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Balancing Montana’s Budget – Status Update – What do you think?

Montana’s economy is strong; unemployment is low, more Montanans are working today than ever before in our state’s history, wages are increasing, and the state leads the nation in manufacturing growth.

But we also face an unusual budget situation – the revenues that fund statement government do not reflect this growth, and are coming in lower than projected by the legislature. And on the heels of a long and expensive fire season, the state is projected to be in a deficit.

Governor Bullock asked state agencies to submit proposals to reduce their expenditures by up to 10 percent. The state is already operating on a lean budget – in fact there are fewer permanent state employees now than when the governor took office.

The governor has asked legislators to work with him through this process, because there are options to avoid these cuts. Governor Bullock has deep concerns about cuts that will ultimately increase the cost of education and reduce services Montanans depend on, like healthcare, child protection services and public safety.

But if legislators refuse to work with him to find more responsible solutions, he will be forced to make some or all of the cuts, because by law, the state must have a balanced budget.

The governor will be reviewing the recommendations made by the Legislative Finance Committee in the coming days and weeks. It remains his hope that both Democrats and Republicans will come to the table, roll up their sleeves, and find more responsible solutions – including increasing revenues and mitigating the severity of the cuts through transfers.

If these proposed cuts concern you as much as they concern the governor, your legislators need to hear from you. They need to hear from you how concerning it is that local communities will lose the ability to administer essential services for your friends, your families, and your neighbors.

It’s important that you comment directly on the proposed cuts, you can do so at http://www.balancedbudget.mt.gov and contact your representatives in the state legislature http://leg.mt.gov/css/Sessions/65th/roster.asp?HouseID=0&SessionID=111

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Legislative committee votes to work with Bullock on budget cuts

Montana Gov. Steve Bullock might have found his dance partner.

After a grim list of proposed budget cuts released at the start of September, Bullock, a Democrat, has been discussing the possibility of calling the Republican-dominated Legislature back to Helena to figure out ways to offset the reductions, but said he wouldn’t make that decision without a “willing dance partner.”

ERIN LORANGER [email protected] HOLLY MICHELS [email protected]

http://helenair.com/news/state-and-regional/legislative-committee-votes-to-work-with-bullock-on-budget-cuts/article_11826738-d7ad-5515-bbee-df91332c9a70.html#tncms-source=home-top-story-1

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The Potential Impact of Budget Cuts on Montanans

Public Safety

· Reduced services for children in foster care.

· Cuts in Medicaid rates for the elderly and disabled people.

· Eliminated funding for case management services for developmentally disabled and at-risk children.

· Financial stress to rural hospitals, resulting in hospitals shifting costs to people with private health insurance to avoid closing their doors and limiting services available to those needing care.

· Closing 19 Offices of Public Assistance in rural Montana, impacting many families’ ability to access assistance and services.

· Reductions in mental health crisis intervention and chemical dependency treatment.

· Cutbacks to Montana State Prison guards, including opening the state up to risk expensive lawsuits.

· Longer, expensive stays in county jails and further strain on Montana State Prison’s capacity and already limited medical resources.

· Closing the satellite crime lab in Billings.

· Fewer investigative staff in the Human Rights Bureau, reducing the quality of investigations and ability for Montanans to seek cases of alleged discrimination.

Education

· Reduced services and technical support provided to local schools by the Office of Public Instruction.

· Reduced funding to local school districts of $2.9 million year.

· Cuts in funding to all campuses, likely requiring tuition increases for students and a reduction in amount of financial aid available to students.

· Jeopardized federal grant dollars to support career and technical assistance for students.

· Cuts in funding to Montana University System agencies including county extension offices, impacting youth programs like 4H, Ag Experiment stations and noxious weed prevention.

Support for Local Communities

· The closing of several Property Assessment Division Offices, significantly impacting local government funding and services with little to no new property added to tax rolls, lowered quality of appraisals, and little to no defense of taxpayer appeals.

· Inability to provide counties, cities & towns, school districts, and special districts with assistance and training with budget preparation, mill levy calculations, and annual financial report preparations. Local governments would need to use their own dollars to pay for private account firms.

Services for Seniors

· Deep cuts to hospice services.

· Elimination of Medicare prescription drug benefits for over 10,000 low-income seniors.

· Cuts in personal assistance services and community-based services for seniors and people with disabilities, likely forcing more Montanans into nursing home care.

Services for National Guard and Veterans

· Cutting National Guard Scholarships which help National Guard members to attend state colleges and universities and will hurt recruiting efforts to the Montana National Guard.

· Reduced assistance from Veteran Service officers who provide outreach to communities and tribal reservations to assist veterans.

Clean Air and Clean Water

· Limited ability to study and monitor water quality across the state, and for non-profits and the university system to help communities and industrial dischargers meet water quality standards.

· Reduced assistance in Regional Water Offices, resulting in longer processing times for water right permits and subdivision reviews.

· Reduced assistance to handle air pollution issues at the local level.

· Delayed issuing of air quality permits, decreased customer service, and decreased field office support.

· Reduced assistance to validate and track hard rock, opencut, and coal mine bonding and limited ability to apply for and manage federal grants and contracts for Air, Energy, and Mining programs.

· Reducing the Sheridan Groundwater Study, ceasing or putting the cost on local taxpayers for long-term groundwater monitoring in Northeastern Montana.

Tax Refunds

· Cutting staff that collects funding for the state’s Department of Revenue, a loss in revenue measurable to $30-40 million per year.

· Decrease and in some cases elimination of taxpayer services such as walk-in assistance, call-center hours, and delay in tax refunds to taxpayers.

· Hindering the ability to resolve taxpayers who have appealed their tax assessments.

Agriculture

· Fewer dollars available to mitigate noxious weeds.

· Reduced sampling and testing for prohibited materials in animal feed.

· Increases to licensing, assessment, or testing feeds for producers and agribusinesses.

Balancing Montana’s Budget: Facts & Figures

HJ2: the revenue estimate passed by the 2017 legislature. The governor’s office warned throughout the session that legislators were setting unrealistic expectations for revenue collections to avoid making tough decisions and modernizing Montana’s tax system.

SB261: a bill passed during the 2017 legislature that put in place mandatory budget cuts if the revenues to fund government did not come in as projected. Those cuts include a 1% cut to Medicaid provider rates. The governor has no authority to stop these cuts from going into effect.

17-7-140, MCA: the section of Montana law which requires the governor to balance the budget and gives him authority to reduce spending in general fund appropriations up to 10% in the event revenues come in lower than projected by the legislature.

3.47 à 2.99%: as a result of the 1% cut to Medicaid provider rates mandated by the legislature in SB261, there was a loss in federal funding that added up to, including the 1%, a total cut of 3.47%. The Director of the Department of Public Health & Human services recently brought this cut down to 2.99%.

3.9%: Montana’s unemployment rate. While Montana’s economy is very strong, with more people working than ever before, revenues are coming in lower than anticipated.

$4.7 billion: the total budget passed by the 2017 legislature, which was $21.1 million more than the balanced budget originally proposed by the governor.

5%: amount of spending reductions made by state government agencies in the overall budget passed by the 2017 legislature.

10%: the maximum amount of cuts the governor can make for the biennium under 17-17-140, MCA.

$57 million: amount of state money spent fighting fires this year to date. That total is expected to increase.

$67 million: amount of spending reductions triggered by SB261, including $37 million in cuts and a $30 million transfer from the fire fund.

$143 million: the amount of money that must be projected as an ending fund balance ("rainy day fund") in 2019 in order for the budget to be legally balanced.

$227 million: the current budget deficit as projected by the Office of Budget and Program Planning.

$236 million: the total amount of budget cuts proposed by state agencies to the governor for consideration. The governor can adopt some or all of the proposals if the legislature chooses not to work with him to find more responsible solutions.

Thanks to Ken Fichtler, GOED, for providing this information.

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