Peaceful session reaches midway point

HELENA - The Montana Legislature has reached the halfway point of the 61st session with accomplishments, pending challenges and a political tone that is distinctly different from the rancorous 2007 session.

"It's been a smooth first half. It's been very congenial," Sen. Greg Barkus, R-Kalispell, said Wednesday. "But we're all still in flux because of the (changing) revenue projections."

"I think things are actually moving along very well," said Rep. Mike Jopek, D-Whitefish. "The comparison in my mind between the last session and this session is like night and day."

The House adjourned for a four-day break after a brief floor session Wednesday morning, having sent non-revenue bills to the Senate before the transmittal deadline. The Senate was expected to continue working on transmitting bills to the House today.

Barkus, Jopek and other Flathead legislators all said that the uncertain outlook for state revenues over the next two years has had a major influence on the session's deliberations.

This session, the Legislative Fiscal Division already has developed four updated revenue forecasts and there have been several hearings on the forecasts since November. In 2007, the first forecast hearing wasn't until March 20, noted Jopek, who is sponsoring the bill that ultimately will settle on a forecast.

Because of the turbulent economy, the forecasts have dropped by a total of about $250 million since November.

"It's trickier this session than it has ever been before," Jopek said. Developing revenue forecasts in such a volatile economy is actually complicated by the federal economic stimulus that will have some effects on tax revenues, Jopek said.

To avoid the potential for special sessions to further cut government spending because of declining revenues over the next two years, lawmakers are setting their sights on having an ending fund balance of $250 million - substantially more than the $80 million balance after the 2007 session.

"That's a tall order, but we want the ability for 'state government] to weather the storm," Jopek said. "We want money in the bank."

Bills with price tags attached have been relatively scarce this session, Barkus said. Most bills that will add to general fund expenditures are likely destined to die in committee.

But there are exceptions. Barkus was successful in amending a bill he sponsored, to add more judges to overloaded districts, in a fashion that it cleared the Senate.

Senate Bill 158 was whittled down in a Joint Appropriations Committee, however, from six to three judges. Additional judges for Cascade, Gallatin, Lewis and Yellowstone counties were eliminated. As the bill is currently written, Flathead, Yellowstone and Lewis and Clark counties each would get one additional judge.

Jopek and other legislators are focused on another major endeavor - mitigating the impacts of a recently completed reappraisal of property values in Montana.

That process is still in its formative stages, Jopek said, with a Joint House and Senate Committee looking for ways to blunt the tax impacts of a reappraisal that accounted for booming values over the last six years, but not sharp declines in values over the last year.

Jopek said most of the valuation increases have been in residential property classes - a total increase of about $28 billion in value mainly driven by $20 billion in new construction over the six-year reappraisal cycle.

Jopek said the committee will consider a variety of exemptions, tax credits and other tools to mitigate the effects of valuation increases, and it will be considering fundamental changes in the way the reappraisal process is carried out and applied.

About 80 percent of residential valuation increases have occurred in just 10 Montana counties, including Flathead County, Jopek said, so the committee will consider whether measures to alleviate tax increases should be applied to just those counties or to all counties.

Sen. Bruce Tutvedt, R-Kalispell, said there also is discussion about whether the reappraisal cycle should be shortened from six years to every one, two or three years.

Shorter reappraisal cycles would more accurately reflect true market conditions, said Tutvedt, who serves on the joint committee with Jopek.

"So if there is a market downturn in the Flathead we would catch that much sooner," Tutvedt said. "I'm sure we're going to use shorter reappraisal cycles."

As a freshman in the Senate, Tutvedt said he is pleased with how well the legislative process seems to be going so far. Much of it has to do with the state's austere fiscal outlook.

"It's easier to be a legislator in a time of declining budgets, I think, because there isn't a lot of money to fight over."

He said bills that are too costly or if they just don't have some bipartisan support have been weeded out in committees.

"We've worked out a lot of lumps in committee," he said.

Tutvedt noted that he has a bill calling on the federal government to proceed with delisting wolves that has won considerable bipartisan support.

Although the measure hasn't gotten much attention, Tutvedt predicts Senate Resolution 15 will become Montana's official statement calling for delisting, as opposed to a bill sponsored by Sen. Joe Balyeat, R-Bozeman, that makes 10th Amendment claims in completely severing the state's ties with the federal government over wolf management.

That bill, Tutvedt said, is "inflammatory and counterproductive."

Balyeat's bill cleared the Senate Fish, Wildlife and Parks Committee on a narrow 5-4 vote. It was passed on to the Senate Finance and Claims Committee, where it likely will die, Tutvedt predicted, mainly because it has costly provisions.

Reporter Jim Mann may be reached at 758-4407 or by e-mail at jmann@dailyinterlake.com