Lawmakers: Balancing the budget means sharing pain

Local political leaders and social service providers are waiting for the next legislative session, which begins Monday, with bated breath. Whether it's through program cuts or tax increases, they say, the task of balancing the Montana budget is likely to affect everyone in the state.

"It's definitely going to be the 900- pound gorilla," said Rep. John Musgrove, D-Havre.

Most legislators agree that programs will have to be cut, and many feel it will take a combination of cuts and tax increases to eliminate the state deficit, estimated at more than $200 million.

Lori Evans, Child Care Link program director at District IV Human Resources Development Council, said she is sure programs HRDC provides will see cuts in their state funding.

"The revenue just doesn't exist to escape unscathed," she said.

Musgrove said the same.

"I think it's unrealistic to assume that any agency can come away clean," he said.

Senate Minority Leader Jon Tester, D- Big Sandy, said he thinks balancing the budget will take both budget cuts and new taxes.

"I think we're going to have to do some cutting. The goal is to be strategic about it so it has the least amount of impact on the population," he said.

Blaine County Commissioner Art Kleinjan said he's focusing on several issues. Blaine County wants to "just flat maintain our funding," he said.

Kleinjan, who chairs the boards of both Bear Paw Development Inc. and the Golden Triangle Community Mental Health Center, said he is afraid funding will be cut for both economic development and mental health services.

Hill County Commissioner Pat Conway said he hopes the Legislature doesn't impact local governments negatively.

The biggest concern is that the Legislature doesn't shift the tax burden back onto the counties, he said.

How the budget is balanced could impact many programs, he added. Gov. Judy Martz has suggested taking about $8 million from the Treasure State Endowment Program to help balance the budget.

That could kill a Hill County plan to repair some bridges in Beaver Creek Park past Taylor Road, Conway said.

"So that will just leave us out in the cold," he said.

Rep. Bob Bergren, D-Havre, said tax increases will probably be needed, but "I think that everything should be on the table. I hope that everbody goes down with an open mind to look at the proposals, and there are many."

Musgrove said one way to raise revenue might be to see how successful tax cuts made by the last three legislatures were. If the cuts didn't provide the benefit intended, maybe the taxes should be reinstated, he said.

Havre school Superintendent Kirk Miller, who also chairs the state Board of Public Education, said there are 68 bills proposed that affect education, and the Havre district will be watching them closely.

Probably the most important are three proposing to consolidate school districts, he said. One proposes drawing new districts along county lines; another would redraw the boundaries to create 27 districts in the state.

Miller said he doesn't know what the best solution to consolidation is, but the taxpayers want to know that they are paying for the most efficient system possible, and the education system must try to provide that.

"We owe it to the kids that we serve and to the communities," he said.

Bergren and Tester both said that consolidation is a good idea in some areas, but that providing incentives to consolidate is a better idea than mandating it. Both used the efforts of the Kremlin-Gildford School and Blue Sky, which serves Hingham and Rudyard, to consolidate as an example.

The situations are different in eastern and western Montana, Tester said. Eastern Montana has had declining enrollment in most areas, while the west has had steadier enrollment or even increases.

"It's like all legislation, when you get right down to it. Montana's a big state. You have to look at all areas, look at rural areas, and the impacts of legislation," he said.

Montana State University-Northern Chancellor Alex Capdeville said his biggest concern is whether the university system will take more cuts.

The university system took about half of the actual cuts made during the special legislative session last summer, Capdeville said.

Commissioner of Higher Education Dick Crofts, who recently announced he is leaving the position, said last fall that the university won't ask for an increase, but hopes to keep funding level.

Capdeville said if keeping the same level means the level after the special session - Northern took about $560,000 in cuts - that's the same as a reduction, especially if the university has to cover part or all of payroll increases and inflation.

Another concern raised by both legislators and local politicians and social service providers was the hidden impact of cuts.

Tester used the federal matching dollars for the Childrens Health Insurance Program as an example. For every $19 the state cuts from the program, it loses another $89 provided by the federal government, he said.

Capdeville said the long-term solution to the state's budget problems seems obvious, though no one seems to want to tackle it.

"I think they just need to bite the bullet, look at a new revenue structure, revamp the tax structure," Capdeville said.