Havre-area legislators have mixed comments on Gov. Brian Schweitzer’s proposed budget, ranging from an initial endorsement to saying "it’s about time" to showing distrust.
Schweitzer has proposed cutting business equipment taxes and giving a rebate to property tax owners while increasing spending in some departments, cutting state funding — even eliminating it — from others and increasing the total budget by about 2 percent for the next biennium.
“I think that, overall, it’s protecting people in need,” said state Sen. Jonathan Windy Boy, D-Box Elder. “It’s pretty sensible and, to me, it probably would be friendly on both sides of the aisle.”
Incoming Sen. Rowlie Hutton, R-Havre, who won the election on Nov. 2, is not so sure.
“This is my first rodeo, but somebody is not telling the ‘complete truth,'" he said in an e-mailed statement this morning,
Hutton cited a $350-million deficit projected by the Legislative Fiscal Division
“It is going to take all of us working together to come up with the proper solutions,” he said.
Schweitzer says any shortfall should be at most a $30-million deficit based on projected revenues and the 2010-11 state budget.
The Fiscal Division projection is based on a $300 million increase in the 2010-11 budget, an 8.3-percent increase over the $3.6 billion 2010-11 budget Schweitzer cites.
In his proposal, Schweitzer will phase out much of the business equipment tax, increasing the threshold from $20,000 to $500,000 by 2013. He proposes giving a $50 property tax refund in 2012 and $100 in 2013.
His plan would increase funding for K-12 education by $50 million and higher education by $39 million. It would give small increases to some other state departments, while cutting others — including the governor’s office — and eliminating all state spending for the Department of Transportation and cutting the Department of Commerce by more than 28 percent.
Incoming Rep. Kris Hansen, R-Havre, and returning Rep. Tony Belcourt, D-Box Elder, could not be reached for comment on the proposed budget this morning.
Hutton applauded the cuts in the business equipment tax.
“I think our governor is headed in the right direction with the business equipment tax — I call it the ‘Tail light Tax’ because we are seeing business after business leaving the state,” he said.
He said one problem area in the budget is that it does not address underfunding of the state employee retirement system.
“People on both sides agree it is ‘in the tank,’” Hutton said.
Rep. Wendy Warburton, R-Havre, said in an e-mailed statement that Republicans have been trying for years to implement meaningful reductions in business equipment taxes, which she said hurt businesses and thus jobs. Some of those efforts have consistently failed on party lines, she said.
“With the Republican landslide in this year's elections, Montanans sent a clear message that they want less spending, lower taxes and more jobs,” Warburton said. “I'm encouraged to see the governor take note of that and hope to have his cooperation with reaching these goals this session.”
Windy Boy said he is not overly concerned about the tax cuts and slight increases — that is covered by the savings Schweitzer has built into his budgets, he said.
Schweitzer’s 2012-13 budget includes keeping an ending-fund balance of $125 million in 2013. He has cited the $330 million Montana has in the bank now as part of the reason the state was one of two in the nation that balanced their budgets.
“Putting away a rainy-day fund, that helps alleviate some of the stress when there is a suspected shortfall,” Windy Boy said.
He added that he likes the increased investment in many areas such as education.
Windy Boy said that the final budget, however, could look much different.
“This is only a proposed budget,” he said. “What the end result is, after the 90 days, might be a whole different product.”