State revenue estimates have grown, but lawmakers are taking a cautious approach. Will the Legislature pass an infrastructure bill this session? A mail-voting hearing turns heated. And Sally and Chuck remember Bob Ream, on this episode of 'Capitol Talk.'
Sally Mauk: Welcome to "Capitol Talk" our weekly legislative analysis program. I'm Sally Mauk and I'm joined by veteran Capitol Reporter Chuck Johnson of the Bozeman Daily Chronicle. Our colleague Rob Saldin is out of town, but will rejoin us next week.
Chuck, lawmakers got some good news this week about state revenues, a new estimate shows the state will have a $100 million more over the next three years than they thought they were going to have.
Chuck Johnson: Yes, Sally, the state legislature got a report that showed $106 million in additional revenues are forecast over the three year period. And that's up from the $92 or $93 million estimates in January and February. The reaction was kind of interesting. Two of the key money people, the governor's Budget Director Dan villa and the Senate Finance Chair Llew Jones were both reluctant to add that money to the revenue estimates, saying there's a lot of things that could happen. So they didn't fully embrace it.
Now, what will happen is the Legislature will take up the official revenue estimate and right one in the House Taxation committee soon and they will take these numbers and they can modify the revenue estimate. It's a critical number because it determines how much the state can spend. So, it'll be interesting to see if they decide to include it, or a portion of it, or what.
I had a few questions about it just reading it. They based some of the reasons on national trends, including some of President Trump's proposals. Some of them have not passed yet, his tax cuts and the like. Revenue estimates are a best guess, they're often wrong, sometimes right, but its really a crap-shoot. Its a tough decision to make, because who could've forecast two years ago some of the things that would happen with commodity prices in Montana, some of the things that happened with ag prices in Montana. So essentially you're making a guess two-and-a-half to three years year out on what the economy is going to be like.
SM: It does also put in the spotlight Montana's biennial sessions. The fact that the legislature only meets every two years makes it even more difficult to have accurate revenue projections. More difficult than if they were meeting annually.
CJ: That's a really good case for an annual session where the legislature could come in and adjust appropriations if necessary to meet a lower estimate or perhaps vice versa if the revenue estimates are coming in bigger, perhaps they'd increase appropriations. So they get one shot at it and that's it. And the weird thing about House Joint Resolution 2 is that, as a resolution it never has to even leave the house. So many sessions in recent years, the Senate has never even got a vote on the revenue estimate. Yet when there's an action by one house, that becomes the one they use, so we could get an estimate that the Senate never even sees or has any input in. So its a flawed system for sure.
SM: We found out this week, Chuck, that legislative leaders from both parties have been meeting in closed door sessions to try and come up with a compromise infrastructure bill. But that appears to have fallen apart.
CJ: Yeah, I think it was blown to smithereens this week when Democratic leaders found out that some key legislators on the Republican side of the House had come up with their own plan, and they've come up with a bill with $33 million in bonding. Not for major state buildings such as the Romney Hall in Bozeman at the University, or the veterans home in Butte, or several like that. Instead, they come up with relatively small appropriations to school districts for energy and other repairs, and for cities and towns. And according to Democrats, they were talking about a much bigger package with a lot more bonding that included these urban projects. So the Democratic leaders held a press conference and it wouldn't be an exaggeration to say furious at what was going on with the house.
SM: Well, here's how Senate minority leader Jon Sesso reacted to the House Republican plan:
"I thought we were making some progress but as it turns out it looks like they have decided to put their ideology, their definition, their own definition of infrastructure, ahead of what could be a consensus definition that can work for all Montanans, and that's disappointing," Sesso says.
SM: And he went on to say that plan isn't going to pass as is.
CJ: The tricky thing about bonding bills is they put the state in debt to borrow money and it requires a two-thirds supermajority vote in both houses. Now, in defense of the House members, I'm guessing what happened, although they wouldn't confirm this, is they got the word from top leaders that there was no way the House Republican caucus would bond for much more than $33 million, and they didn't like the big buildings, they like the smaller projects. If you remember last session, there was a bonding bill that came towards the end of the session; $150 million infrastructure bill for bonding. Passed the senate, 47-3, died in the House on the last day, failing by one vote to get two-thirds majority. And so the state ended up with no major infrastructure projects. I suspect that that might've been a problem this time. But the other problem they have is, I'm not sure with Democrats opposed to this bill that the House Republicans came up with that that's going to go anywhere either. So are we going to go another session with no infrastructure bills?
SM: If that was the case, that would be a major failure of this legislative session, because the infrastructure needs in the state are great and getting greater by the minute.
CJ: No question about that, Sally, and remember back in 2013, there was an infrastructure bill in 2013 by Duane Ankney of Colstrip and Governor Bullock vetoed that bill after the session ended saying he needed to do so for budget balancing reasons and structural balance reasons to keep a $300 million ending fund balance. So we've gone two straight sessions with nothing but routine infrastructure that comes from coal tax, the trust funds and the like, but it would be a great embarrassment if the Montana Legislature and the governor don't get an infrastructure bill this session.
SM: That's for sure, and Chuck, House Speaker Austin Knudsen has introduced a bill to loan the operators of the coal-fired plants at Colstrip $10 million to keep the older plants there open a while longer. And a representative of one of the plant's owners, Talen Montana, says the plants are losing money and could close soon without some help:
"Its possible that Talen Montana will close in this calendar year, in 2017. Its our hope to be open until July 1, 2022 at the least. And we hope you pass this bill to help us find a way to do that."
SM: But Chuck, a loan is no guarantee that those plants could stay open, there are a lot of factors at play in this industry that Montana has no control of.
CJ: Certainly, Sally. World prices of coal, its international global climate change concerns, the whole utility industry, much of the power is now generated by much cheaper and much cleaner natural gas. So there are many factors at work here and no guarantee that even if the state made the loans that these plants would survive.
SM: Anne Hedges of the Montana Environmental Information Center is worried about the state's liability when and if the Colstrip plants do close:
"There's no guarantee the state of Montana, if something happens to Talen, that the state of Montana isn't going to be left having to pay for Talen's clean up cost and I don't want that to happen."
SM: And Chuck, Montana has a sad history of having to clean up environmental messes left by industry that pulled out.
CJ: We certainly do, Sally, not just Montana cleaning up but the federal government through the EPA if they can't find a responsible party to pick up the cost of Superfund cleanups. We only need to look at the Berkeley Pit in Butte, the asbestos problems up in Libby, the mines up up in Zortman Landusky. As a mining state we're loaded with mines that were never cleaned up and either the state or federal government or others have had to pay many, many millions of dollars to clean them up.
SM: Well Chuck, probably the most contentious hearing this week was in House Judiciary over a bill to allow the May special election to be held with mail ballots only if counties so choose to do that and people who wanted to testify got upset when the committee chairman limited testimony. The room had to be cleared and tempers flared and it seems like the bill shouldn't be so contentious. Most county election officials want it, to save money, but it may fail.
CJ: Hard to say what will happen. Of course, it's a bill that has split the Republican party in the session. A number of Republicans support this bill, its a Republican bill by Senator Steve Fitzpatrick of Great Falls, but the powers that be in the Republican party oppose it, so there was a contentious hearing this week and the judiciary committee had three other bills, most of which were very contentious too, so the chair of the committee, Senator Allen Done, limited time for proponents and opponents. They let people testify and when the time had run out they asked the remaining people to stand up and give their name and where they were from, and Carole Mackin of Helena, who's kind of a watchdog on election issues here, wasn't going to give up her chance to testify and she kept talking over the chairman's admonition. And at some point, he called security to stop her and they had to clear the room and there was chanting in the hall about keeping 305 alive, and so it was a very contentious hearing. But as usual up at the legislature, they don't vote on the bill the same day they hear it, so what will happen to this I don't know. The supporters of the bill feel that they're trying to stall it and if the bill doesn't become law by April 10, counties won't have the option of doing mail ballots for this election. So, this one bears watching down the road. If they pass the it out of Judiciary, then do they send it to Appropriations. Sort of looks like the stall is on but hard to say what will happen.
SM: News in the U.S. House race between Democrat Rob Quist and Republican Greg Gianforte was dominated this week by the disclosure that Quist had gotten behind on his taxes and defaulted on the loan because, according to Quist, of some high medical costs he incurred. And Quist is trying to say that this is an example of what many Montanans face with the rising cost of health care:
"Like a lot of Montana families, my wife and I were forced to make some difficult decisions and we were stuck with tens of thousands of dollars of medical bills and I was unable to keep insurance coverage."
SM: Is this, do you think, Chuck, going to hurt or help Quist?
CJ: That's a good question, Sally, I think it hurts with some people who are saying that it shows that he's not financially responsible, but other people are saying that could happen to any family in Montana if they come across a health crisis and lose a job, get ill, have to pay medical bills, can't afford it. So I think it depends on your political viewpoint where it cuts, but I think it would've been better for Quist to bring this out himself earlier and not have it show up in a newspaper story.
SM: And we should point out that his opponent, Greg Gianforte, also had a tax lien against him, but that was a long time ago, in 1993, and that had come out in the last race that Gianforte ran in the governor's race.
CJ: This is basic opposition research that the two parties nationally and other groups do and I'm sure these were found through Lexus / Nexus search, or someone went to the courthouse and found these. The question is, will there be more of these things to be found for Quist or Gianforte for that matter? I would assume the opposition research people have already done the work on Gianforte and that's where they found the dispute over stream access, but these kind of things can hurt a candidate, and the message that people always say is, get out your story, warts and all, yourself and don't let others bring it out. So, in that sense, its not good for Quist that it showed up like that, but that's how it is.
SM: You can't expect that if you're running for national office that just about anything in your past is not going to surface.
Finally, Chuck, Montana lost one of its best citizens this week when former legislator Bob Ream died. Ream was a well-respected professor at the University of Montana, a pioneering wolf expert, and a passionate conservationist.
CJ: Bob Ream had quite a career beside those things. He was the state Democratic Party chair for a number of years, and on the Fish and Game Commission as well. Bob was a thoughtful legislator and when he got up and spoke in the House, people listened, because he didn't just speak off the cuff without research and when he spoke he had research. People really listened to him on Fish and Wildlife bills in particular, but he also mastered complex issues of taxation and was one of the leading people on that issue. So he was really someone who was versed on a lot of things but I think his true love was wildlife biology and wolf research. And its too bad, Bob Ream was a class act, a gentleman, a nice guy, and certainly one of the brightest legislators I've ever covered.
SM: His legacy will endure as he was a role model to many friends and colleagues and will surely be deeply missed.
"Capitol Talk" is MTPR's weekly legislative news and analysis program. MTPR Senior News Analyst Sally Mauk is joined by veteran Capitol Reporter Chuck Johnson of the Bozeman Daily Chronicle and UM Political Science Professor Rob Saldin.
Tune in to "Capitol Talk" online, or on your radio at 6:35 p.m. every Friday during the session, and again on Sunday at 11:00 a.m.
