Showdown: Senate Republicans Stand Firm on Budget Cuts

By Beacon Staff

HELENA – Senate Republicans advanced a budget Thursday that significantly trims the bipartisan compromise that came out of the House — and stood by the politically risky move of cutting the voter-approved expansion of health insurance for children.

Democrats, predictably, pilloried the budget moves. The GOP-led makeover sets up a budget showdown with a House split 50-50 between the parties.

Overall, House Bill 2 spends about $3.2 billion in state money and a total of $7.9 million including federal money. That’s an annual increase of about 1.6 percent from the last budget, and cuts more than $100 million from the House version.

“Agencies will have to do more with less,” said Republican Sen. Keith Bales of Otter, who carried the measure. “There may have to be some scaling back of current services.”

He called it a budget that “satisfies the needs of this biennium but takes into consideration the uncertainties we are facing with our economy at this time. I think this budget does that.”

The budget was approved 26-24, with two Republicans opposing it on grounds it spends too much. One Democrat, Sen. Jonathan Windy Boy of Rocky Boy, voted for it after getting an amendment on the bill to make sure tribes will retain control of a foster care program.

Republicans in control of the chamber argued the state needs to prepare for further downturns in projected revenue as the recession’s full effects on tax collections become evident.

“Is it a cautious, conservative budget? Yes, but look where we are today,” said Senate Majority Leader Jim Peterson. “But we are still able to maintain current government services. I am proud of what we have done here.”

Democrats argued the Senate has no business raiding the special fund for the Children’s Health Insurance Plan that voters set up with last year’s Initiative 155.

The Senate moves scale back CHIP coverage to 200 percent of poverty level instead of the 250 promised in I-155 — although GOP lawmakers point out is still an increase over the current 175 percent of poverty level. The cutback saves more than $30 million in state money.

“Montanans went to the polls and said this is our priority,” argued Senate Minority Leader Carol Williams, unsuccessfully trying to restore the funding in the budget. “This is the first step of telling Montanans that you don’t know what you are talking about.”

In another bill, Senate Republicans will be changing the law to let them take money out of the special fund set up by I-155 and use it for general government.

Other GOP cuts to the House plan force state government to leave many more positions vacant as a cost-saving measure and reduce state funding of K-12 education in favor of using federal stimulus money.

But Republicans were not willing to accept more dramatic cuts that would take spending below the previous budget. Republican state Sen. Greg Hinkle of Thompson Falls mustered less than a dozen votes in attempts to pass double-digit cuts to entire sections of state government.

Democrats said the stimulus money should be used to prop up government programs as a way to offset cuts in the private sector.

“This is a time when we have been provided with extra revenue to help us through hard times. Instead we are cutting government services,” said Sen. Christine Kaufmann, D-Helena. “We are cutting at the very time when our people need it the most.”

Democrats lamented that a carefully crafted compromise from the House was being tossed aside.

“We have significant differences of opinion on this bill, and it is very evident,” Williams said. “We’ve gone from a bill that was very good bipartisan bill, and it is not anymore.”

The full Senate takes up the separate federal stimulus spending plan on Tuesday, when it returns from an Easter break.

House leaders are watching closely, knowing the differences will go to a joint conference committee for negotiations.

House Speaker Bob Bergren, D-Havre, said full I-155 CHIP funding is not just a Democratic priority, but one endorsed by more than two-thirds of voters.

“Obviously, we’ll reject the amendments,” Bergren said. “Hopefully in the end we’ll have cooler heads prevail.”

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