MTPR

'Capitol Talk': Budget Collision Course, Infrastructure, And The House Election

Jan 6, 2017

This week on "Capitol Talk": Democrats and Republicans are on a collision course over the state budget. The quickly dissipating spirit of cooperation and non-partisanship at the Legislature. The Republican and Democratic rift over infrastructure projects. And the growing number of candidates, both inside and outside the legislature, for Ryan Zinke's soon-to-be-vacant seat.

Sally Mauk: Well Chuck, not surprisingly this first week of the legislative session has focused on the budget, from which all things flow, and it didn't take long for the Republican majority to go after the governor's proposed budget, saying it doesn't make deep enough cuts.

Chuck Johnson: That's right Sally. The governor's budget actually makes about $74 million in cuts, and Republicans want to do about another $50 million in cuts, which the governor's staff says just can't be done — it would be basically cutting down to bones. So this is very early in the session, and some of them might just be jockeying, but clearly there's a mood to cut.

And why are the cuts happening? Well revenues in the fiscal year that ended last June 30 dipped about 4 percent below the previous year because of declining oil and gas prices, and coal prices. So there's a gap in the revenue that needs to be made up.

SM: And Republicans also, Chuck, want state agencies to come to the table with $20 million less than they have right now. That's something that, for one, the governor's Budget Director Dan Villa says is also not possible:

"We can't give that to you today on the third day. It wouldn't be responsible of us to try," Villa said this week.

But Republicans insist it would be responsible.

CJ: They're offering sort of a carrot and stick approach if agencies would agree to do that, make these cuts, they would give them credit for 30 percent of what they gave up the rest of this fiscal year in fiscal 2019. There weren't many takers at the hearing this week. They'd hoped for $20 million in volunteered cuts, and they got $5 million, and most of those came from the legislative and judicial agencies, and the Republican Justice Department headed by Tim Fox and the Office of Public Instruction headed by Republican Elsie Arntzen. So state agencies under Governor Bullock offered very little.

SM: Republicans also vowed, Chuck, to fight the governor's proposed tax increases on the wealthy, which I think would affect less than 2,000 Montanans. And the governor also wants to tax cigarettes, wine and medical marijuana, but Republicans say no new taxes, and that would put a big hole in the governor's budget.

CJ: Yes, that's right. And I don't think these cuts will be acceptable to the governor, and I don't think the proposed tax increases will be acceptable to the Republicans, so they're sort of heading to a collision somewhere this session. Perhaps there are compromises, but I don't really expect Republicans to compromise on raising taxes on the wealthiest. Perhaps they might be wiling to raise cigarette taxes, that's been done in the past. I don't know about medical marijuana, that's an interesting issue. Some of the people that advocate for medical marijuana say don't tax us, you don't tax other prescription drugs. Others are saying go ahead and tax us, that pretty much further ingrains us in state revenue sources, so we'll always be there, you can't try to get rid of us.

SM: Well Rob, the opening day of the session, Republican and Democratic leaders and the governor all called for civility and collaboration and mutual respect to put partisan political interests aside. And I'm not sure that lasted through the ink drying on their speeches.

Rob Saldin: Right, the honeymoon was short-lived, and it's over. I think one of the ways in which we saw that right off the bat was a debate over the rules in the House. Maybe most notably it appears a so the Democrats aren't going to get the so-called "silver bullets" that they did last time, and that allowed them to choose six bills to move out of committee directly to the House floor with a simple majority vote, rather than the usual supermajority.

Now if that's a bit hard to follow, here's what it basically means in practice: It was those silver bullets that allowed an informal coalition of Democrats and moderate Republicans to get things like the Disclose Act, the campaign finance reform bill, and the Medicaid expansion bill out of committee. Those bills of course, went on to become law because of those "silver bullets," when they otherwise would have died in committee. And this session, it looks like the Democrats aren't going to get any of them. On top of that, because the Republicans stuck together in some of these rules votes, it may be an indication of a more united Republican Party than we saw two years ago, though it's far too early to tell for sure.

One other thing, more generally, that I think is kind of contributing to the foul mood in Helena for both Democrats and Republicans alike is an air of uncertainty hanging over everything that happens in this session because of the lack of clarity about what's going to go on in Washington, especially over the Affordable Care Act, aka Obamacare. One of the primary ways in which that law extended health insurance coverage to people who previously didn't have it was by expanding eligibility for Medicaid, the program for low-income people that's jointly run by the federal government and the states. Now, I think there are mixed signals from Washington about how extensive the changes to Obamacare are going to be, but there could be all kinds of significant implications for the states. So this kind of uncertain backdrop just raises a lot of questions and creates a great deal of uncertainty.

SM: And there's one estimate that the Affordable Care Act right now, if that were repealed, would affect over 140,000 Montanans, which is definitely an impact the state would feel.

Chuck, both sides want to pass a major infrastructure bill — something they failed to do last session. But what those projects should be, and how to pay for them are still very much up for debate.

CJ: Yes, Democrats want the infrastructure in general to be not only water and sewage treatment facilities and bridges and roads, but they also believe that part of a state's infrastructure are facilities like Romney Hall, the old gym that Montana State University in Bozeman wants to turn into additional classroom space to help accommodate its overcrowded facilities. And the State Historical Society which wants to build a new museum building. And the third one is the Southwest Montana Veterans Home, and the state would pick up the cost under these proposals to be paid back later by the federal government.

Republicans are more inclined, I think, to not go along with these buildings, but to just focus on roads bridges, water and sewage treatment facilities, and that's really the debate, as well as how to fund it.

SM: Democrats and governor want to use bonding to pay for these projects and Republican Senate President Scott Sales is one of those opposed to using bonding to pay for them unless they're for what he calls critically important projects:

"I don't know of any projects right off the top of my head that qualify under that definition, but if there are some and they were on a standalone bill, I might be persuaded to vote for it," Sales said.

A little wiggle-room there Chuck?

CJ: A little. And I think what he's saying is don't give us a list of big projects all in one, but throw them out one at a time. And I think advocates of infrastructure feel just the opposite, they want to kind of have strength in numbers. So I don't know where it'll go. Of course Scott Sales is president of the Senate and the most powerful person in the Senate, so we'll see what happens.

The other question, besides bonding is how do you raise money. And there is a proposal for a gas tax to raise the tax on fuel — diesel fuel and gas — by a dime a gallon. The last time it was raised was 1992, to help pay for some of these local roads and state highways.

SM: Rob there are at least a half dozen legislators who have ambitions for national office, specifically Congressman Ryan Zinke's seat which will become vacant if and when Zinke is confirmed as the new secretary of the Interior. And the list of candidates for that seat both in and out of the Legislature is growing.

RS: It sure is, and it's a little bit of an unusual dynamic. Usually you have the campaign, you have the election, you put it behind you and you move on to governing. Well, right now, a number of these people in the Legislature are going to be doing both; campaigning for that seat, and trying to govern. In a lot of ways it's not an ideal situation because it raises the question of are they going to be casting votes in the Legislature trying to position themselves for the campaign. I think ideally you'd like to have those separate, but that's the situation that we have before us. But some of the bigger names, especially on the Republican side in the Legislature are running for this seat: Scott Sales, Ed Buttrey for instance.

SM: Musician Rob Quist has thrown his cowboy hat into the ring, and he says he has lots of people encouraging him to run:

"I haven't taken this decision lightly. The support I've been receiving about this has just been overwhelmingly positive," Quist said.

Well, one of those people who supports him is former Governor Brian Schweitzer. He's come out saying Rob Quist would be a great congressman.

RS: Absolutely, and of course that's a welcome endorsement, but in his statement, Schweitzer emphasized Quist's role as an outsider. The problem with that is that it's going to be the party insiders who'll be picking the nominee. These candidates aren't going to be selected through primaries like we're used to, but through party conventions in which a relatively small number of party leaders are going to basically anoint a candidate. This is going to be something like the modern-day equivalent of the old smoke-filled rooms. So running as an outsider when it's the insiders who are in charge, I think probably will be something of a liability. And beyond that, I"m not sure that Quist has any significant history of engagement with the Democratic Party, so it'd kinda be surprising if the state's elite-level Democrats tap an outsider like Quist unless they're really underwhelmed by the other candidates and decide that their best chance is some kind of desperation, shoot the moon strategy.

SM: We'll be following that, as well as the Legislature for the next several weeks.

"Capitol Talk" is MTPR's weekly legislative news and analysis program. MTPR Senior News Analyst Sally Mauk is joined by veteran Capitol Reporter Chuck Johnson of the Bozeman Daily Chronicle and UM Political Science Professor Rob Saldin.

Tune in to "Capitol Talk" online, or on your radio at 6:35 p.m every Friday during the session, and again on Sunday at 11:00 a.m.