Plum Creek settlement crunches school budgets

Plum Creek settlement crunches school budgets

By CASEY DUNN

Hungry Horse News

The school district's potential revenue took a big hit from the Flathead's largest taxpayer last month.

School District 6 business manager Susan Fleming recently presented numbers to show the impact Plum Creek's Nov. 16 tax settlement could have on the district.

According to her calculations, in the tax year 2004 Plum Creek will have a $659,545 reduction in taxable value. That results in $95,904 less tax revenue for elementary schools and $36,018 less for the high school.

In 2005, the company will have a reduction of $208,855. That means $32,588 less for elementary schools and $11,282 less for the high school.

Plum Creek's Columbia Falls sawmill, plywood and medium density fiberboard plants pay taxes to the school district.

School board members said they were concerned because it means more of the tax burden will be shifted to homeowners.

Fleming said the one positive point is that Plum Creek can not protest their tax rate for years through 2008. That allows the district to better predict their tax revenue.

The state Department of Revenue agreed to settle the company's 2003 and 2004 tax protest rather than continuing to appeal last year's decision by the Flathead County Tax Appeal Board, which favored Plum Creek, said state appraiser Gary Peterson.

According to Peterson, Plum Creek used economic figures from 2002, a poor year for wood products, to show that its facilities in Columbia Falls had a lower value than what the state said they were worth.

But in 2003 and 2004, the lumber industry boomed. Housing starts in 2003 reached a 25-year high, and lumber production in the West hit an 11-year high, according to a Western Wood Products Association report.

This resulted in higher prices for each of Plum Creek's manufactured products in 2004, the company reported.

State statute, however, prevented the state Department of Revenue from using the 2003 and 2004 figures in Plum Creek's tax protest, which was filed in 2003.