Can The City Of Great Falls Reduce Spending?
Lat week the Great Falls City Commission passed the City’s Fiscal Year 2025 budget. You can view the budget details here.
This year’s budget included a marginal tax increase for local property owners – $2.25 per month for a $300,000 home.
I’ve received several general questions about how our budget works and so I’d like to briefly address those here.
First, can the City reduce spending? The answer is, yes of course it can.
But the better question is this: Can the City reduce spending and continue to maintain the level of public safety, public services, and public amenities that citizens require and expect? That is the balance that must be struck each and every budget cycle, and I am satisfied that we accomplished that difficult balance this year.
So in light of that, I’ve been asked to define in simple terms the only two ways the City can raise taxes for the general fund.
Permissive Medical Levy
Rising health insurance costs for employees have gone up again this year and if we want to attract and retain quality City employees and professional management positions we have to compete in the job market with other municipalities and private sector employers.
The permissive medical mill levy can be used by a political subdivision, like the City of Great Falls, to pay for increased costs of group health insurance benefits for its employees. This year the budget is raising the levy 1.58%, equaling $317,544, to cover the rising cost of City employee health insurance premiums.
Inflationary Factor
Inflation is a very real problem that impacts every City department – the ever-rising cost of the supplies, materials, equipment, and parts it takes to maintain a quality modern city has been, and will continue to be, a major challenge.
Per Montana Code Annotated the City can only raise property taxes via the inflationary factor by half the average rate of inflation for the previous three years. This fiscal year the factor is 2.8%, allowing the City to raise $562,520 for general fund purposes, which includes police, fire, and courts.
