Provide for class of property for manufacturing for property tax purposes
Summary
HB 903 would create a new property tax classification, class nineteen, for land and improvements used for manufacturing, with certain exclusions for property already classified elsewhere. The bill defines manufacturing property broadly to include the mechanical, physical, or chemical transformation of materials into new products, as well as the assembly of component parts of manufactured products for non-construction purposes. If a parcel contains both manufacturing and other types of property, the land would be assigned to the class tied to the largest share of improvements on the parcel.
The bill sets the taxable percentage for class nineteen property at 1.47% of market value and makes the change applicable to property tax years beginning on or after January 1, 2026. It would be codified within Title 15, chapter 6, part 1, meaning it would operate within Montana’s existing property tax classification framework and affect how county assessors classify and tax qualifying manufacturing facilities and related land improvements.
Impact
HB 903 would amend Montana property tax law by adding a new class of taxable property specifically for manufacturing facilities and related land and improvements. This would affect manufacturers, property owners with industrial operations, and local governments that rely on property tax revenue, because qualifying property would be assessed under a new classification with a specified taxable percentage rather than under existing classes. The bill would also require assessors to determine whether mixed-use parcels qualify and how to allocate land classification based on the largest share of improvements.
Sentiment
The available voting history suggests the bill was not controversial at the committee stage, as the House Taxation Committee voted 21-0 to table it, indicating unanimous agreement to set it aside rather than advance it. There are no committee transcript excerpts showing debate, so the public record provided here does not show active floor or committee opposition on the merits. Overall, the bill appears to have had limited momentum and ultimately died in process.
Contention
The main policy issue likely underlying HB 903 is whether manufacturing property should receive a distinct tax classification and a 1.47% taxable percentage, which could lower or alter tax treatment for industrial property compared with other classes. Potential points of contention include the fiscal impact on local tax bases, fairness relative to other commercial or industrial taxpayers, and the complexity of classifying mixed-use parcels. However, no specific objections or supporters are documented in the provided transcripts, and the recorded vote to table the bill was unanimous.