Montana’s tax collections are down. The Short-Term Investment Pool program is offering such weak returns that counties are pulling out their money. And the state’s pension system has lost nearly 21 percent of its value since last year and, at its current rate, will be more than $2 billion in the hole in 30 years. Yet there is little cause for alarm.
How Montana’s government is weathering this recession – the worst in decades – is both unique and enviable when compared to the majority of states. And it has perhaps never been as obvious than in a report released last week by the Pew Center on the States in which 10 states were said to be on the verge of financial collapse.
The list includes the poster boy for budget ruin, California, which despite cuts is still projecting to run up a $14.4 billion deficit (about twice as large as our entire two-year state budget). And it also includes names one would less expect, such as Rhode Island, the country’s smallest state and one of the most poorly managed.
Every two years Montanans send 50 senators and 100 representatives to Helena. Their main job is to craft a state budget within 90 days. They’re lawmakers, but not politicians, and nearly all of them have full-time jobs back home. Their political experience is restricted by term limits, which prohibits any legislator from serving more than eight years in one chamber in any 16-year period, and their pay is roughly $10 an hour. In many ways they’re amateurs.
In larger states, legislatures more closely resemble Congress. Fewer lawmakers have jobs besides those at their respective capitols. They often have large staffs and are considered full-time politicians. They’re the professionals.
What’s interesting is that six of the states that elected these professionals – California, Michigan, Illinois, Florida, New Jersey and Wisconsin – are on Pew’s list of those on the brink of financial collapse. While none of the states, including Montana and several other sparsely populated states, that have what most resemble citizen legislatures made the list.
To be sure, it is more arduous to get the books in order when you’re dealing with more people, agencies, cities and money. But those politicians tasked with doing so also don’t have to worry about a ranch or small business back home.
It’s easy for Montanans to poke fun at their lawmakers. Rep. Joel Boniek rode a steed to work in the waning days of the 2009 session because the Emigrant Republican wanted to cut partisan tension. But despite their petty differences and unfamiliarity with media scrutiny, Montana’s legislators have positioned our state survive this downturn without going bankrupt.
Lawmakers are actually considering mortgaging Capitol buildings in Arizona. In Michigan, state officials are cutting school funding and health care. And in California, the government has gone so far as to issue IOUs because it can’t pay its bills.
As our state’s tax rolls dwindle, it would be easy to panic. Some lawmakers have even speculated that a special session will have to be called to cut more spending. True, the shortfalls could chip away at the state’s $282.4 million ending balance, but not enough to warrant calling legislators back to Helena until they’re regularly scheduled to in 2011. In fact, Montana is in even better shape than at first glance. Along with full coffers, the state has a “rainy-day account” called the coal tax trust fund that is worth $788 million.
There is no need for a special session because, despite their party affiliations, our lawmakers are mostly frugal – partly because they still have real jobs and know the value of the dollar. And judging by the alternative, I’ll take our amateurs any day.