Bullock defends veto of oil-gas impact fund; E. Montana officials unhappy

2013-05-09T17:20:00Z 2013-06-10T11:32:08Z Bullock defends veto of oil-gas impact fund; E. Montana officials unhappyBy MIKE DENNISON Gazette State Bureau The Billings Gazette

HELENA — Local officials in Eastern Montana’s oil boom cities and counties aren’t happy with Gov. Steve Bullock’s veto this week of a bill creating a $35 million fund for infrastructure projects in these areas.

“It surprised all of us out here,” Sidney Mayor Bret Smelser said Thursday. “All we’re asking for is a little bit of help — and we were promised a little bit of help.”

Bullock said he had to make difficult decisions to keep a sizable, needed cushion in the state budget, and House Bill 218 was one of the casualties.

“When the Legislature leaves town spending more than they brought in, to the tune of $22 million, and leaving an insufficient rainy-day fund — unfortunately, I had to finish the job that they didn’t,” he said.

Bullock, a Democrat, noted that several other bills he signed include millions of dollars for water, sewer and other projects in counties and cities impacted by oil-and-gas development.

He said Republican legislative leaders rejected a proposal to use bonds to finance these projects, instead insisting on cash from the state treasury. Bullock said he supported the bonding proposal.

“Even though we had record low interest rates (to finance bonds), they wouldn’t take it,” he said.

HB218, sponsored by Rep. Duane Ankney, R-Colstrip, was one of 27 bills that Bullock vetoed Monday.

It passed the House last month on a 93-6 vote and the Senate, 48-2. A mail poll of legislators will be conducted on whether they want to try to override Bullock’s veto. At least two-thirds of each body is needed to override the veto.

The bill creates a $35 million, two-year fund to pay for water, sewer, roads, bridges and other infrastructure projects in areas impacted by oil and gas development along the Montana-North Dakota border. Thousands of workers and their families have poured into the area to work in the oil fields.

The state Department of Commerce would decide which projects would receive grants from the fund.

Smelser said Sidney alone has identified $55 million worth of needed infrastructure projects, including a $13 million expansion of its sewage system, to handle the increased population from oil and gas development.

“If this veto doesn’t get overridden, we’re going to have to take some pretty drastic measures out here to see what we can do,” he said. “We’ve already tripled our water and sewage rates, and doubled our water and sewer hook-up fees. …

“I would urge Republicans and Democrats (in the Legislature) to look at this thing again.”

Bullock pointed to three other bills he signed that help finance some water and sewer projects in the oil and gas impacted areas, as well as other parts of the state.

The Treasure State Endowment Program (TSEP) funds $15 million worth of projects in oil and gas counties, and another bill contains $17 million to complete two major rural water projects in north-central and northeastern Montana. A school-funding bill also contains several million dollars for districts impacted by oil and gas development.

Smelser said the rural water projects don’t really help the hardest-hit towns. Only a few of the TSEP grants go to cities and counties near the North Dakota border.

Bullock said his administration worked with a bipartisan group of legislators on a proposal that had identified the greatest needs and would have used a combination of cash and bonds to fund the projects. That proposal was rejected by Republicans at the Legislature, he said.

“That doesn’t mean we won’t continue to invest in oil and gas counties,” he said. “I’m hopeful that the same legislators who wouldn’t look at an overall infrastructure program, will do so next time.”

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