HELENA — The Senate endorsed a pricier version of its school funding package Wednesday despite fears it could increase property taxes by up to $102 million over the next two years.
Most Republicans said they couldn't support the $72 million measure because of its potential impact on local taxpayers, calling it the "wrong way to go at this time" without more information about several significant amendments pushed through by Democrats.
"We've got a Frankenstein monster here," said Sen. Joe Balyeat, R-Bozeman.
Senators endorsed the bill, 28-20, with Sens. Jerry Black, R-Shelby, John Cobb, R-Augusta, and Sam Kitzenberg, R-Glasgow, siding with Democrats. A final vote was expected Thursday.
The measure was an otherwise innocuous school finance bill until last week, when Democrats transformed it into a key piece of the Legislature's response to the state Supreme Court ruling declaring Montana's school funding system unconstitutional.
Sen. Don Ryan, D-Great Falls, amended the bill to include language from his school funding measure and two other proposals related to school employee retirement. Democrats said the move was necessary to circumvent a stalemate in the evenly split House over how much more state aid schools should get.
Republicans called it a calculated maneuver that wrongly circumvented the House.
Jim Standaert, an analyst in the Legislative Fiscal Division, said the bill already had the potential to add about $26 to the annual tax bill of a $100,000 house when it came out of the Senate Finance and Claims Committee on Tuesday.
Further amendments by Democrats on Wednesday more than doubled that tax potential to a total of $102 million over the next two years, Standaert said. Among the changes approved was a provision that would allow school districts to raise property taxes without voter approval to make up for skyrocketing health insurance premiums over the next two years.
A $4.6 million increase in high school per-student funding and language giving schools the authority to use balances from their transportation and retirement accounts for other expenses also were endorsed.
The changes are meant to pacify the education lobby, which threatened on Tuesday to take the state back to court over the bill. They should also give school districts greater budget flexibility while lawmakers craft a new school funding system over the coming years, Ryan said.
"If we slow this down, we've got everybody setting their school budgets," he said. "This is a way to speed that process up."
Republicans argued that budget deadlines don't justify a rush job, and asked for more time to study the proposed amendments and get public comment because of their potential financial impact. Others suggested giving the House a shot at the measure, citing that chamber's extensive work earlier this session on a Senate bill defining the components of quality schools.
"If we had taken a bit more time with this, we could have gotten a better solution," Sen. John Esp, R-Big Timber, said.
Senate Minority Leader Bob Keenan, R-Bigfork, said the bill does nothing to address problems with Montana's current school funding system, but only encourages schools to keep relying too heavily on local property taxes to pay the bills.
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