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Engen: New Missoula budget to include property tax hikes

Downtown Missoula
Posted at 3:20 PM, Jun 29, 2022
and last updated 2022-06-30 10:17:31-04

MISSOULA - Missoula Mayor John Engen is calling this year a "hard year to budget for" as COVID-19 pandemic effects linger. The comment came during a presentation Wednesday to Missoula City Council members about the preliminary budget for the upcoming year.

Engen told the council that the state failed to expand legislation on resort tax — leaving property tax as the main source of funding. He noted this is not an easy budget cycle, as the city works to juggle unprecedented obstacles including inflation, cost of labor, and lack of tax increases during the pandemic.

Engen said a significant increase in property taxes can be expected, although how much is still unsure. He also noted the preliminary budget focuses on continuing the same level of service for city programs, including programs that were started during the pandemic.

The City of Missoula will also receive an additional $7 million in American Rescue Protection Act funds in Fiscal Year 2023, that officials say will be factored in. Officials explained the exact revenue for the current year won't be known until those figures come back from the state in August. At that point, the city will take a closer look and finalize the proposal.

Mayor Engen said he knows property tax increases will not be welcome news.

"We have held back as much as I'm comfortable with on the expense side. Because we have a state that has rejected the idea of a tourist tax that serves a few small cities very well in Montana, I have to rely on property taxes and fees to cover costs. Because I won't have the sense from the state until the first week of August, I can't provide you an exact number for growth today. But a tax increase is likely to be more than we've seen in my tenure as mayor.” - Missoula Mayor John Engen

Wednesday's presentation outlined a few priorities including achieving organizational excellence, providing access to quality housing, investing in community safety and wellness, and investing in the built and natural environment.

Examples of each of those priorities include city staff recruitment and retainment, purchasing land for development, supporting the police and fire departments, and continuing work on the Mullan BUILD project.

Some additional specific items are outlined on the city website. The public comment period on the budget will start on Aug. 15 before it goes to committee for final approval on Aug. 22. Updated information will be posted at throughout the summer.