City and county leaders have called on Gov. Steve Bullock, House Speaker Austin Knudsen and Senate President Scott Sales to address the state’s revenue shortfall in a special legislative session.
In letters sent last Friday, the Montana League of Cities and Towns and the Montana Association of Counties asked state leaders to prevent a shifting of costs to local governments and to stop a looming loss of essential state services.
“We believe that discussions with the governor’s office, leadership in the House and Senate and MACo will result in proposals that will minimize the disproportionate impacts of spending reductions on those most vulnerable and avoid the unintended consequences of funding cuts that disproportionately shift the burden onto local property taxpayers,” wrote MACo President Bill Barron, a Lake County commissioner.
MACo’s executive committee had a conference call on Oct. 25 with their counterparts in the League of Cities and Towns. According to Barron’s letter, the local government leaders want a special session to address the revenue shortfall, but don’t want the result to be further shifting of state costs to local governments and their property taxpayers.
Both organizations are worried that state government might try to resolve its revenue problem by decreasing the money it is required to share with city and county governments. For example, local governments collect taxes on gambling and motor vehicle registration fees, which they send to Helena. By law, the local governments are entitled to a share of that money, but the state controls the formula for calculating how the county/city shares are calculated.
Writing on behalf of the League of Cities and Towns, its president, Colstrip Mayor John Williams, said: “The proposed cuts submitted by state agencies will result in fewer resources to provide essential services. These cuts will likely result in delays in issuing permits for subdivisions as well as the real threat of fewer dollars available for health care in many of our most rural hospitals.” Williams also cited concern that veterans, children, Montanans with disabilities and family caregivers will lose access to services they need.
“Cities and towns are the economic engine of Montana,” Williams wrote. “Putting these services on the chopping block will cause irreparable harm to our economic future. Communities cannot continue to grow without these services.”
The league letter concludes with a request for a special legislative session to “consider a combination of cuts and new revenue sources to balance the state budget” and “no further cuts” to the local government distribution.
As Gazette readers know, Bullock can summon the Legislature into special session, but he has said he won’t unless a legislative majority first agrees to support a solution that includes adding revenue to the general fund. So far, the Republican majority leaders have refused to support any revenue increases, instead calling for the governor to balance the budget entirely with spending reductions.
Dan Villa, the governor’s budget director, projects that the biennial general fund budget will be $227 million short of its legally required ending fund balance on June 30, 2019.
Public reaction has been overwhelmingly against cuts that would need to be about 10 percent of the entire general fund budget. Worse, programs that receive federal matching dollars would be cut even deeper. For example, most Montana Medicaid services are paid with $2 of federal funds for each $1 the state pays. Losing one state dollar means that Montana health care providers will lose $3 total.
The city and county leaders added their voices to the urgent cry for the Legislature to fix the unworkable budget it approved — and Bullock signed — six months ago. Don’t abdicate responsibility, fix the revenue shortfall together.