Montana Legislative Wrap Up 2025

From workforce and licensing to housing and taxation, Montana has seen 1,704 bill drafts affecting real estate, and 100 legislative proposals with potential for significant impact. 

Below is a list of legislation in differing categories that may affect you. The following is not meant to represent all changes to Montana law.

Business Impacts: Department of Labor Laws & More

• HB 367 revise workers compensation laws relating to travel and reimbursement; protects employers offering perks like take-home vehicles

• HB 197 provides that an employee is released to return to work from an injury by a physician, clarifying employer responsibilities and reducing liability

• HB 210 lowering unemployment tax rates for businesses with a clean record and making it harder for frauds and abuse of the system

• HB 206 limits who can request an electricians' license on a job site

• HB 427 requires state and local agencies to provide written explanation citing specific code w/in 7 days of issuing a stop work order or delaying a permit.

• HB 239 replaces contractor registration with mandatory licensing under the Dept of Labor & Industry. Contractors must meet conduct standards and gain state approval to

operate.

• HB 225 establishes licensing for home inspectors; includes 40 hrs of training, national association membership, insurance and adherence to conduct standards

• HB 261 will standardized contested license processes across all boards and programs including streamline notices and make enforcement more consistent.

• SB 373 lien filings may occur in any county, not just where the work occurred

Regulatory Reform: Increasing Housing Flexibility

• SB 532 mandates that counties allow Accessory Dwelling Units (ADUs) by right and eliminates restrictive local ordinances on parking and design.

• HB 492 limits local governments' ability to enforce excessive parking minimums, especially for smaller units and deed-restricted housing.

• SB 121 introduces updates to subdivision review authority and streamlines building code compliance.

• SB 213 allows for single-stairwell construction for certain mid-rise buildings.

• SB 243 requires cities over 5,000 residents to permit duplexes in single-family zones and to allow multi-unit and mixed-use developments in commercial areas as well as limits parking and height restrictions in certain areas.

• SB 175 allows for streamlined public hearing notice process when revising zoning.

• SB 174 provides that recreational vehicles and mobile homes are reviewed as buildings for rent or lease.

• HB 444 provides tenants and landlords modern options for handling security deposit transactions.

• SB 262 subdivisions with pre-approved water and sewer systems meeting design conditions and operating correctly can be exempt from additional review. Builders in

qualifying subdivision won't have to undergo full DEQ environmental review.

• SB 252 ensures zoning allows for manufactured and factory built housing in residential area without additional requirements

• HB 614 allows county commissioners to terminate a zoning district if the county opts into the Montana Land Use Planning Act or if the district is merged into a larger zoning

district

• SB 275 adjusts ag covenants and subdivision review to convert ag land into housing if annexed by a city

Housing Access: Affordability

• HB SOS reauthorized the Governor's HOMES Act as a revolving loan fund and allocated another $5O million. It expands project eligibility, including support for mobile home

parks and multifamily ownership opportunities.

• HB 924, the Montana Growth and Opportunity Trust {GO Trust), represents a major long-term investment in housing. It establishes a revolving loan fund-the Housing Trust-with an initial $31.2 million investment and a sustainable revenue stream. As the Trust grows, it is projected to yield $12.5 million annually to support new affordable housing development statewide.

• SB 337 allows developers to prepay property taxes for five years during subdivision development to reduce tax liabilities and reduce the cost of producing housing.

• SB 133 establishes impact fees may not increase more than the rate of inflation and removes the administration fee

• SB 117 increased the inflation rate cap used in mill levy calculations to 4% and limits annual property tax revenue growth to a maximum of 4%

• HB 908 an employer hiring an apprentice in the construction industry will be eligible for the employer job growth incentive tax credit Defending Water Rights and Property Interests

• SB 358 would have closed the aquifers for most exempt well use and all subdivisions in the Helena, Bitterroot, Gallatin and Missoula areas outside of city limits, forever.

Finally, please see the following summary of general tax policies from the 2025 Legislative Session and their impact upon you and your businesses.

HB337 (Ler, R) reduces most income taxes to 5.65% in 2026 and 5.4% in 2027 and expands eligibility for the 4.7% rate. The bill collapses seven tax brackets into two and

decreases the top tax rate for non-capital gains income from 5.9% to 5.65% in 2026 and to 5.4% in 2027.

HB 231 (Jones, R) offers a $400 rebate for 2024 property taxes on a primary residence and property tax decreases for owner-occupied homes and some long-term rentals.

SB 542 (Galt, R) restructures Montana's property tax system by freezing values at 2024 levels for two years and starting in 2026 lowers taxes for homeowners, long-term rental

properties, small commercial property owners, and farmers with Class 3 ag property, and sets up a $400 rebate for 2024 property taxes.

As always, we hope you found this information helpful!

For more information about Montana legislation, click here.