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ICYMI: Billings Gazette calls out GOP For misleading on the state's budget

Who’s telling Montana budget tales?
Billings Gazette // Editorial

Listening to Gov. Steve Bullock and GOP legislative leaders opine on the Montana budget makes one wonder if they are talking about the same state.

“The biggest challenge Montana businesses face is growth itself,” Bullock said in his State of the State speech last month. He called for more job training and apprenticeship programs to fill thousands of openings statewide.

House Speaker Austin Knudsen, R-Culbertson, said in response: “Montanans deserve to know what happened to the huge reserves, and going forward we want more transparency on where Montana’s tax dollars are going to be spent. What we now face is not only a budget crisis, but a management crisis.”

The Democratic governor and the Republican legislative majority have some differing priorities. Yet state budget experts are in relatively close agreement about Montana’s revenue now and projections for the next 2 ½ years.

The state of Montana isn’t broke as four lawmakers contend in their guest opinion elsewhere on this page. The oft-quoted figure of $300 million sometimes referred to as a “rainy day fund” or a “budget surplus” didn’t disappear. The $300 million was a projection – made by the Legislature in early 2015 of how much money would be in the state’s checking account on June 30, 2017, the end of this biennium.

During the past two years, state revenues were less than projected. As of this month, the governor’s budget office expects that the state will have $121.8 million in the bank on June 30. That’s still a healthy ending fund balance.

Bullock insisted on a $300 million projected ending fund balance two years ago, when some Republicans argued that was too much.
 Looks like, a $300 million projected ending fund balance will be enough to keep Montana in the black despite unexpected reductions in revenue from oil and corporate income taxes.

The governor’s budget office and the Legislative Fiscal Division have been surprisingly close this session in their estimates of revenue for the upcoming biennium. Both estimate that general fund revenues will increase slightly in fiscal 2018 and again in 2019.

Unfortunately, after a revenue drop last year, the projections for the next biennium come up short of what’s needed to continue all present services and cover cost inflation. So there will have to be spending cuts, tax increases or some of both.

Lawmakers are reluctant to support tax increases, but they must look at the consequences of cuts, such as deteriorating facilities and shifting more costs to city and county governments and local school districts.

Bullock’s budget includes the expense of servicing the infrastructure bonds he proposed, projects in House Bill 14. Prudent use of bonds for infrastructure will boost the economy as the proceeds are spent to put Montanans to work on facilities that will serve us for generations.

Bullock’s 2018-2019 budget is austere. For example, it includes zero rate increase for Montana Medicaid providers – a hard pill to swallow in tight labor markets like Billings where the cost of employing health professionals and paraprofessionals is rising. Providers fear even deeper cuts that may make it hard to keep serving needy low-income Montanans, especially the elderly Medicaid enrollees who account for about 60 percent of all Montana nursing home residents.

The pain of budget cuts must be minimized. Longstanding needs on infrastructure must be addressed, not postponed another two years.

We call on the Bullock administration and legislative leaders of both parties to put aside their rhetoric on who’s failing to do what, and start coming to agreement on the two-year budget they must finish in less than 55 workdays.

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