BEFORE THE Department of REVENUE

OF THE STATE OF MONTANA

 

In the matter of the adoption of New Rule I and the amendment of ARM 42.20.102 pertaining to property tax exemption process revisions

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NOTICE OF ADOPTION AND AMENDMENT

 

TO: All Concerned Persons

 

1. On July 22, 2022, the Department of Revenue published MAR Notice No. 42-1054 pertaining to the public hearing on the proposed adoption and amendment of the above-stated rules at page 1274 of the 2022 Montana Administrative Register, Issue Number 14.

 

2. On August 15, 2022, the department held a public hearing to consider the proposed adoption and amendment. The only attendee at the hearing was Robert Story, Executive Director of the Montana Taxpayers Association.  The department also received written comments from Troy Lindquist, CPA.

 

3. The department has amended ARM 42.20.102 as proposed.

 

4. The department has adopted New Rule I (42.20.102A) as proposed but with the following changes from the original proposal, new matter underlined, deleted matter interlined:

 

NEW RULE I (42.20.102A)  ADDITIONAL DOCUMENTATION REQUIREMENTS FOR PROPERTY TAX EXEMPTION APPLICATIONS

(1) remains as proposed. 

(2) For property used for religious purposes:

(a) remains as proposed.

(b) proof that the church's land parcel does not exceed 15 acres or one acre for a clergy residence when if the land and improvements are used for educational or youth recreational activities, and are available for public use; and

(c) through (18) remain as proposed.

 

AUTH: 15-1-201, MCA

IMP: 15-6-201, 15-6-203, 15-6-209, 15-6-221, 15-6-235, MCA

 

5. The department has thoroughly considered the comments and testimony received. A summary of the comments received and the department's responses are as follows:

 

COMMENT 1: Mr. Story provided commentary in support of the rulemaking because it clarifies and improves the property tax exemption application process. Mr. Story also commended the department for its inclusion of examples in its administrative rules because the examples should provide relatable information that fit most taxpayer scenarios.

 

RESPONSE 1: The department thanks Mr. Story for his valuable input to this rulemaking.

 

COMMENT 2: Mr. Lindquist provided commentary in support of the rulemaking and cleaning up the property tax exemption application process related to the Governor's Red Tape Relief Initiative. Mr. Lindquist also provided suggestions for amendment to New Rule I(2)(a), (b), and (c), and (5)(a), upon adoption, to substitute the word "proof" with "provide documentation."

Mr. Lindquist also suggested a revision to New Rule I(2)(b) which, in his opinion, more closely aligns with what is provided in 15-6-201(1)(b), MCA.

 

RESPONSE 2: The department thanks Mr. Lindquist for his valuable input to this rulemaking.

Mr. Lindquist's requests are well taken, but the department's use of the word "proof" in New Rule I(2)(a), (b), and (c), and (5)(a) is intended to make it easier for the applicant of the exemption to satisfy the requirements of the rule. While the department believes that it is in agreement with Mr. Lindquist as to the substantive requirements of the rule, the differences amount to semantics and the department is not compelled to revise the rule.

As for Mr. Lindquist's opinion that New Rule I(2)(b) should be amended to replace the word "when" with "if" because that is what is provided in 15-6-201(1)(b), MCA, the department responds that both fulfill the conditional connection of the stated requirement and the difference amounts to semantics; however, the department has revised the rule in response to the comment.

 

 

/s/ Todd Olson                                              /s/ Brendan Beatty                                      

Todd Olson                                                   Brendan Beatty

Rule Reviewer                                              Director of Revenue

 

Certified to the Secretary of State September 13, 2022.