Legislature remains deadlocked over budget bills

By MOLLY PRIDDY
Community News Service
UM School of Journalism

HELENA – Simmering frustration and parliamentary jousting marked yet another day in which Montana lawmakers failed to find a compromise over a budget to guide the state through the next two years.

As the 90-day session draws to a close, the House today voted to dissolve a special committee attempting to patch together a bill that specifies funding for children’s health insurance and education, key points of contention between Democrats and Republicans.

House Bill 676 is the partner bill to the state budget bill, House Bill 2. It provides implementation language needed for appropriating state funds. This bill also contains the amendments from the GOP-controlled Senate cutting House proposals to fully fund the voter-approved Healthy Montana Kids Plan and to finance K-12 schools.

“All the bad things that the Senate did to us are in there,” said House Speaker Bob Bergren, D-Havre.

Bergren said his decision to dissolve the conference committee on HB 676 does not kill the bill itself, because another committee could be appointed. But it was meant as a warning to Senate Republicans, he said.

“Let’s negotiate and go home,” Bergren said. “They’ve wasted four days on me.”

But Senate Republicans said the House’s actions did nothing to quicken the pace of budget negotiations, which have been at a stalemate for days.

“I think that does pose some very serious problems with being able to go on ahead and complete the process,” said Sen. Keith Bales, R-Otter and chairman of the Senate's budget committee.

“I think that progress was being made, but I think that the sheer fact that the House has, in essence, taken away one of the tools that we need to solve this problem is unfortunate at this time.”

Funding for children’s health care and K-12 schools have been the major points of contention this session. Republicans say the state does not have enough money to fully implement a voter-approved expansion of a program providing health coverage to some 30,000 uninsured Montana children. Nor does it have enough state money to fund schools at the level Gov. Brian Schweitzer and Democrats want, they say.

Democrats disagree, saying Republicans are ignoring the will of the voters on children's health care and will also lead K-12 schools over a fiscal cliff if it lowers state funding.

At a Thursday morning budget meeting, House Appropriations Chairman Jon Sesso, D-Butte, did not elaborate on the House’s actions, but instead pushed for full funding in both schools and children’s health insurance. He said there is money available, even if it means not meeting the governor’s goal of keeping $250 million in reserve at the end of session.

“There’s no fix in it unless we come to agreement on these two major issues,” Sesso said.

However, Senate Majority Leader Jim Peterson, R-Buffalo, said he was “disappointed” in the House’s decision on HB 676, and added that it would not help lawmakers finish their task of creating a state budget by the 90th legislative day.

There will be significant funding changes if HB 676 does not pass. A 2 percent cut across all state agencies put in place by Senate Republicans earlier in the session would be removed. So would the decreases to the base funding for K-12 school districts.

When the GOP lawmakers decided to lower state K-12 funding and backfill the difference with federal stimulus money, they put language into HB 676 to make this move permanent. This would mean the reduction in state funding would be permanent when federal dollars disappear in two years. Without HB 676, the reduction would only apply to this biennium.

HB 676 also allows the state to use money from a special revenue fund to pay for the Healthy Montana Kids Plan. Bergren said this language could be put in the stimulus bill.

The bill also allows Montanans covered by Children’s Health Insurance Plan to use CHIP money for contraception.

As of Thursday afternoon, conference committees took no further action on the nearly $8 billion budget bill or companion legislation to spend nearly $800 million in federal stimulus dollars.

The 2007 Legislature was the first in Montana’s history to finish a 90-day session without fulfilling its principal constitutional duty to create a state budget.

Governor blasts GOP budget and stimulus plans

By MOLLY PRIDDY
Community News Service
UM School of Journalism

HELENA – As bills to spend billions of state and federal tax dollars work their way through Legislature’s final days, Gov. Brian Schweitzer is making it clear that he’s not pleased with what he sees heading his way.

“This session, if it ended today, would be less successful than the last legislative session,” Schweitzer said in an interview this week. “The major funding bills are not anywhere close to a condition where we could support them.”

The governor is especially miffed with Senate Republicans who reduced funding for a voter-approved program to expand health coverage for another 30,000 uninsured Montana children. Their plan would add cover about 15,000 additional children. Nor is he happy with the GOP plan to spend less ongoing state money on K-12 schools.

But if you really want to set him off, ask him what he thinks of GOP’s plan to dole out nearly $800 million in federal stimulus dollars provided in the Obama administration’s Recovery Act.

“The money that is contained in (that bill), violates the principal of the Recovery Act, and we would run a very high risk of being forced to send the money back to Washington, D.C.,” Schweitzer said. “There is an inadequate investment in education and health care.”

Senate Republicans fired back, saying the criticism comes from an absent governor who did not offer suggestions about how to solve problems earlier in the session. They also said their amendments to the bill fund both health care and education responsibly, given the recession.

“Education is funded at the level he funded it at in his budget,” said Senate President Bob Story, R-Park City.

That’s technically true, but the clash over of how Democrats and Republicans want to fund schools has implications for the future.

Schweitzer’s proposed budget would give school districts a 3 percent increase in ongoing state money for their base budgets and 3 percent increase for per student payments. That money would be a permanent increase, unless some future Legislature votes to cut it.

But Senate Republicans fear that if the economy doesn’t improve and state tax coffers shrink over the next two years, lawmakers could be forced to either slash school funding or raise taxes, something neither party wants to do.

The GOP solution is to give school districts the same amount as the governor proposed but with one important difference: The bulk of it would come from one-time federal stimulus money – money that won’t be there in two years.

That means that if the economy doesn’t improve, schools had better start looking for ways to cut their budgets. Senate Majority Leader Jim Peterson, R-Buffalo, said the GOP plan gives schools time to consider changes, if necessary.

“We’re not underfunding education,” Peterson said. “The only debated issue is where should the base (increases) be two years from now.”

Another simmering feud between Schweitzer and GOP leaders is over the doling out federal stimulus dollars to cities and counties for “shovel-ready” infrastructure projects, such as road and bridge work.

The governor wants legislation that spells out each single project. Senate Republican want to give local governments block grants so they can decide how to best spend the money.

Story said the change was made to protect the money so Schweitzer could not pick and choose which project to veto when it’s time to sign the stimulus bill.

That’s “ridiculous,” Schweitzer said during Wednesday’s interview. To make his point, he produced a 60-plus page copy of the main budget bill, tossed it on the table and began pointing out various line items and their costs. That system allows for transparency, Schweitzer said.

“This is the way we appropriate money in Montana,” Schweitzer said. “The Recovery Act is not going to allow states to just shovel money out of a window in the dark of night and I, as the governor who signed the letter accepting responsible for these recovery dollars, will not sign such a bill.”

As one of the few states in the country not facing billions in deficits, Schweitzer said mistreatment of federal dollars could put Montana’s relatively sound economy at risk.

“I’m not going to allow a few members of the Legislature to put Montana in a difficult situation,” he said.

But Peterson and Story said the governor is wrong in his concern about transparency. Any city or county applying for the money would have to go through the Department of Commerce, Peterson said, a function of the governor’s office.

“This is a better way,” Peterson said. “You can see that it’s even more transparent.”

Budget matters aren’t the governor’s only concerns as the Legislature heads down the homestretch. He’s also frustrated with Republicans who blocked his bill to set govern “carbon sequestration,” a fledgling technology to capture and store underground the carbon dioxide emitted by coal-fired power plants.

Republican Sen. Keith Bales, R-Otter, drew Schweitzer’s anger after Bales sponsored the GOP version of a carbon sequestration bill. Both bills were tabled amid partisan differences centering on who would authorize permits and the state’s ultimate liability for any environmental damage the process might cause.

“He couldn’t answer questions about his own bill,” Schweitzer said of Bales.

The governor accused Republicans of purposefully bringing forward a bad sequestration bill, knowing full well it would die but earning credit for proposing it.

“These are the same cats that voted against the ‘clean and green’ tax policy that we had in the last legislative session that’s already brought about $1 billion worth of investment to Montana,” Schweitzer said.

Peterson disagreed with Schweitzer’s assessment of the sequestration bill.

“There’s nothing wrong with that bill,” Peterson said. “Sen. Bales worked hard on that bill.”

Peterson said the governor’s criticism stems from partisan differences, not content.

“In my mind, it’s all politics,” Peterson said. “The governor needs to govern with a window, not just with a mirror.”

Schweitzer did have some plaudits for Republicans who insisted, as he does, that the budget include a $250 million contingency or “rain day” fund, in case state revenues continue to tumble. Members of the governor’s own party want to spend some of that money now for a variety of projects and causes.

“I’m glad I’ve got ‘em broke in,” Schweitzer said of the Republicans. “I had to veto 19 bills to get my ending fund balance at the end of the last legislative session.”

Peterson and Story said a keeping a reserve at the end of the session makes sense because the economy is still struggling.

“That’s just good business,” Peterson said. “That’s calling a spade a spade.”

Budget and stimulus bills are bound for House-Senate conference committees, whose members are charged with seeking compromises. Story and Peterson predicted reasonable outcomes.

“I think in the end the governor hopefully will be pleased with it,” Peterson said.

GOP rejects pleas to restore money for CHIP, K-12

By MOLLY PRIDDY
Community News Service
UM School of Journalism

HELENA – State senators debated a proposed state budget of nearly $8 billion Thursday, with Democrats trying and failing to insert more money for schools and for children’s health insurance.

Democrats brought amendments to change state funding in the two largest sections of House Bill 2 – health and human services and education.

Senate Minority Leader Carol Williams, D-Missoula, brought the first attempt to fully fund the Healthy Montana Kids Plan. The voter-approved children’s health insurance program expansion was reduced by Republicans who insisted on reaching “structural balance,” meaning the state should not spend more money than it earns in revenue during the next two years.

“I would like to just submit that the kids of Montana are getting sacrificed on the altar of structural balance,” Williams said. “We’re about to say on partisan vote, we don’t care what the voters said.”

Williams also said fully funding the program would provide coverage for 30,000 uninsured children. The GOP plan would cut that number in half.

But Republicans defended their position, saying they are expanding health care coverage for uninsured children from low- and moderate-income families, though not to the threshold the voters approved.

“We are not turning our back on the needy in our state,” said Sen. Dave Lewis, R-Helena. “We’re adding 15,000 children.”

The amendment failed mostly on party lines, 24-26. Sen. John Brueggeman, R-Polson, was the only Republican to vote for the full expansion.

In education, Sen. Bob Hawks, D-Bozeman, proposed raising K-12 funding to offer a 3 percent increase in schools' base budgets and 3 percent increase in per-student support. The Senate's budget committee voted earlier to limit state funding to 1 percent and 1 percent, and to use federal stimulus funds to make up the difference.

Democrats argued that the reduction would be permanent in the next biennium because stimulus dollars are one-time-only funds. Republicans said the school system needs to tighten its belt along with all other state agencies. The amendment failed, 23-27.

Democrats also failed to pass an amendment to exempt the Montana School for the Deaf and Blind from the previously agreed upon 2 percent cut across all state agencies. Sen. Mitch Tropila, D-Great Falls, asked lawmakers to consider the unique challenges these children face.

“I implore you today, please vote with your heart,” Tropila said. “Think of these kids.”

But Republicans said it would be unfair to allow one program to escape the cut.

“I realized that this is a very good school and everything. However, I think that there’s lots of other places that have good arguments too,” said Sen. Keith Bales, R-Otter. “I don’t think we can make any exceptions.”

The amendment died on party lines, 23-27. Tropila later tried similar amendments, but all failed.

Since the budget was amended and passed by the Senate, the House must agree on the amendments before it can go to the governor. However, the budget will most likely be sent to a conference committee consisting of representatives and senators charged with hashing out differences.

House approves 3% increase for K-12 schools

HELENA – The state House gave preliminary approval to a bill that would increase K-12 education funding by 3 percent each year until 2011.

House Bill 15, sponsored by Rep. Dan Villa, D-Anaconda, passed second reading by a vote of 82-18. It is Gov. Brian Schweitzer’s plan to increase the basic entitlement and the total per-student payment by 3 percent in every district across the state.

Villa said the state has increased education funds since last session, and should keep doing so.

“It’s a simple 3 percent,” Villa said. “Here’s an opportunity to keep the momentum going.”

The bill passed with little fuss in the House.

Rep. William Glaser, R-Huntley, said the bill would not fully fund education needs, but he would vote for it because it could work in conjunction with the incoming federal stimulus money.

Rep. Wanda Grinde, D-Billings, said the bill was not perfect and would not give education programs all the money it needs, but it is a good start.

The bill was originally locked up in an 8-8 tie in the education subcommittee, with Republicans opposed. It went to the floor on a second vote from the subcommittee, 11-5.

-by CNS correspondent Molly Priddy