Senators struggle over plans to slash spending

By MOLLY PRIDDY
Community News Service
UM School of Journalism

HELENA – Senate Republican and Democrats on a key budget committee clashed Thursday over spending priorities as the GOP majority laid out ideas to reduce all state agency funding and scale back children’s health care coverage.

Republicans on the Senate Finance and Claims Committee said reductions in House Bill 2, the state budget bill, are necessary if the Legislature wants to have a $250 million rainy day fund in 2011.

“I would like to see us get to structural balance and I think we’ve had indications that if we don’t reach a $250 million ending fund balance, the governor will probably veto things to get there,” said Committee Chairman Keith Bales, R-Otter. “I would rather see the (Legislature) decide where the money is spent … than (have) the governor do it.”

Republicans said they want a structurally balanced budget, meaning the state can only spend the amount of revenue they collect in the next two years. Since revenue projects look to keep falling, lawmakers say this means cutting state spending.

In one of only two ideas discussed to reduce state spending, Bales suggested reducing every state agency by another 2 percent, which he said would save $30 million over two years.

The other idea to reduce spending, introduced by Sen. Dave Lewis, R-Helena, would be to scale back the Healthy Montana Kids Plan. The program, approved by voters in November, would expand health care insurance for Montana children.

Lewis suggested reducing the number of children eligible for such coverage by reducing the amount of money their parents can make and still qualify. Currently, families with incomes at 250 percent of the federal poverty guideline can qualify. Reducing that to 200 percent would save the state $50 million, he added.

“It’s one of a series of bad choices, but we’re going to have to look very hard at any proposed expansion,” Lewis said.

But Democrats said getting pure structural balance could mean downsizing important services people may need as the recession continues.

Every budget decision “has a human face on it,” said Sen. Carol Williams, D-Missoula. “I don’t have the view that we have to have the structural balance that I think Sen. Bales does.”

Sen. David Wanzenried, D-Missoula, said cutting public services would hurt those who feel the recession the most. “Do you think we can do that without affecting the public we’re supposed to serve? I don’t,’ he said.

Democrats said the state’s revenue estimates may be down right now, but no one knows how the fiscal picture will look in two years. What looks like excess spending now could be equalized by higher future revenues, they said.

Decisions on HB 2 are expected on Friday, with numerous amendments from both sides of the aisle.