Budget Deal Erodes as Gov. Schweitzer Plans Vetoes

By Beacon Staff

HELENA – A bipartisan budget deal hailed as a seminal achievement before lawmakers adjourned last week began to crumble Wednesday as Gov. Brian Schweitzer promised to start slashing at it with his line-item veto authority.

As the deal erodes, each side is accusing the other of being the first to breaking the compromise.

Schweitzer said that is he free to change the deal because he does not believe that Republican leaders upheld their end of the bargain that was hashed out behind closed doors over the course of many days before the session wrapped.

The governor’s office Wednesday released a signed document it said was a companion to the deal and obligated the GOP leaders to deliver other bills that they never did, along with notes his staffers took from meetings with Republican leaders.

Republican leaders countered that they only promised in some of the cases to bring various pieces to the floor for a vote, and it was up to Schweitzer to deliver enough votes for passage.

But the documents, signed by both sides, appear vague enough to leave room for either side’s story to be true.

Schweitzer said he will start by modifying a piece of the budget plan that aims to transfer excess money out of various accounts in order to make ends meet. The governor has also said he is withholding the right to line-item veto the main budget bill, known as House Bill 2.

The war of words only escalated between each side’s leaders, who less than two weeks ago stood together at a podium and exchanged friendly handshakes to seal the now beleaguered budget deal.

Senate President Jim Peterson said he and House Speaker Mike Milburn told the governor they would only get three bills sought by Schweitzer to the floor for a vote. The governor, however, said the GOP promised to pass and send him a bill that his Department of Revenue wanted to pursue taxation of off-shore corporate earnings in some cases.

“It’s just politics at its worst,” said Peterson, back at home on his ranch planting barley on Wednesday. “He agreed, and he is just reneging. It is that simple. There is no sense in white-washing it.”

Peterson said Republicans never guaranteed to deliver Senate Bill 94, which tax agents said would raise about $3 million by getting profits they believe are being hidden from taxation.

“We didn’t promise to deliver it at all. I asked him where he was going to get the votes. And he said he would take care of it,” Peterson said. “He said, ‘Just be sure they get a vote.’ From my perspective, you can’t trust him. I think this clearly proves it.”

Peterson said lawmakers who have already adjourned are not in a position to do anything to counter the governor’s moves. Republicans, who relied on the various transfers now under fire to balance the budget, suspect Schweitzer will backfill them with projected excess left in the general fund as a cushion.

“He is going to do whatever he pleases. My guess is he is going to do whatever he can to make us look bad. And he is going to take money out of the ending fund balance to make himself look good,” Peterson said. “It doesn’t bother him a bit that he is not honoring the agreement.”