GOP Questioning Schweitzer’s Line-item Veto on Tax

By Beacon Staff

HELENA – Republican legislative leaders said Thursday that Gov. Brian Schweitzer may have overstepped his line-item veto authority a day earlier by nixing a new fee on many businesses, a notion the governor quickly contested by pointing to a past court decision on the issue.

The lawmakers asked for a legal opinion from their staffers and made it clear it could lead to a lawsuit over amendatory vetoes Schweitzer has issued. Senate President Jim Peterson said lawmakers will discuss the issue next Friday.

Schweitzer used his line-item veto authority Wednesday to strike a provision embedded in one of the budget bills. The provision would have levied a 2.75 percent tax on workers’ compensation insurance to pay off an old account with the State Fund insurance program.

“This was the most outrageous act by Republican legislators in the dark of night since they pushed utility deregulation through,” Schweitzer said. “I would say I am outraged by that behavior. I have never allowed the Legislature to raise taxes before, and I will not allow these Republicans to raise taxes now.”

Republicans argue the assessment is needed to pay the bills for the old account that currently come out of the state’s general fund. Schweitzer argues it is unfair to levy another tax on businesses since that old account is the state’s responsibility.

The Republicans said that line-item veto authority may only be used on appropriations.

“We think he is overreaching, and we are getting a legal opinion,” said Peterson, a rancher from Buffalo. “It could lead to legal action, because this sets a precedent that undermines the Legislature.”

Schweitzer countered that the Montana Constitution lets him use the authority on anything contained in an appropriations bill, even if it is a policy decision like a tax increase imbedded in a spending measure.

Schweitzer was sued in 2005 by a former Republican lawmaker alleging that a similar move at that time by the governor should be thrown out. The courts backed Schweitzer.

The relevant portion of the Constitution reads “the governor may veto items in appropriation bills, and in such instances the procedure shall be the same as upon veto of an entire bill.”

Schweitzer will be acting on dozens of bills over the next week, including the main spending bill known as House Bill 2. He has already promised to use his line-item veto authority on that measure because he believes that Republicans did not deliver on the totality of the budget deal they reached behind closed doors.

Republicans argued it is Schweitzer who is reneging on the budget deal by striking portions of it.

Schweitzer also vetoed, as promised, House Bill 316 that transferred money from various accounts in order to shore up education funding. He said those other accounts, such as one for tourism promotion, need that money and that he believes there is enough cash in the general fund to backfill the education funding lost by his veto.