Skip to main content
You are the owner of this article.
You have permission to edit this article.
Edit
Budget pieces fall into place as end of Legislature expected Thursday
editor's pick topical alert

Budget pieces fall into place as end of Legislature expected Thursday

{{featured_button_text}}

The legislative session cruises toward its end as the major remaining pieces of the state’s budget, more than a billion in federal aid, and $120 million in proposed tax cuts solidified Wednesday.

House Bill 2, the state’s main budget bill that will spend more than $12 billion in state and federal money, advanced from a free conference committee with some significant changes. It and the other budget pieces all cleared the Senate late Tuesday and are awaiting action in the House.

The budget cleared the Senate on a bipartisan 41-9 vote.

Montana State News Bureau Chief Holly Michels summarizes the day's news from the Montana Legislative session for April 28, 2021.

Sen. Ryan Osmundson, who chairs the Senate Finance and Claims Committee, told the Senate Tuesday the budget represents 2.5% growth over two years and is down 1.3% from what Republican Gov. Greg Gianforte proposed.

The budget is structurally balanced, he said. The most recent report from the Legislative Fiscal Division shows the budget in the black $24.7 million and leaving a $480 million ending-fund balance. 

Osmundson provided senators with a sheet showing those figures at $40 million in the black and a $350 million ending-fund balance, plus $122 million in the budget reserve.

The budget also transfers $165 million to address maintenance issues in state-owned building.

"I can't stress enough the state is in a very good financial position at this time," Osmundson said.

Lawmakers voted earlier Wednesday to reverse a proposal added to the bill just the day prior to create a committee within the state health department to review if abortion care for women insured through Medicaid met payment requirements.

Lawmakers retained the $90,000 funding and instead directed it to pay for the Department of Public Health and Human Services to review and report to the Legislature the history, utilization, policies, rules and definitions for abortions covered by Medicaid in Montana.

The federal Hyde Amendment prohibits federal funding paying for abortion services except to save the life of the woman or if the pregnancy is the result of incest or rape.

In Montana, however, the courts have found in Jeannette R. v. Ellery, the state Constitution requires the state's Medicaid program to cover abortions and leaves the decision about whether an abortion is medically necessary up to the patient's doctor. Courts have also found the state's Medicaid program cannot treat abortion differently than childbirth when it comes to determining if a procedure is covered.

Given the interplay between the Hyde Amendment and the state’s laws, Rep. Llew Jones, a Republican from Conrad who chairs the House Appropriations Committee, called it “a prudent report to get done.”

According to the state health department, Medicaid in Montana has covered 5,614 abortion procedures over the last decade, at a cost of $2.4 million in federal and state funding.

Another amendment to the state budget adds 17 full-time equivalent positions to the judicial branch and Department of Justice for the implementation of recreational marijuana, as well as paying for other aspects of the program. That comes at a cost of $2.9 million over two years.

Another major piece of the state’s financial picture for the next four years is House Bill 632, which appropriates more than $1 billion in federal aid from the American Rescue Plan Act passed by Congress in March.

The legislation makes appropriations and sets up several commissions to review proposals for how funding will be spent. There are also provisions to allow the governor to make changes to the projects list, if one no longer qualifies or can’t be completed, during the interim when the Legislature is out of town. Notification to lawmakers is required.

Changes made Tuesday include $15 million to nursing homes and hospitals with nursing home beds, with the allocation based on patient numbers. There’s also money to study the rates that providers of various Medicaid and Medicare services are paid. In HB 2, lawmakers also made adjustments to those provider rates.

In amendments to a broadly titled budget bill on Tuesday, another free conference committee voted to require the state health department to report any time it makes adjustments to provider rates. GOP lawmakers have raised concerns that the department made changes to some of those rates during the interim without legislative input.

Rep. Jim Keane, a Butte Democrat, called the money from the aid package transformational for the state's infrastructure. The bill pays for projects normally handled through bonding, as well as water, wastewater and sewer work and also puts $275 million toward broadband efforts.

"The budget of Montana looks better ... and the federal money, if we don't spend it, somebody else will," Keane said.

HB 632 passed the Senate on a 43-7 bipartisan vote.

A third bill that's part of the final legislation lawmakers need to address before adjourning also advanced Wednesday. That's HB 663, a bill that will tap about a quarter of the revenues from a 20% tax on recreational marijuana and use it to lower property taxes in parts of the state.

That's done through making changes to the guaranteed tax base (GTB) formula that funds schools. The state is required to fund schools at a sufficient level, with part of that achieved through GTB and another part through permissive mills, which are non-voted mills people pay through property tax.

HB 663 works by dedicating $10.2 million in the first year it hits and $12.8 million in the second to increase GTB, which means the permissive mill value value, and therefore property taxes, can drop.

The bill will tap about 25% of the recreational marijuana revenue that hits the general fund, which is where money goes after $6 million is directed to substance use disorder treatment and about $5 million in 2023 toward public lands access. The additional money will lower property taxes further.

A fiscal note for the bill does not anticipate how much it will offset property taxes, but Jones said it's likely the change will hit lower-income areas and those with high student populations the most. Overall, GOP lawmakers estimate between reductions to the state's top income tax bracket and other changes including HB 663, they're cutting taxes by about $120 million over the two-year budget.

The bill passed the Senate 50-0.

The changes made across the bills Wednesday were approved by the Senate, but still need House action before advancing to the governor. HB 2 is typically one of the last bills to pass the Legislature.

State bureau logo
1
0
0
0
0

Get Government & Politics updates in your inbox!

* I understand and agree that registration on or use of this site constitutes agreement to its user agreement and privacy policy.

Related to this story

Get up-to-the-minute news sent straight to your device.

Topics

News Alerts

Breaking News