News & Features

Legislators Prepare for Heated Session

From property taxes to liquor licenses, lawmakers present priorities to Kalispell Chamber of Commerce

As state lawmakers prepare to convene for the 66th session of the Montana Legislature, slated to begin Jan. 7, they’re already facing a cumbersome docket of more than 3,000 draft bills they’ll be tasked with parsing in 90 days or less.

It’s widely agreed that crafting a bill to continue Medicaid expansion will dominate much of the session, and Republican lawmakers serving in various leadership capacities described their priorities for the upcoming session at a recent luncheon meeting organized by the Kalispell Chamber of Commerce. Touching on how to fund critical infrastructure, the burden of ever increasing property taxes, protecting the Flathead Basin from invasive species, streamlining state government to make it more efficient, as well as providing access to affordable healthcare and curbing increasing insurance premiums, the lawmakers predicted a heated session.

Scott Sales, the GOP Senate president from Bozeman, joined Sen. Mark Blasdel, R-Kalispell, who formerly served as Speaker of the House and is currently Senate President Pro-Tempore, and Rep. Mark Noland, R-Bigfork, chair of the House Business and Labor Committee, to discuss the political and economic landscape of Montana as legislators prepare for the 2019 session.

The three GOP lawmakers all described Medicaid expansion as the most likely issue to overshadow the session, with Blasdel calling it the “big elephant in the room,” but they all predicted it would pass in some form.

Medicaid expansion in Montana launched in January 2016, with some counts estimating that more than 96,000 Montana residents are enrolled.

However, the program is scheduled to end next July unless the Republican-led state Legislature renews it. The decision of whether to keep the program created by former President Barack Obama’s Affordable Care Act is expected to be a contentious one.

The program would cost Montana an additional $126 million over 2020 and 2021 as the state takes on a greater share of the costs now covered by the federal government, along with the increasing cost of administering the program, according to a report by the Legislative Fiscal Division.

Those new costs would be partially offset by $11 million in premiums collected and $57 million saved by avoiding enrollments in traditional Medicaid, for which the state pays a higher share of the costs compared to the expansion program, according to the report.

The net cost to the state would be $26 million in 2020 and $33 million in 2021.

The state’s finances are still forecast to be in the black even with the increased expansion costs, the report states. Money from tax collections is expected to rise to $2.6 billion by 2021.

According to Blasdel, continuing Medicaid expansion in its current form will put a larger strain on the state budget, drawing away from funding for senior and disability services, K-12 and higher education, infrastructure, and correction, compensation for which will likely come from tax increases, which he opposes.

“You start adding up all those funds that are coming out of the fishbowl and we don’t have a lot of money left at the end of the day,” Blasdel said. “My big priorities are not raising taxes and living within our means.”

All three lawmakers agreed that adding personal accountability to Medicaid enrollees would play a significant role in upcoming debate over the program’s future, including discussions about adding sideboards like work requirements for able-bodied adults, and asset testing to provide critical services to the citizens who need it most.

Sales said GOP lawmakers are grappling with how to interpret what the failure of Initiative 185, which would have raised tobacco taxes to fund Medicaid expansion, says about constituents’ attitudes toward continuing the program.

“There’s a big debate even in our caucus about what the failure of I-185 meant,” Sales said. “For some it means that voters came out in opposition to Medicaid expansion, but for a lot of others it’s about passing expansion with some reforms in place. I think a lot of those concepts will come forward in the next few months. But this is one issue that’s not going to be solved in the first 20 to 30 days.”

As chair of the House Business and Labor Committee, Noland said he’s already received more than 30 bills to address the state’s liquor licensing laws, a perennial bone of contention in the business community, particularly after Montana lawmakers drastically changed the system by which licenses are obtained from a lottery to a competitive bidding auction.

“I had 162 bills in my committee last session that we had to get through in 90 days. Think about that,” Noland told the audience at the Chamber event. “I try to give everyone a fair amount of time, but liquor takes up the majority of my time.”

Blasdel said he’s hopeful to gain traction improving Montana’s property tax system, which has considerable budgetary significance in a state that operates without a sales tax.

The Montana Constitution, along with state law, requires that the state Department of Revenue periodically reappraise all properties within Montana’s borders. Tax year 2015 was the first time the reappraisal process occurred in a two-year cycle for residential, commercial, industrial, and agricultural property, instead of the previously used six-year cycle, which still applies to forestland. The current forestland cycle runs from 2015 to 2020.

But Blasdel said the two-year cycle isn’t sustainable, particularly in high-growth communities like the Flathead.

“I would really like to take a look at how to cap property tax increases so the state can still get new growth but residents can get some property tax relief,” he said.

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