When the 66th session of the Montana Legislature convenes Monday, many of the debates brewing before lawmakers will be familiar — the state budget and taxes, infrastructure and Medicaid expansion.
Republicans again hold a majority in the House, 58-42, and the Senate, 30-20. It will be the last session for Democratic Gov. Steve Bullock.
In his budget released in November, the governor calls for several proposals similar to his pitches in previous years, but he says they've changed enough to make it through the GOP-dominated Legislature.
Republicans say they’ll bring much of the same approach they did in 2017, with many in the party vowing to oppose new taxes or taking on debt to do building projects, both a part of Bullock’s budget. But there are also cracks emerging in the GOP caucus, a change from the unity the party found two years ago after a stretch of rocky sessions with divisions between moderate and conservative wings.
Whether to keep Medicaid expansion, which legislators first approved in 2015 with moderate Republicans crossing the aisle to vote with Democrats, will be one of the largest issues in the 90-day session. Bullock and fellow Democrats in the House and Senate say the program, which has a sunset date of this summer, must be extended to preserve health insurance coverage for nearly 100,000 Montanans.
Republicans are not in lockstep on the issue. Some want to extend expansion with the addition of work requirements and means testing, which will likely shrink the pool of people covered. Others in the party say they don’t know if the program should continue at all.
Medicaid expansion offers coverage to people who earn up to 138 percent of the federal poverty level, which is $16,753 for a single person and $34,638 for a family of four in 2019.
The state pays a lower share of the costs for people covered by expansion. The federal government will pick up 90 percent of the cost in 2020 compared to about 60 percent for traditional Medicaid coverage.
Bullock wants to pay for the state's share of expansion with revenue from the general fund. The program costs the state about $57.4 million a year, though costs are offset by about $28.4 million in savings.
Bullock said he was encouraged that there’s support to continue the program among lawmakers, even after voters in the November election defeated a ballot initiative that would have lifted the sunset date and used a tax on tobacco products to pay for the state’s cost of covering people.
The governor’s office has frequently cited numbers it says show expansion is a social and economic benefit to the state: the uninsured rate has dropped from 20 percent to 7 percent, uncompensated care delivered by hospitals is down by half and the economy has added 5,000 jobs in health care, pumping $500 million into the state’s economy. The office also points out the state saves money by switching people from regular Medicaid coverage to expansion because of the higher federal payment rate.
In the run-up to the session, the governor’s office has added a line of support to its call to extend expansion — saying it supports small businesses by providing health insurance to their employees.
According to data from the governor’s office, the state health department and the Department of Labor and Industry, 54 percent of businesses in Lewis and Clark County have employees who are covered under Medicaid expansion. In Butte-Silver Bow County that number jumps to 64 percent.
“If you’re in Silver Bow County, two-thirds of the employers … aren’t necessarily paying enough for employees to buy health care on the individual market,” Bullock said. “I think it’s time we really look at that and look at it in that way. Let’s not lose sight of how important it is for the businesses.”
For Republicans who want to see Medicaid expansion continue, the program has to come with some sort of additional caps on eligibility, in the form of work requirements and asset and means testing.
Incoming Rep. Ed Buttrey, a Republican from Great Falls who was previously in the Senate and carried the initial bill for Medicaid expansion in 2015, said he thinks the program will continue with what he calls a “community-benefit requirement,” another way of saying work requirements or volunteer hours for those who aren’t able to hold a job.
“We have some additional efficiencies and reforms we’d like to implement,” Buttrey said when lawmakers gathered in Helena to elect leadership in November. “We also need to strengthen our asset measurement tool and make sure that the people on the program are the ones that need it the most.”
Bullock wouldn’t say if he would sign a bill that had some form of work requirement or asset testing. Democrats have said the limits are ways to lower the number of people on the program, which would make it cost less to the state but hurt those who can’t afford coverage on the open marketplace.
“Before we go down that road we have to look at whether means testing is even allowed under the Affordable Care Act,” Bullock said, referencing legal challenges to those approaches in other states. “I’m more than happy to talk to any legislator, Democrat or Republican, but I think it has to work for Montana.”
Though voters didn’t support extending Medicaid through the ballot initiative, the most expensive in state history, Bullock says that defeat was more about the millions spent by tobacco companies than what Montanans want.
Buttrey said he viewed the effort as a flawed approach that took control away from lawmakers.
“I think there is an appetite by most legislators that the program continues,'' Buttrey said. "It’s been a great program for the state. I think it’s a bipartisan group that realizes how important it is that we move forward, but it will have to change.''
The bipartisan group Buttrey referenced, and its strength, will likely be on display at the start of the session as the normally wonky issue of legislative rules takes center stage.
The rules governing how each body of the Legislature operates are typically adopted at the start of the session with little fanfare or any awareness outside the statehouse.
This session is different. On opinion pages in newspapers around the state and on social media, a group of lawmakers have made their arguments for changing the number of votes it takes to blast bills tied up in committee onto the House floor. Right now it takes a supermajority of 60 votes, but the group of lawmakers wants to change it to a simple majority of 51.
Republicans hold a 58-42 majority in the House, so at least two Democrats would be needed to blast bills under the existing rules. A simple majority would make it easier for lawmakers to revive a bill that’s been left for dead in a committee. That could come up during the session when lawmakers consider a bill to extend Medicaid expansion, for example.
Republicans who argue for the new rules say the change would end insider politics of people cutting deals with the other party to get enough votes to blast bills to the House floor. They say the 60-vote requirement gives the minority — in this case, Democrats — outsized power. Those lawmakers also point out the Senate has the same rules they want the House to adopt.
A group of about 14 lawmakers has been identified as supportive of the rules change, as first reported by Montana Free Press. That includes Republican Rep. Nancy Ballance of Hamilton.
In November, Ballance said in a bid to be speaker she told the House GOP caucus she wouldn't support a rule change, but said she did a "terrible job of explaining." At the end of last month, she wrote an opinion piece in support of the change.
If she was elected speaker, she said, a small group of lawmakers she is working with called the Solutions Caucus, which aims to stay above the fray of GOP division, would have had enough trust in her to not need the rules change. But she wasn't picked for speaker.
“We try to keep the partisan politics, or the Republican infighting, or whatever it happens to be, we try to keep that at bay while trying to craft real solutions for Montana,” Ballance said. “Budget people sort of have to do that or you can’t go home (at the end of the session).”
Speaker of the House Greg Hertz, a Republican from Polson, does not support the rules change. “The rules that we have in place, they look like they are adequate and they’ve done the job for decades here in the Montana House,” Hertz said.
At this point it’s unclear when the rules debate will happen. Lawmakers must adopt rules at the start of the session. A committee that was set to vote on them in November adjourned abruptly before taking any action and has not set a meeting for the start of the session.
“The hope is we can find some middle ground, get a bill to the floor and actually move on with doing the work we need to do,” Ballance said. “I think we have the opportunity to do that, but it’s perishable. The opportunity doesn’t last much past (this) week.”
As in sessions past, infrastructure — money to pay for roads, sewer systems, schools and other public construction projects — will again be a large part of the 2019 session.
In 2013, Bullock vetoed an infrastructure bill he said would deplete the state savings too much. In 2015 and 2017, lawmakers couldn't agree on the right mix of cash and borrowing to pay for projects, or what parts of the state needed the money most.
This year Bullock proposed a $294 million infrastructure package he thinks will appeal to Republicans. What sweetens the pot this time, he said, is a $44 million program specifically for small communities affected by oil and coal development.
Republicans have said they want to see a 10-year game plan for projects, and then some in the party would be more open to Bullock's mix of bonding and cash. Others, like Senate President Scott Sales, a Bozeman Republican, don’t see enough different in Bullock’s pitch this session from 2017.
“It’s a pretty heavy lift to get a supermajority of the Legislature to vote for this bill,'' Sales said. "I don’t see that whatever he’s done there is going to really garner a lot more support than it has in the past.”
Both parties point out between 2013 and 2017, the state funded $232 million in local projects for drinking and wastewater systems, sewers, solid waste disposal, schools and bridges. There’s also been $60 million for updates and construction within the university system.
Rep. Casey Schreiner, a Democrat from Great Falls who is minority leader in the House this session, said infrastructure will be a main focus of Democrats.
“This is my fourth session, and I think it’s kind of embarrassing we haven’t been able to put together some sort of package. And I think the majority of legislators actually want to get this done,” Schreiner said.
Budget and taxes
Sales predicted in November that the session would focus, at least from a Republican standpoint, on the budget. He said many Republicans, like himself, would not have an appetite for many of Bullock’s proposed tax increases to pay for programs.
Bullock's budget contains about $100 million in new taxes and spends 7 percent more than the budget passed in 2017. The $10.3 billion plan has an increase in the tobacco tax, a freeze on tuition at public universities and $30 million for public preschool options. It also builds the state’s ending fund balance, or savings account, back up to $300 million.
In mid-December, Bullock emphasized the need for publicly funded preschool, saying Montana was one of six states without a program. Earlier this year he took a bipartisan group of lawmakers to visit Alabama and review the program there.
While he got some funding for pilot programs last session, Bullock said he’s “optimistic” lawmakers will see the benefits of the preschool to the tune of $30 million this year.
“I walk in optimistic from the perspective of when we talk about publicly funded preschool, that I’ve been talking about this for a while, finally the Legislature said, ‘Let’s actually see how this works.’ I do walk in optimistic that they're going to see what a difference it’s made for communities large and small and want to build on that,” Bullock said.
Republican leadership, meanwhile, doesn’t support much in Bullock’s budget.
“We ... don’t really see the need to raise taxes,” Sales said. “We’re going to do with what we have. … We don’t see a lot in this budget, especially from the taxation standpoint, that we’re going to be in agreement with.”
But Schreiner said he thinks the budget Bullock proposes helps move the state forward. He also wants to look for a way to build back some of the cuts made the summer after the 2017 session, about $97 million, and an additional $75 million during a special session that same year, after revenues came in lower than projected and Montana had its most expensive fire season in state history.
“We got to find a way to get those services back,” Schreiner said. “Some of them have been restored, but not all of them. We need to make sure we pass a budget that is fair for all Montanans, and the people at the most disadvantaged don’t get left behind,” Scheriner said.