HELENA – Attorney General Steve Bullock, the Democratic nominee for governor, proposed Monday giving one-time property tax rebates of $400 apiece to Montana homeowners by taking $100 million from the state’s general fund surplus.
In his first proposal since winning the Democratic nomination last week, Bullock borrowed a page out of Democratic Gov. Brian Schweitzer’s playbook. Schweitzer successfully steered the $400-per-homeowner rebates through the Legislature in 2007.
“Montana’s fiscal management has left us in a better position than nearly any other state, and because of that, we can invest in our priorities and return money to taxpayers,” Bullock said.
His plan would use the $100 million from the state’s projected $400 million-plus general fund to pay for the rebates.
Under the plan, Montana homeowners could apply for a property tax rebate on their principal residences, but not second homes. Out-of-state owners of Montana homes would be ineligible. Renters would get no rebates.
Bullock said his top priority as governor will be to create jobs and grow Montana’s economy.
“Implementing this tax rebate will lead to millions of dollars being spent on Montana, being spent on Montana businesses,” he said at a news conference in downtown Helena. “If you’re an average Montana family and receive a $400 check, you’re going to take the kids out to dinner, put a down payment on a snowmobile, maybe buy some fencing.”
In response, Republican nominee Rick Hill criticized Bullock’s plan and called instead for permanent property tax relief for homeowners and small businesses. He estimated his plan would lower property taxes by $100 million annually on a permanent basis every year and not be a one-time $100 million rebate.
“Montanans and our job creators need permanent property tax relief, not a one-time gimmick that won’t do anything to stimulate the economy,” Hill said in a statement.
Hill advocated coming up with the money by using surplus state funds and future revenues from expanding oil and gas development to cut property taxes and change how Montana funds education. Another revenue source, Hill said, would be future lease and royalty income from the Otter Creek coal development. Although leased, no coal has been mined at Otter Creek yet, and environmental groups have challenged the Land Board’s decision to lease the state-owned coal.
“This is the first step in our long-term tax reform plan to shift education funding away from property taxes and on to natural resource reviews,” Hill said.
Bullock’s plan picked up the backing of businesswoman Shalon Hastings, who owns Taco del Sol, a Mexican restaurant in Helena.
“I would love to see this being implemented,” she said at the event. “It will mean so much for all of us small business owners here in the state of Montana. We’ll have more money to reinvest in our businesses and create more jobs, which in turn just creates a better economy for Montana.“
Bullock was asked why he didn’t instead propose using the $100 million to make up for cuts in human services and other programs the past two legislative sessions.
“What we’re proposing is a balanced approach,” he said. “This won’t be the be-all and end-all.“
Bullock said he later will propose “additional investments in education, infrastructure and other things.“
Schweitzer’s $400-per-homeowner rebate program proved to be a popular one in 2007.
The state Revenue Department said 238,524 Montana homeowners received rebates totaling $93.8 million. Ninety-eight percent of homeowners who applied for the program received the rebates.
The cost of administrating the program was slightly more than $1 million.
Missoulian State Bureau reporter Charles S. Johnson can be reached at (406) 447-4066 or at email@example.com.