By Ron VandenBoom
Freshman Rep. Merlin Wolery, R-Rudyard, is as concerned about the state's looming energy crisis and budget crunch as any Montana legislator, but he is able to point to a few bright spots that show some good things are happening.
Wolery points to several pieces of education legislation that, while not answering the shortfall in educational funding, do take positive steps to retain new teachers and increase salaries.
HB-140 by Rep. Masolo, R. Townsend, proposes teachers receive help repaying student loans when they go into subject areas and locations where Montana needs more educators.
HB-42, another Masolo bill, will give a stipend to teachers obtaining National Board Certification.
Wolery also points to his own HB-488 that would encourage school districts to consolidate by extending double payment of basic entitlements from three to six years with a gradual diminishing of payments after three years.
Wolery acknowledges however that whatever good news may be coming out of Helena for education it is overshadowed by the tight budget and what most legislators and school employees believe will be a cut in real dollar funding for education.
The funding measure considered by most legislators, including Wolery, most likely to pass is Gov. Judy Martz's proposal, HB-121, that allocates no increase in the education budget this year and only a 3 percent increase, or about $13 million, for the second half of the biennium.
"I don't see anything out there, just yet, to make it improve," Wolery said, about the budget. "In fact, the situation is where I thought it would be four years ago when we started shutting down mining and logging. And agriculture hasn't made any money for a handful of years either."
Wolery said he has wondered for a long time how the state's budget could appear to be doing so well while at the same time the economy was slowing, farm and ranch prices were down, and major employers were shutting down.
"Capital gains taxes on stock is said to be one of the reasons, but we see where that's going and we just can't live on that any more," Wolery said.
Wolery also agrees that recent tax cuts are a factor in the current crunch with reductions in vehicle taxes alone slicing $5-$8 million annually from the budget.
Other recent cuts include the reduction in the business equipment tax and the abolition of Montana's death tax.
"And we just passed another tax cut bill out of the house of around $800,000 that will reduce fees on big trucks" Wolery said. "The argument was, you don't overtax an industry that's on rubber.'"
Meaning the business could move from Montana to Wyoming in a week.
The goal by the end of the session is to have about $50 million in surplus funds as a cushion through the biennium and current projections show at least $32 million more in cuts are needed to reach the goal.
Wolery however does not favor raising taxes to meet the crunch.
"I didn't run to raise taxes," he said. "Income taxes and property taxes are already too high."
While taxes may not rise, energy prices for more than 250,000 residential customers will after June of 2002. And Wolery believes that an increase of 200 percent is probably optimistic.
The only cushion looming on the legislative horizon are, according to Wolery, "not really very good proposals."
The bill most likely to pass appears to be Republican Sen. Royal Johnson's SB-143. The bill will allow the state to enter into a long-term contract with PP&L to purchase power at the same rate for five years.
The bill would avoid the up and down price fluctuations of buying power as needed on the open market, but would also lock Montana consumers into a long contract at high rates. Montanans would not be able to take advantage of cheaper rates if, during the next five years, prices fall.
Wolery sees the bill as flawed, but one of only two proposals out there addressing the crisis.
Another proposal by Paul Sliter, R. Sommers, would provide for a tax against the source of production that could be funneled back to consumers as a reduction in energy bills. A similar proposal by Rep. Dave Gallik, D. Helena, might also be worth considering, Wolery said, but he has not yet seen either in the form of a bill.
Wolery is realistic about the energy crisis and the budget crunch when looking at what people will remember.
"All the little things that have been done for economic development, whether they're big or little, mean nothing with this energy thing I mean it just wipes it out," Wolery said.
