certification.
The DOR also appeared at the RATIC hearing Thursday in Helena and told the legislators that if the size of a parcel changed for any reason (such as a new map, county road right of way) the landowner does not get the benefit of their proposed “productivity only” correction. MFBF argued that all “changed” ag land should be phased in.
“This is crazy,” notes Jake Cummins, MFBF executive vice president. “In the example we gave the committee based on the facts in the Lucas case, Lucas paid tax of $54 per acre, but when the DOR changed the map boundaries to reduce a parcel by a half percent he paid $79 per acre.”
“Under the DOR Proposed Rule 2009 Phased in Value, Lucas’ taxes for the affected parcel are now 46 percent higher,” said Cummins. “That is a ridiculous increase for property taxes.”
DOR’s responses to discovery requests are due May 5. Farm Bureau is still urging landowners to pay their second half of their property taxes under protest through the AB-26 process until this is resolved.
A copy of the original petitions and additional court documents can be found on www.mfbf.org. Montax has posted a calculator at montax.org that can help taxpayers and county treasurers determine the amount to protest and MFBF has a link to that Web site.
Posted by Russell Nemetz
