Legislature prepares to compromise on changes

HELENA – After four months and more than 1,300 bills on subjects ranging from pancakes to the death penalty, the Legislature is heading down the homestretch, facing decisions this week on billions of dollars in spending and a measure to hold property taxes in check.

Since the House and Senate disagree on all of those major bills, conference committees of senators and representatives have been charged with ironing out the differences. The key disputes are over education and health care funding.

Those battles began early in the session when Republicans argued against fully funding the voter-approved Healthy Montana Kids Plan, which aimed to provide health-care coverage to some 30,000 uninsured children. The GOP-controlled Senate cut the expansion in half, saying the plan was too expensive during a recession.

Democrats said Republicans are ignoring the will of Montana voters. They also opposed the GOP-controlled Senate's move to reduce ongoing state funding for education and backfill it with one-time-only federal stimulus dollars.

Senate President Bob Story, R-Park City, said late last week that GOP priorities heading into conference committee are simple: reduce state spending and keep the state from spending more money than it earns in revenue.

"We're not particularly interested in funding ongoing programs with one-time money," Story said. "Anything you do in K-12 (funding) that front loads the system is money you can't get back."

Story said the cuts to education and health-care proposals are merely the financial realities Montana faces in a recession. The state spends over half its budget on education and health care, and other agencies cannot afford more cuts, Story said.

But Senate Democrats are digging in their heels, fearing deep budget cuts for K-12 education after the federal dollars disappear in two years.

"People agree with us on these issues," said Senate Minority Leader Carol Williams. "There shouldn't be compromise, and in the end, we have the governor."

Williams said her party would not give up on fully funding the children's health insurance expansion or using more state dollars for K-12 schools.

"For me, it's all or nothing," Williams said. "I just don't feel like I can give up on them yet."

House Democrats, however, appeared more open to compromise, in a House which is split 50-50 between the two parties.

"We'll have to negotiate," said House Speaker Bob Bergren, D-Havre. He said Democrats might support Republican efforts to reduce the business-equipment tax if the GOP is willing to bend on its priorities elsewhere.

"I support it if it's done responsibly," Bergren said.

House Minority Leader Scott Sales, R-Bozeman, said he was not terribly concerned about the content of the spending bills, but was interested in making sure no more money is spent.

"There's a lot of negotiation and compromise," Sales said. "I hope we don't spend more money than we've already spent – what it gets spent on is up for debate."

Sales voted against accepting the $880 million in federal money offered through the Obama administration's economic recovery act. Montana lawmakers used much of that money to float ongoing programs such as education, knowing the money will be gone in two years.

The other partisan fight centers on legislation seeking to lessen the sting of Montana's recent property reappraisal and hold down property-tax increases statewide.

The House version of that bill included increased exemptions for all property owners and reductions in tax rates. It also includes additional help for the elderly, disabled veterans and the working poor.

Senate Republicans amended the bill heavily and removed the specific exemptions for the needy, opting instead to rely on tax-assistance programs already in place. Sen. Jeff Essmann, R-Billings, said the Senate amendments will keep a lid on tax increases.

But Williams and Bergren said the Senate's version generally favors businesses and the wealthy, forcing low-income Montanans to carry the brunt of the reappraisal.

"I cannot support the bill that's out there now," Williams said. She said the conference committee will need to "level things out" to make the bill apply fairly.

In the end, Gov. Brian Schweitzer will have to decide whether to sign that bill and the major spending bills into law. Schweitzer has already expressed disappointment with Republican actions concerning school funding, the Montana Healthy Kids Plan, and the way federal dollars are distributed.

But Story said he is optimistic Schweitzer will approve the compromises lawmakers reach this week.

"It's a budget that will work," Story said. "There's not much room to move."