HELENA - The biggest task for the Montana Legislature during its 90-day session is to set the state budget for the next two years, and the work is already beginning.
“The system's beginning to work,” said Rep. Llew Jones, R-Conrad. “It's a system based upon debate, and sometimes debate can be a little heated, but I believe the system is working. We are holding the right conversations.”
Jones chairs the House Appropriations Committee, which takes the lead on budget work, along with the Senate Finance and Claims Committee.
They’re currently meeting together in six joint subcommittees, each tasked with taking a deep dive into a specific budget area: general government, health and human services, natural resources, public safety, education and long-range planning.
“They will definitely do the heavy lifting in that area,” said Jones.
In the first two weeks, the subcommittees have heard testimony from the state agencies whose budgets they craft.
They’re expected to continue working through the first 30 to 40 days of the session — into the middle of February — then bring their proposals to the full Appropriations Committee.
One early budget question is how much of the state’s unusually high revenue this year can be credited to “one-time-only” collections.
Jones said estimates show Montana is seeing roughly $3.5 billion in ongoing general fund revenues, compared to about $2.5 billion in one-time-only money.
“We had so much money, largely from the federal emergency, flow into Montana that it caused essentially the income tax systems to burp out what appears to be a one-time-only surplus,” he said. “So we're going to be very cautionary with those dollars.”
Jones said they may focus on using one-time-only dollars for things like rebates, infrastructure investments and trust funds.
He said one big topic of discussion will be how much of the revenue should be redirected in the form of tax relief.
Jones also said he believes the state should be cautious with the budget because financial analysts are talking about the possibility of a recession in the coming years. He said the Legislature will likely plan to direct a large amount of funding to the state’s reserves – something Republican Gov. Greg Gianforte’s budget plan also calls for, though the specific amount may differ.
“If we were not to do so and a recession arrived, we would come up here and we'd be making draconian cuts to areas like health and human services, public safety and schools – they’re the big three spenders,” Jones said.
Rep. Mary Caferro, D-Helena — the Democratic vice-chair of Appropriations — said her party wants to make sure the budget negotiations balance the needs of everyday Montanans.
“We came here with the plan and the plan includes to increase affordable housing and to invest in child care, mental health services and property tax relief,” she said.
Caferro said one of their top issues is increasing Medicaid reimbursement rates for healthcare providers. The Gianforte administration budget does raise those rates, but not as much as Democrats believe is needed.
Caferro also said tax relief needs to be targeted to help the Montanans who need it most.
Caferro said Democrats are watching the possibility of a recession, but revenue numbers are staying strong so far. She said they don’t want the threat of recession to be used as a reason not to make needed investments.
“People who have Alzheimer's need services, children who are dependent on oxygen, they need services,” she said. “That's the priority, not tax breaks for people who don't need them.”
