Representatives from Verizon, T-Mobile and AT&T asked Montana lawmakers Friday to pass a bill that would offer them a property tax break if they expand their Montana networks, saying a lighter tax load on wireless infrastructure would encourage them to invest in reaching difficult-to-serve rural areas.
The proposal, Senate Bill 534, would add wireless infrastructure such as cell towers to an existing tax break available to companies that expand their wired broadband networks. Shortly after the bill wrapped its initial public hearing before the Senate Taxation Committee on Friday, the committee voted 7-1 to advance it for debate on the Senate floor. In order to become law this year, it needs to clear the Senate by April 5.
The bill’s sponsor, Sen. Greg Hertz, R-Polson, and other supporters argued at Friday’s hearing that extending the treatment currently on the books for wired telecom companies to wireless providers is a matter of providing fair treatment to different types of communications technology. They also said it’s a smart way to address the business challenges involved in serving Montanans who are often scattered across the state’s vast landscape.
“It’s a lot easier to beam signal from a tower into a lot of areas of Montana than it is to plow fiber,” said Mike Green, representing Verizon.
No opponents spoke against SB 534 Friday. A similar bill came close to passing the Legislature in 2023 before being caught short by late-session procedural wrangling.
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Senate Bill 51 aims to address a troublesome gap in Montana’s infrastructure: places where residents still don’t have access to reliable broadband internet.
The existing broadband property tax break, passed in 2021 via that year’s Senate Bill 51, provides a five-year property tax exemption for newly built fiber optic or coaxial cables and then phases those taxes back in over five years. The bill’s sponsor, Hamilton Republican Sen. Jason Ellsworth, said at the time that providing a tax break for new broadband infrastructure would make it easier for telecom companies to deploy “last mile” internet connections in often-underserved rural areas.
Because of how Montana’s property tax system divides the cost of running schools, police departments and other local services, tax breaks offered to businesses shift taxes to other property owners, including homeowners.
The existing tax break requires that companies reinvest the tax savings in additional telecommunications infrastructure. It also specifies that companies can’t claim the tax credit for projects built with funding from the 2021 American Rescue Plan Act, the federal pandemic relief measure that has routed more than $300 million to Montana broadband projects.
State officials are also in the process of awarding another $629 million in broadband expansion funding provided by the federal Broadband Equity, Access, and Deployment (BEAD) and Digital Equity programs, funded through the 2021 Infrastructure Investment and Jobs Act signed by former President Joe Biden. There is, however, some concern nationally that the Trump administration’s efforts to rein in federal spending could delay or derail those programs.
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Wireless industry advocates argued Friday that a state tax credit would complement the federal spending programs by shifting the financial calculations companies make as they weigh whether spending money in rural Montana or elsewhere can deliver them the best investment return.
“This is not, as we’ve heard, the panacea to deploy wireless throughout the state of Montana. That’s not what this is designed to do,” said AT&T lobbyist Mark Baker. “It’s designed to be that incremental benefit incentive to building areas where, right now, the [return on investment] doesn’t make sense.”
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