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How Did the State Budget Get to This Point?

Montana is seeing the inhumane results of the Republican-controlled Legislature’s budget decisions from the 2017 Legislative Session and the Special Session in November. But their poor fiscal management goes back further.

During the 2015 Montana Legislature, Governor Bullock and Democrats constructed a budget that was balanced, fiscally responsible, and kept a $300 million dollar rainy day fund intact. The state budget for Fiscal Year 2016-2017 fully funded services people in our communities depend on and responsibly cut state government. More importantly, this budget maintained a rainy day fund despite the Republican’s attempts to pass 3 different tax cut bills that favored only the wealthy.

That rainy day came. The oil market and other commodity prices, like beef, wheat, and coal, fell out. Oil prices dropped. Revenue from oil and gas dropped 60% from the end 2014 to the end of 2016. In the 2015 Session, Bullock and Democratic lawmakers saw this downward trend within the oil market. Republicans buried their heads in the sand and instead tried to give away millions to corporations and the wealthy. Bullock vetoed all their tax cut bills to maintain Montana’s rainy day fund and keep the budget balanced.

Bullock’s rainy day find worked when oil prices plummeted and state revenues stalled. But that meant  Republican legislators needed to address revenue issues, but they would not listen.

At the start of the 2017 Legislative Session, Governor Bullock proposed a balanced budget that did not spend more than the state took in and again maintained a $300 million dollar raining day fund. Bullock and Democratic Legislators proposed small revenue increases on alcohol, tobacco, and a mere 1% increase for people whose incomes are over $500,000 a year.

This tax proposal would have effectively repealed the “Gianforte Tax Cut” that Congressman Gianforte personally lobbied for himself to receive during the Judy Martz Administration. These increases would have patched the budget until commodity prices increased and gave the state a more stable revenue stream as our population increases and our economy continues to grow and diversify.

Republicans refused to consider the Democrats’ balanced approach. They refused to consider any revenue increase at all. The Montana Republicans have been the majority in the legislature for the past 8 years and are responsible for bleeding away our state revenues to the “Gianforte Tax Cut.”

Deep down, Republicans wanted Montanans to pay for reelecting Steve Bullock as Governor for another four more years. They wanted those who support the Governor to be hit hardest. They killed every revenue bill, including a bipartisan bill to increase the tobacco tax. This proposal would have created around $70 million in revenue over two years for DPHHS. On the same day they killed the tobacco tax, Republicans came out with a fake revenue estimate and designed their own budget based upon “Republican Math.” This false accounting of Montana’s revenue outlook created a $75 million dollar deficit per year, a $150 million deficit for two-year budget. Republicans knew their budget was unbalanced and cause further cuts, so they passed Senate Bill 261, which cut Medicaid provider rates and other healthcare services.

Republicans are the Majority Party in the Legislature. They passed their own unbalanced budget with no democratic votes and threatened Governor Bullock that they would shut down the government rather than doing their jobs to responsibly balance the budget. A classic Republican government shut-down temper tantrum move.

After a catastrophic fire season, the most expensive on record, and revenues well below the Republicans’ fake estimate, the Governor had to call a special session to fix the Republicans majority’s mishandling of the state budget.

During the Special Session, Governor Bullock and Democrats opposed cuts to the Department of Public Health and Human Services and those that are the most vulnerable. They proposed multiple revenue ideas, but again, the Republican leadership opposed any revenue increases.

Montana’s economy continues to expand with record job creation and record low unemployment, but Democrats realize that parts of our tax system are unfair to working-class families, and no longer account for the economic growth we are seeing. Republicans just want further tax cuts for millionaires like Greg Gianforte.

Instead of taking steps to update Montana’s tax system and address revenue shortfalls responsibly, the Republican-controlled Legislature forced the Governor to make cuts to DPHHS, case management, and Medicaid provider rates to legally balance the budget.

By law, the Governor can only cut general fund expenses and he cannot raise revenue on his own. That is why they fall so hard on DPHHS and the most vulnerable Montanans. Rather than allowing these cuts to be reversed if additional revenue came in, the Republicans voted to make these temporary cuts permanent.

This was Republican’s end game all along. There wasn’t a budget problem until Republicans passed a budget that spent too much. But now they could force the deep cuts they wanted all along to programs that help the poor and disabled. They wanted the Governor to be blamed. They wanted all the people who voted for the Governor to suffer. Republicans will make people suffer for political games. We know it’s true, they believe in party over country—and have for many years.

We need next year’s legislature to work with Governor Bullock and Democratic Legislators to build a budget that works for all Montana families. We must work to get more Democrats elected so that we can restore the services Republicans cut. Republicans made these cuts permanent, it will take a legislature to undo the cuts. Even if revenue comes in, the Governor cannot undo these cuts. Democrats are leading an effort to look more holistically at Montana’s revenue structure and this includes undoing the “Gianforte Tax Cut.”

Montana needs a budget that works for everyone. These cuts affect real people. They are our friends, neighbors, and family members. Legislators need to know the real impact of these cuts on Montanans. We need legislators that will rebuild a budget that protects Montana families and restores these services. Governor Bullock’s words are clear:

“I encourage every Montanan to contact their local state representatives to voice their concerns about the Legislature’s budgeting priorities. And if your local state representative doesn’t listen to your concerns or isn’t willing to answer these hard questions with us about our state’s future, I encourage you to vote for legislators who understand the needs of your community.”

If the 2018 elections were not important enough already, we need a legislature that works for all Montanans. Get out and support our democratic legislative candidates. Write a letter to the editor every week, make calls, knock doors, donate money. We can take the legislature back, but it starts with you all. It starts with hard work, late nights, and pizza. It ends with a majority and vital services restored to our fellow Montanans.

If you appreciate an independent voice holding Montana politicians accountable and informing voters, and you can throw a few dollars a month our way, we would certainly appreciate it.

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Nathan Kosted

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