House bill allows Missoula County to collect unpaid mill taxes
By Sherry Devlin/Missoula Current
The Montana House will take a final vote Monday on legislation allowing Missoula County to sue the owners of the former Smurfit-Stone mill site for more than $1 million in delinquent property taxes.
House Bill 516, sponsored by Rep. Kim Dudik, D-Huson, and Rep. Adam Hertz, R-Missoula, passed out of committee on a 13-7 vote, then was approved Saturday in an initial House vote.
If given the final go-ahead Monday, the legislation will move to the Montana Senate after the transmittal break.
M2Green Redevelopment purchased the shuttered Frenchtown linerboard plant in 2011, and immediately began dismantling the buildings and equipment for sale as salvage.
More than 3,100 acres there are a federal Superfund cleanup site, but the extent and details of the cleanup have not yet been determined. M2Green remains opposed to the Superfund designation; the company is headquartered in Alton, Illinois.
Other than a few small payments, M2Green has not met its property tax obligations to Missoula County, the Frenchtown School District and other taxing jurisdictions.
Frenchtown schools are owed more than $300,000. The $50,000-a-year hit accounts for 4 percent of the district’s budget and has forced school officials to deplete their reserves.
Missoula County is owed another $1 million in back taxes.
Hertz, whose House district includes the former mill site, said he got involved when Dudik’s bill came before the taxation committee, of which he is a member.
“I could see issues with it and that it wasn’t going to make the cut with Republicans,” Hertz said. “But I could see the value of it for the Frenchtown site, and potentially in the future for Columbia Falls (the former aluminum mill site) and Colstrip (the power plants).”
Hertz joined Dudik as a co-sponsor and worked with her on amendments that would make the bill more palatable to the GOP majority.
Subsequent amendments eliminated the bill’s call for treble damages, allowed the prevailing party to collect attorney fees, and added a provision limiting the bill to property taxpayers who were $250,000 or more in arrears.
That answered most of the Republican legislators’ concerns, and the bill passed out of the taxation committee late last week.
It is necessary legislation, Hertz said. Here’s why:
Typically, when a property taxpayer is delinquent on their taxes, a lien is placed on the property. If the taxes remain delinquent for three years and the taxpayer never catches up, whoever buys the lien can take over the property.
The problem is with sites like the former Smurfit-Stone mill, where the environmental liability is significant and neither the government nor a private buyer wants to hold or buy the lien. That leaves the county and the school district with no way to go after the delinquent taxes.
Dudik’s bill allows the taxing jurisdictions to file a petition in court to recover the back taxes.
In a Facebook post, Dudik told her constituents that the measure pushes back against “large, out-of-state businesses” that want to “take advantage of Montana for their own profit.”
“It also protects businesses and honest landowners with an honest dispute with the county over taxes because the county still has to prove it is owed what it claims,” she said.
In an interview, Hertz said his long-term goal for the Frenchtown site is to see a return of jobs and “some kind of industry,” a goal shared by the West Valley Community Council.
“I don’t claim to know the path to that direction,” he said, “but I think there are options – including, certainly, the potential for environmental cleanup and even possibly some housing development out there. I would like to see an environmental cleanup and a new industrial use would be ideal.”
Hertz said he intends to become more involved with the Frenchtown site discussions, now that he represents that district in the Montana House.
“It hadn’t been on my radar until I ran for the House – and this site is right in the middle of the district. I would like to be a lot more involved moving forward.”
Sherry Devlin is a longtime Missoula journalist. She can be reached by email at email@example.com.