Republican Legislator Rolls Out New Property Tax Cap Initiative 

A new initiative to cap local property tax increases at 2% was rolled out Monday by Republican legislator Wylie Galt of Martinsdale.

The initiative would amend the state Constitution to cap property tax increases by all local governments at 2%, except for increases related to property improvements, like a new deck, or new property such as newly built homes. The cap applies to “residential, commercial, agricultural, industrial, timber and all other property tax classifications.”

This is the third property tax-related initiative attempting to qualify for the 2026 ballot. Two have already been approved for signature gathering. 

As a state senator, Galt was instrumental in passing two property tax bills in the 2025 Montana Legislature that created a $90 million homeowner tax rebate and restructured property taxes, creating a lower rate for primary residences while raising rates for non-primary residential properties.

Two of Galt’s fellow Republican senators, Taxation Committee Chair Greg Hertz and Majority Leader Tom McGillvray, along with former state Sen. Keith Regier, are suing over the new tax law, arguing that Galt’s bill, backed by Gov. Greg Gianforte, changed too many sections of the law at once. If the lawsuit is successful, there’s a chance the state could be ordered to reset tax law to 2024 terms.

“While the property tax reforms, I think HB 231, and SB 542, and Senator Galt sponsored one of those, have helped alleviate residential property taxes across the board, people still want more relief,” said Travis Hall, spokesperson for the initiative.

Hall was Gianforte’s senior adviser, but left the administration earlier this year. “Montanans still want relief, and ultimately this is going to be their decision in November after it qualifies for the ballot.”

On average, county property taxes grew 6.19% a year between 2001 and 2022, Hall said. The statistic comes from the Legislative Fiscal Division.

To make the ballot, the initiative will have to pass scrutiny by the state legislative services division and Attorney General Austin Knudsen, a process that can take several weeks. If approved for signature gathering, the initiative will need the qualified signatures of more than 60,000 Montana voters by June 19 to qualify to appear on the November ballot. 

Local government officials contacted for this article on Monday said they didn’t yet know enough about the initiative to discuss its effects.

The cap wouldn’t apply to school district mills or levies, or to tax increases approved by a majority of voters.

“I’m proud of the reforms we made with Gov. Gianforte in 2025 to permanently cut property taxes for 80% of Montana homeowners, but we must do more,” Galt said in a press release. “We need to cap property taxes to make things more affordable for Montanans.”

The author of two property tax cap initiatives that have already qualified for signature gathering, former Republican state legislator Matt Monforton, said Galt’s initiative allows too many exceptions to effectively limit local property tax growth.

“This is exactly what you would expect from the tax-and-spend Republicans in charge of our state,” Monforton said. “We can start off with the exceptions that are in subsection three, which is the fact that a simple majority of voters can raise taxes, and the so-called cap doesn’t apply to school districts. Those are the two biggest drivers of property taxes.”

Monforton is the attorney representing the legislators suing the state over the new property tax law passed in 2025.

Monforton’s Constitutional Initiative 129 would “limit the annual increase in the valuation of a primary residence to 2% when assessing property taxes unless there are changes to the residence or a change of ownership. New primary residences would be assessed at fair market value as of Jan. 1 of the year following their construction.”

Monforton’s Constitutional Initiative 130 would “limit annual increases in the valuation of real property to 2% when assessing property taxes unless there are changes to the real property or a change of ownership, in which case the real property would be assessed at fair market value starting Jan. 1 of the following year.” 

For both initiatives, purchases or transfers of real property between spouses or between parents and children are not considered changes in ownership for assessment purposes. CI-130 adopts the primary residence tax classification created by the 2025 Legislature.

The legislative fiscal division has 14 days to review Galt’s initiative and suggest necessary changes, after which the attorney general has 30 days to check for legal sufficiency, meaning that Galt could hear back from the state with next steps by early May at the latest.

This story originally appeared in the Montana Free Press, which can be found online at montanafreepress.org.