Lawmakers inch closer to session-ending deal

By MOLLY PRIDDY
Community News Service
UM School of Journalism

HELENA – Shadowy negotiations between Democrats and Republicans on children’s health insurance and school funding came to light on Friday, hinting at a possible break in the state budget stalemate as the 61st Montana Legislature winds down.

Both parties said it was time to compromise, saying they completed more work in three or four hours than they had since Monday. Leaders said they were optimistic about the negotiations, despite a petition for special session requested by Senate President Bob Story, R-Park City.

“At least everybody is talking,” said Senate Majority Leader Jim Peterson, R-Buffalo. “That’s a good sign.”

At a meeting before noon Friday, both Republican and Democratic budget chairmen explained the deals they had been attempting to make with the other side over the highly contentious Healthy Montana Kids Plan and K-12 education.

Senate Finance and Claims Chairman Keith Bales, R-Otter, said the Senate had proposed raising state funding for education and allowing a gradual implementation of the voter-approved expansion of programs that offer health insurance for children from low- and moderate-income families.

Earlier this session, the House agreed to 3 percent increases in state funding for K-12 schools. Senate Republicans cut the state funding to 1 percent, backfilling the difference with one-time-only federal stimulus dollars.

Bales said the Senate GOP sent a proposal to House leaders Thursday night that would fund K-12 education at a 2 percent increase, using stimulus money to make up the final 1 percent. The proposal also contained a gradual implementation of the Healthy Montana Kids Plan, which would cover an estimated 30,000 uninsured children by July 1, 2010.

Bales said as state revenue estimates keep falling, expensive programs should be taken in stride. “If we’re going to err we need to err on the side of fiscal caution,” he said.

But House Democrats countered with a proposal of their own Friday morning, asking for a 2 percent raise for schools but demanding an immediate, full expansion of health coverage for uninsured children.

House Appropriations Chairman Jon Sesso, D-Butte, said a 2 percent increase for K-12 schools is a fiscal reality during a recession, backing off of previous statements that a 3 percent increase should be the minimum.

“(Schools have to be willing to also cut a little bit and prepare to cut in the future,” Sesso said.

Sesso also said the Healthy Montana Kids expansion would not require all the funds currently reserved in its bank account because it would just be starting up. So, Sesso said, there could be $10 million per year transferred to the state checkbook to balance out the 2 percent across the board cut Senate Republicans gave to all state agencies earlier in the session and bolster health programs for the poor.

But Bales said going full bore with the health insurance expansion could lead to fiscal potholes down the road.

“I don’t think anybody knows how fast it will ramp up or what the cost actually may be,” Bales said.

Republicans eventually responded with another proposal, which Democratic leaders said was headed in a positive direction but did not elaborate on details.

The House and Senate budgeting committees agreed to work through the weekend to hammer out the details on education and children’s health care in hopes of passing a budget before the final legislative day on Tuesday.