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HELENA — In their first public debate, Montana gubernatorial candidates Rick Hill and Steve Bullock tangled Tuesday night over medical marijuana, the state’s business climate and labor policies and their tax relief plans for Montana.

But the hourlong debate at the Helena Middle School auditorium was a mostly polite affair, as the candidates found room for agreement on some issues — and rarely had a sharp exchange.

Hill, the Republican former congressman, cast himself as the candidate supported by business, who could work with both political parties to improve Montana’s business climate and attract investment to boost natural-resource development and, with it, the state’s economy.

Hill pointed to Wyoming, which he said “embraced coal development” 40 years ago and now has a better economy, better-funded schools and higher-paid teachers. Montana has a reputation for stifling business, he said.

“We’re trailing all our neighboring states in creating jobs,” he said. “This has been a pattern in Montana for almost three decades. … We need to find a way to get government to work with people, rather than be a barrier.”

Bullock, the state’s Democratic attorney general, said he doesn’t agree that Montana has a bad business climate and suggested that Republicans are “creating an adverse regulatory climate by saying things are a lot worse than they are.”

Bullock said Hill is “looking in the rear-view mirror of what Montana was 40 years ago,” and that he wants to help small business develop jobs in Montana — but he never said how.

Bullock and Hill are running for Montana’s open governor seat, which is being vacated by Democratic Gov. Brian Schweitzer, who can’t run again because of term limits. Libertarian Ron Vandevender of Cascade also is in the race but wasn’t invited to Tuesday night’s debate, which was sponsored by Helena Independent Record.

Bullock and Hill sparred over their respective property tax proposals. Bullock wants to give homeowners a one-time $400 rebate, while Hill wants to use natural-resource tax revenue to finance lower property tax rates across the board.

A one-time rebate “doesn’t change people’s behavior” and doesn’t provide meaningful tax relief, Hill said.

Bullock said for most families, “400 bucks means something,” and that under Hill’s proposal, the annual savings for a median house would be about $110 a year. More of the relief would end up going to corporations and large homeowners, he said.

Bullock also questioned whether natural-resource revenue would be a reliable source of funding for public schools, given the boom-and-bust nature of oil, gas and coal. He also noted that Hill isn’t proposing increasing state money for schools and said the state needs to “invest in public education” — but didn’t offer any details on what he might propose.

Perhaps the liveliest exchange of the evening came over medical marijuana, with Hill saying the explosive growth in the number of medical-marijuana patients and growing operations in 2009 and 2010 was the biggest law enforcement issue in Montana, yet Bullock as attorney general “didn’t offer any leadership, didn’t come forth with any suggestions” to solve the problem.

“I’m not sure if you were in California or Montana the last two years,” Bullock replied, saying that his office gave more than 100 presentations on the issue around the state and gave lawmakers a four-page memo in 2011 with his ideas for reforms.

The 2011 Legislature ultimately passed a bill placing severe restrictions on medical marijuana.

Hill also dinged Bullock for voting against the leasing of state coal in the Otter Creek Valley to Arch Coal Co. as a member of the Land Board.

Bullock said he had proposed a higher bonus bid, because he didn’t want to give away Montana coal at “fire-sale prices,” and therefore voted against the lower bid that was accepted.

Bullock said he would veto any “right-to-work” bill, which prohibits any job or employer from making union membership a condition of employment. Hill essentially said he would support such a measure, and that states with right-to-work laws have higher incomes than Montana.

On state employee pay, Hill said he hasn’t talked with one legislator who would support a two-year, 5 percent a year pay raise negotiated by the Schweitzer administration and public-sector unions — and that the Legislature, which can accept or reject any raise, should be part of the discussion.

However, he said he would work closely with unions and the Legislature “to make sure that employees are properly compensated.”

“If I’m governor, I’ll insist that we will show respect to state employees,” he said. “We’re not going to politicize their … salaries.”

Bullock said if he’s governor, he’ll propose the “five and five” raise, noting that state employees have gone four years without a raise in base pay.