Montana Administrative Register Notice 42-2-866 No. 23   12/08/2011    
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In the matter of the adoption of New Rule I (ARM 42.20.173), amendment of ARM 42.20.432, and repeal of ARM 42.20.172, relating to validating sales information and extension of statutory deadline for assessment reviews









TO:  All Concerned Persons


1.  On August 25, 2011, the department published MAR Notice No. 42-2-866 regarding the proposed adoption, amendment, and repeal of the above-stated rules at page 1646 of the 2011 Montana Administrative Register, issue no.16.


2.  A public hearing was held on September 19, 2011, to consider the proposed adoption, amendment, and repeal.  Ms. Nancy Schlepp, President of the Montana Taxpayers Association, appeared at the hearing and also provided written comments subsequent to the hearing.  Also appearing at the hearing was Joe Roberts, representing the Montana Association of Realtors.  Mr. Roberts stated he supported the comments provided by Ms. Schlepp.  Her comments are summarized as follows along with the response of the department:


COMMENT NO. 1:  Ms. Schlepp provided comments regarding the proposed amendments to ARM 42.20.432(3), stating that this is a clear misuse of the authority to implement administrative rules, and that the language being added here is language that Governor Schweitzer tried to amendatory veto into HB 333 and failed.

Ms. Schlepp also included the following quote from the Governor's veto letter to the Secretary of State: "I delivered to the Legislature an amendatory veto of HB 333 to require that distressed sales be considered when such sales comprised at least 20 percent of sales, consistent with industry standards, but the Legislature did not pass my proposed amendments.  I have now chosen to veto HB 333, as I believe the changes directed by the bill would diminish the fairness of our current property appraisal standards."

Ms. Schlepp added that even with the conversation between the Senate and the department having occurred, as referenced under the reasonable necessity for this proposed rule amendment, this is a legislative decision, not an administrative rule decision, and that the Montana Taxpayers Association opposes the changes and requests that the department reject and not adopt the proposed amendments to ARM 42.20.432.


RESPONSE NO. 1:  The department appreciates Ms. Schlepp's and Mr. Robert's interest in this rulemaking action.

The understanding between the department and the Senate Taxation Committee was for the department to proceed with implementing the IAAO distressed sale standard within the context of SB 295, L. 2011 and adopt or amend the rules to implement the required changes to the property tax appeals process.  New Rule I (ARM 42.20.173) is proposed by the department to follow-up on that understanding with the 2011 Senate Taxation Committee.  Although the IAAO standard was included in House Bill 333, which was proposed and failed before the 2011 Legislature, the department feels the intention of the discussions and agreement with the Senate Taxation Committee was to propose a rule to address this issue in any case.

The department does not believe that this rule represents a misuse of the department's authority.  As the Legislature may, through its rules review oversight process, step into this rulemaking action if the context of the rule were considered to be contrary to the legislative intent or interpreted incorrectly by the department.  To date, there has been no legislative intercession into the process, including the sponsor of Senate Bill 295, who served as the co-chairman of the 2011 Senate Taxation Committee and was fully informed of this proposed rule.


3.  Therefore, the department adopts New Rule I (42.20.173), amends ARM 42.20.432, and repeals ARM 42.20.172 as proposed.


4.  An electronic copy of this notice is available on the department's web site at www.revenue.mt.gov.  Locate "Legal Resources" in the left hand column, select the "Rules" link and view the options under the "Notice of Proposed Rulemaking" heading.  The department strives to make the electronic copy of this notice conform to the official version of the notice, as printed in the Montana Administrative Register, but advises all concerned persons that in the event of a discrepancy between the official printed text of the notice and the electronic version of the notice, only the official printed text will be considered.  In addition, although the department strives to keep its web site accessible at all times, concerned persons should be aware that the web site may be unavailable during some periods, due to system maintenance or technical problems.



/s/ Cleo Anderson                                        /s/ Dan R. Bucks

CLEO ANDERSON                                     DAN R. BUCKS

Rule Reviewer                                               Director of Revenue


Certified to Secretary of State November 28, 2011


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