Just as some college students seem to work best under the pressure of a drop-dead deadline, the Montana Legislature pulled the equivalent of a caffeinated all-nighter last week and turned in a budget-crisis solution that deserves high grades.
First and foremost, in trying to find a way to backfill the $227 million shortfall in the state budget, the Legislature somehow managed to avoid raising taxes — anywhere! Considering how easy it is to spend other people’s money, color us shocked. As Sen. Bob Keenan told the Inter Lake Thursday, “It’s ... a minor miracle that it all came together.”
Democratic Gov. Steve Bullock had initially proposed about $75 million each in tax increases, temporary budget cuts and transfers from specific state accounts into the general and firefighting funds. The Republican-majority Legislature accepted the cuts, and went one step further — making them permanent with House Bill 2.
The rest proved to be a bit more tricky. The Republicans rejected tax increases on rental cars, hotels or anything else, and set to work looking for revenue sources. What they came up with was a creative mix of transfers, IOU’s and arm-twisting.
The most interesting piece of the puzzle came about by leveraging about $30 million in proceeds if the governor negotiates an agreement to extend for 10 years the contract of CoreCivic, which manages a private prison in Shelby.
“We can’t negotiate a prison contract,” House Speaker Austin Knudsen said before the special session began. “But we can incentivize the governor to take a look.”
According to the Associated Press, if the governor does not place $15 million of that money in the state fire fund by next June, the bill triggers further reductions to state agencies. That’s a stick over the governor’s head, but the carrot is that, should the state’s finances improve, the prison bill sets terms for saving some of the money and reversing some of the cuts and transfers.
Meanwhile, Bullock has said he intends to veto legislation that would furlough executive branch employees at a savings of $15 million. He must think that won’t leave the state in the red. We will wait and see. There’s not a lot of wiggle room — and by the way, let’s hope the economy doesn’t go south, or the next “special” session could be just a few months away.