Over 1,000 informal reviews, also known as property assessment value protests, were filed with the Montana Department of Revenue, resulting in Lake County refunding $446,000 this year from collected 2025 property taxes. 

While the protests represented only roughly 4.5% of the county's total parcels, property-tax revenue from the 2025 tax bills had already been budgeted, meaning lower reassessments reduced funding for the City of Polson, the county’s general fund, and smaller budgets such as the Mission Valley Aquatic Center.

According to Finance Officer Tara Barry, these changes caused the county to lose $23,000 from its general fund, $17,000 for employee health insurance and $32,000 in public safety funding. Barry said that, as a result, the county budget is not necessarily in a deficit, as all departments were very frugal during the 2026 fiscal year. 

In Montana, the Montana Department of Revenue appraises real property and determines the market value and classification for each property. It then determines the taxable value under Montana state law and provides that information to local governments. The county treasurer then uses the taxable value provided by the Montana Department of Revenue and the applicable mill levies to calculate each property owner's tax bill.

In an email to the Leader, the department’s public information officer, Scott Mendenhall, explained that state law requires the department to appraise all properties at 100% market value. With 800,000 properties to classify and appraise across the state, the department uses a modeling program that is “highly accurate” and within 5% plus or minus of actual sales prices. 

“While highly accurate overall, there inevitably are individual cases where our appraisal process isn’t as accurate as it could be,” Mendenhall stated. 

Mendenhall stated that this is when the AB26 process comes into play, allowing taxpayers to disagree with the department’s valuation. 

“When a property owner brings information to our attention, the appraiser can review the property, make any necessary corrections, and then determine whether those changes affect the value,” explained Mendenhall. “In some cases, correcting the property characteristics will result in a lower assessed value.” 

He explained that while a change in value may result in a refund, the informal review process allows the department to identify and correct inaccurate property information. 

“The fact that a property owner receives a reduction through the review process does not necessarily mean the original assessment was improperly determined,” Mendenhall stated. “It shows the value of a process that lets us review the information and make a correction when additional or more accurate information is provided.” 

According to Mendenhall, as of Sept. 3, 903 total real property appeals were filed in Lake County, with 568 receiving adjustments, of which only 12 were property value increases. The department still has 88 appeals pending evaluation. Mendenhall stated there has been an uptick in appeals since the COVID-19 Pandemic, mainly because property values have risen in the western third of the state. 

In 2023, Lake County residential properties saw a median value increase of $92,000, and the median price point rose from $250,000 in 2022 to $242,000 in 2023. Medenhall reported that another increase occurred in 2025, when Lake County residential properties saw a median value increase of $121,000. 

Along with jumps in property values, the 2025 Legislature also changed property tax rates. When asked whether the new complexity of changing taxable values is driving confusion and leading to more appeals, Mendenhall stated that the department has worked diligently to communicate the 2025 tax reforms. 

He added that they understand some of the public is still learning about them, and stated, “logically we would assume the changes are a contributing factor to the increased number of appeals.” He also stated that they assume fast appreciation in property values is also contributing to the increased appeals. According to Mendenhall, 767 AB 26s were filed in 2023, representing 3.5% of properties within Lake County. 

County drafts resolution to manage assessments 

Before the 1972 Montana Constitution shifted assessment responsibilities to the Department of Revenue, historically the county assessors handled these assessments. 

Lake County Commissioner Gale Decker explained that the county feels like, under the department, “lots of properties” are missed during the biannual assessments. Decker explained that “maybe” if the county managed the assessments, they could do “a better and faster job” of appraising properties, allowing them to get the property on the tax rolls, which would increase county revenue. 

Decker said the county has drafted a resolution that it plans to present to lawmakers that would allow Montana counties to do appraisals under the guidance of the Department of Revenue. He said the resolution has been brought to the Montana Association of Counties in hopes they will support it. 

Decker said this bill would kind of mimic how Idaho, North Dakota and Wyoming do property appraisals. He explained that these potential county appraisers would be trained and their work would be checked by the Department of Revenue.

The county aims to have HD 12 Rep. Tracy Sharp draft the bill in this format, which would allow counties to opt in to assess their own properties under the Department of Revenue. 

“We just want, as a county, to be able to maybe hire enough appraisers to make sure the job gets done and then also hold these people accountable for the number and accuracy of the appraisal,” he said. 

Commissioner Bill Barron said it's clear the appraisal process is handled by the department under the Montana Constitution, but they hope this bill would allow them to work under those department guidelines. But he is unsure if the cost for the county to handle it would be worth it. 

Decker said he is unsure how many employees the county would need to manage the assessments, and he’s unsure how many assessors work out of the Department of Revenue’s Polson field office.   

“I’m guessing two or three, but by their own admission, they’re short-staffed. They can’t get to all the properties that need appraisal,” Decker said. 

He added that the local office has no repercussions or penalties for not getting a property on the tax rolls. 

“There’s no consequences,” Decker said. “But on a county level, for properties that don’t get appraised, we pay a consequence and the other taxpayers, because we don’t get the property tax revenue that we should be bringing in.” 

When asked whether the Department of Revenue is adequately staffed to handle property tax assessment and appeals in a timely manner within Lake County, Mendenhall stated that the department hires and trains highly capable staff. 

Mendenhall further explained in his answer that their appraisers complete industry-standard competency training and must pass certification exams before conducting appraisals. 

“With state-level supervision, citizens are assured that processes are consistent across all counties and locations with no county-to-county variances. Given the new tax laws and market appreciation, our staff are taking extra time with each appeal to help taxpayers under the new law and the process,” Menenhall added

He said the department is getting through appeals at a “reasonable pace,” while making sure that they're getting accurate and correct valuations.