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July 17, 2006
Montana Homeowners Finally Get Their Due
Much is being made of the projected $500 million that Montana will soon have in the "bank". While it's been labeled a surplus, perhaps it is best considered a timely windfall for addressing persistent needs including property tax relief.
The Republican Party and the Governor are each proposing property tax breaks. When considering such proposals remain mindful that over the last 20 years state and federal legislators have successfully shifted taxes from corporations and ultra-wealthy people onto lower and middle-class wage earners. Nationwide, the oil industry is effectively taxed at just 11%, a sweet deal that amounted to tax saving for oil companies if $1.5 billion in 2000 and more than $10 billion since 1968. In Montana annual property taxes paid by out-of-state electricity producers were cut in half by 1999 Republican legislature.
The Republican's current proposal calls for more of the same by favoring large corporations and wealthy out-of-state homeowners. Four electrical energy companies would see their taxes reduced by $3.4 million annually, and 5 out-of-state homeowners alone (holding property with a median market value of $6.7 million) would see their taxes reduced by $38,000, or an average of $7,610 annually.
Most importantly, the Republican’s proposal would make these reductions permanent. Such permanence seems misguided and unacceptably liberal given other needs. Our corrections system is about to burst with methamphetamine addicts and Montana's public pension programs are headed for a $1 billion (or more) shortfall.
In sharp contrast, the Governor's proposal would provide a $400 rebate only to Montana homeowners. Large energy corporations and out-of-state homeowners would get zip. Most importantly, the Governor's proposal calls for a one-time rebate not a permanent tax break, thus retaining our ability to meet other future needs.
The Governor,s proposal recognizes two important facts that escaped the Republicans: 1) these uncertain times justify a measured and conservative approach to fiscal policy, and 2) it is time for lower and middle-class Montana homeowners to be favored by the state's fiscal policies rather than corporations and wealthy "out-of-staters".
Mike Phillips
Posted by admin at July 17, 2006 07:24 AM