Dems, GOP aim for cooperation at Capitol

HELENA — Lawmakers filled the Capitol building this week, marking the beginning of Montana's 63rd Legislature.

The 90-day session convenes under a new governor, Democrat Steve Bullock, who previously served as Montana's attorney general. Republicans control both houses of the Legislature – leaving the legislative and executive branches split between the parties, just as it was in 2011. GOP lawmakers outnumber Democrats 29-21 in the Senate and 61-39 in the House.

Photo by Amy Sisk

The Montana State Capitol will be the scene of political intrigue for the enxt four months.

The parties frequently stood at odds two years ago, with then Gov. Brian Schweitzer vetoing a record 79 bills. Both Republicans and Democrats want to see better cooperation this time around.

"There's fundamental disagreements on the role of government and the size of government," said Senate Majority Leader Art Wittich, R-Bozeman. "But what we have in common is even though we want to get there in a different way, we want to grow the economy in the state."

For his part, Bullock has also expressed a willingness to work with Republicans. And, he too focused on the economy and jobs when he unveiled his budget on the Friday before the start of the session, stressing the need for structural balance.

"Just as a family can't spend more than it brings in, Montanans expect the same from their government," he said.

So far, lawmakers have proposed 1,800 bills to consider, covering a wide range of topics. But already, several issues are leading the early discussions and promise to be headliners for the session. Here's a snapshot of those issues:

BUDGET SURPLUS — The state of Montana currently holds a more than $400 million budget surplus and how to spend, or save, that money will be at the center of most of the conversations at the Capitol over the next four months. Lawmakers on both sides of the aisle want to return some of that money to taxpayers and address unfunded liabilities.

TAXES — Bullock wants to send a one-time $400 tax rebate to property owners. Many Republicans also want to reduce the burden on owners, although some prefer a more permanent solution to lower property taxes.

"Rather than having one-time gimmicks, I'd rather us focus on true reform of the tax code," Wittich said, adding that he would like to see the people who pay the most see the greatest benefit in return.

Others on the Democratic side support the governor's proposal.

"I think it has the advantage of spending money we know we have and doesn't change the income stream we rely on," said Senate Minority Leader Jon Sesso, D-Butte.

The governor also wants to eliminate the business equipment tax for 11,000 businesses with less than $100,000 in equipment. Currently, businesses with less than $20,000 in equipment are exempt from the tax. Also watch for proposals to do away with the tax entirely.

MEDICAID — Lawmakers in Washington left it up to each state whether to expand Medicaid by accepting federal money from the Affordable Care Act, also known as Obamacare. If the Montana Legislature approves the expansion, more than 50,000 additional people with low incomes could receive health care benefits. The federal government would pick up the entire tab until 2017, then reduce its share to 90 percent. The state would pay the remaining 10 percent.

While Bullock's proposed budget supports the federally funded Medicaid expansion, the measure could see resistance from Republicans concerned about the uncertain economic climate in Washington and the federal government's ability to uphold its financial commitment.

"You are looking at probably one of the largest expansions of a program the state will see," said Speaker of the House Mark Blasdel, R-Somers. "There's a lot of information that hasn't been distributed yet about how this would be in place and the long-term financial consequences to the state."

HIGHER EDUCATION – Legislators agree that supporting Montana's colleges and universities is necessary to prepare tomorrow's workforce. Look for proposals to freeze tuition and fund construction projects such as a new Missoula College of the University of Montana (formerly known as the College of Technology).

Meanwhile, expect discussions between legislators and the Board of Regents, which governs Montana's public institutions of higher education, on ways to cut costs within the university system.

INFRASTRUCTURE — As thousands of people move to work in the oil fields of the Bakken region in eastern Montana, local governments and school districts are scrambling to meet infrastructure needs. Lawmakers want to provide better support for impacted areas facing housing shortages, worn roads, increased crime and strained utility systems.

Look for proposals to fund a new water and sewage system in Sidney and other projects in the region. Legislators could pay for those measures with treasure state endowment funds, where local governments apply for state money to cover specific infrastructure projects, or a grant program through the oil and gas board.

STATE EMPLOYEES — State employees have not received an across-the-board pay raise in four years. That could change if legislators approve a deal to increase base pay by 5 percent over each of the next two years, as negotiated between Schweitzer and public employee unions in June 2012. Republicans note that some state employees have received additional pay despite the freeze, which they say should be taken into consideration when discussing the deal.

PENSIONS – The pension system for state employees faces a $4 billion budget shortfall over the next 30 years. Lawmakers are discussing a variety of ideas to ensure there's enough money in the bank to pay retirees. They may form a joint committee to look for possible solutions, including increasing contributions from employees and employers, drawing from natural resource revenue and reforming the system to offer what's called a defined contribution plan. State employees currently receive monthly pensions through a plan based on a formula that takes into account their salary and duration of government work. A defined contribution plan would provide employees with a payout when they retire based on the amount of money contributed and investment gains or losses.

These are just some of the hot topics on legislators' minds. (Reporter Amy Sisk can be reached at 425-466-6633 or [email protected]. Follow @amyrsisk on Twitter for the latest from the Capitol.)