The 68th Montana Legislative Session Recap
Dear friends,
The 2023 Montana legislative session adjourned on the 2nd of May. During this session, there were 1,698 bills introduced including over 100 from the Governor’s office to clean up red tape and unnecessary regulations. Of the 1,689 bills introduced, 511 house bills were passed and 293 Senate bills. There were also just over 100 Senate and House resolutions passed.
It is impossible in a brief email to provide a comprehensive view of all the bills the legislature addressed. They covered subjects like abortion, appropriations, aging and long-term care, alcohol and drugs, elections, corrections, mental health, insurance, business, environment, energy, courts, property rights, human rights, education, employment, gaming, housing, sexuality and morality, transgender, medical and hospital, poverty, taxation, water, wildlife, hunting, fishing recreation and many, many, more subjects. In addition to these bills, the legislature appropriated a historic surplus of approximately $3.3 billion and an ongoing based budget of over $14 billion which was an increase of about 14% for the 2025 biennium.
Before I get into specific bills I carried and policies I promoted, I will address how we allocated most of the surplus tax revenues:
Tax relief and rebates to taxpayers ($1.073 billion)
- Rep. Mercer HB 192: Income tax rebates $480 million: Joint filers up to $2,500 and $1,250 for individual filers if they paid that much. This rebate is one-time only (OTO). This rebate should come early in 2024.
- Sen. Beard SB 121: Reduces income tax rate from 6.5% to 5.9%. Total financial relief for Montana taxpayers is about $170 million per year.
- Rep. Welch HB 222 ($284 million) and Rep. Kassmier HB 816 ($100 million) $384 million: $1,400 property tax rebate over 2 years, approx. $700 each year. (OTO).
- Rep. Kassmier: HB 212: Raises exemption for business equipment taxes from $300,000 to $1,000,000. Saves about $9 million ongoing for Montana businesses.
- Rep. Jones: HB 587: Makes a permanent property tax reduction of approximately $30 million statewide and growing over time.
Savings and reserves: ($1.43 Billion)
- Ending fund balance of about $754 million or about 23% of the 2nd year appropriations.
- Budget Stabilization and Reserve Fund (BSRF) about $500 million (HB 424 sets the reserves at 16% of 2nd-year biennium appropriations and requires $1.00 of spending reductions to access $3.00 of reserves.)
- Fire Fund: $180 million (6% of 2nd-year appropriations)
- Once the BSRF is filled, any excess revenue flows 75% to the Capital Development fund and 25% to the general fund. The capital Development fund is also capped at 16% of 2nd-year appropriation. The money in the capital development fund is used for long-range capital projects and maintenance of state properties and is appropriated by the legislature.
Other One Time Only Spending: ($1 billion +)
Rep. Keenan, HB 872: $300 million (OTO) set aside for mental health and long-term capital projects for addressing MT mental health concerns including the Montana State Hospital (MSP). This involves a long-term planning commission to address mental health needs in Montana.
Rep. John Fitzpatrick, HB 817: $180 million (OTO) to replace about 700 beds for the Montana State Prison. The bill also provides upgrades for another 100 beds. The bill sets aside $25 million to buy down the cost and provide low-interest loans for workforce housing within 30 miles of a state-owned facility such as the Montana State Prison.
Rep. Moore (McGillvray, co-sponsor) HB 569: Appropriates $95 million and increases employer contributions to provide a permanent solution to long-term unfunded pension liabilities (debt) in Law enforcement pensions. The bill requires a layered amortization for a 25-year pay off of unfunded liabilities and sets age 50 as the minimum age when you can draw a pension. The bill puts new unfunded liabilities on a 10-year layered amortization schedule.
SB 536 Hertz: $100 million for county (80%) and city (20%) roads. The county money is appropriated through DOT to leverage a 7-1 federal match.
HB 267: $100 million for state roads and bridges through DOT to leverage 7-1.
Other bills addressed affordable Housing, and infrastructure projects throughout the state. A significant number of bills were passed to address affordable housing without monetary appropriations. In my view, much of the money spent on housing will have little impact, the solution is in reducing regulation and allowing the market to work overtime.
Ongoing State Sending:
The $3.3 Billion discussed above was surplus revenue. Ongoing state spending is generally appropriated via House Bill 2 (HB 2), statutory appropriations, about a dozen other major appropriations bills and to a lesser degree bills carried by individual legislators. About 50% of state spending is matched by the Federal government. The total spending for the 25 biennium (July 2023-July 2025) was $14.4 Billion. This spending breaks down as follows:
23 Biennium total spending: $12.6 billion
25 Biennium total spending: $14.18 billion (14.18% increase)
23 Biennium state spending: $6.41 billion
25 Biennium state spending: $7.26 billion (13.2% increase)
All spending breaks down along these lines for all spending (including federal dollars):
Education: 21%
Judiciary: 7%
Natural Resources, transportation: 17%
Health and Human Services: 49%
General Government: 6%
State Spending only breaks down along these lines:
Education 43%
State Personal (wages and benefits for state employees): 16%
Transfers out: Universities, state pensions, capital accounts: 16%
Benefit and Claims: mostly medical benefits provided to citizens: 13.3%
Operating expenses: (heat, lights, maintenance, rents): 10%
Grants to local entities: 1.5%
General Fund (state) revenue estimate ($7.4 billion for the biennium):
Income taxes: 64%
Property taxes 9% (The majority of your property taxes are County, City and School taxes, look at your property tax bill for the details)
Corporate Income tax 8%
Vehicle taxes and fees 3%
Insurance taxes 2%
Gaming taxes 2%
Oil and natural gas 2%
Remaining about 10%
As you can see, the state is heavily dependent on income taxes. This should be kept in consideration for future income tax cuts.
My role in the 68th legislative session involved the following committee assignments:
Chairman of Committee on Committees. Committee on Committees assigns all the committees and the chairs of Senate committees during the legislative session. It also appoints administrative committees (like Audit and Finance) and all Interim Committees. The Committee on Committees is elected by the Senate majority caucus.
Chairman of Public Health. This committee hears bills on abortion, human sexuality, public health, mental health, tobacco, insurance bills, long-term care and more. The committee also confirms the Governor’s appointments to health boards and the director of the Department of Public Health and Human Services.
Vice Chair of the Judicial branch, Law Enforcement & Justice sub-committee of Senate Finance and Claims. This committee appropriates all money for the Department of Justice (Attorney General), Department of Corrections, Justice (courts), Office of Public Defender, and the Public Service Commission. This subcommittee evaluates the Governor’s budget for these departments, takes testimony, and appropriates money for them.
Chairman: Ethics: The ethics committee hears ethics complaints that are referred to us by Senate Leadership and determine any disciplinary action taken with respect to a member of the Senate.
Member: Rules: The rules committee sets all the rules (based on prior years’ rules) for the legislative session. It hears disputes on rules that are not resolved on the Senate floor.
Majority Whip: This is a leadership role. The whips provide communication between the President Pro Temp and Majority Leader of the Republican Caucus. The whips attend multiple weekly leadership meetings and weekly meetings with the Governor. We also provide coaching for junior members of our caucus.
The following is an abbreviated list of bills I carried in the 68th legislative session:
These bills do not include bills I co-sponsored, amendments made, or bills I worked with other legislators on or carried for House members on the Senate floor.
SJ 2 and SB 211. Both these bills were Convention of States legislation. SJ 2 applied to Congress to call a convention to propose amendments to the U.S. Constitution on fiscal restraints, limit Congresses’ power and jurisdiction and to impose term limits for Congress and federal officials. SB 211 provided a process to appoint commissioners from Montana to a Convention of the States. Unfortunately, neither passed. SJ 2 died on a tie vote of 25-25 in the Senate after passing 26-24 on second reading. With the current debate about raising the federal debt ceiling past $31.4 trillion and debt expected to grow to $51 trillion by 2032, it’s hard to fathom the failure of these two bills. Congress is undisciplined and practices legislative malfeasance. I have no confidence they will address their destructive spending patterns of the last 240 years. The current inflationary spiral over the last several years is a direct consequence of Congress’s failure to address deficit spending, federal monetary policy, and debt. If a convention is called, Montana would want to be at the table and that was what SB 211 provided. Sadly, members of the House Judiciary Committee did not see it that way. They would rather have Montana sit on the sidelines than participate in the most important event addressing the federal constitution (a “convention for proposing amendments” to the US constitution) in the history of the United States since its founding. To my colleagues who oppose the Article V process provided by the framers to address the political dysfunction we are now experiencing, I would ask how is it working to keep thinking things will change when you have 240 years of history that is contrary to your hoped for change? (I suggest reading The High Cost of Good Intentions by John Cogan if you question that last statement.) The state legislature has a duty to check federal power when it is abused. To not act is a dereliction of our constitutional duty. If the country fails, it will be Congress that drives it off the cliff, but it will be the state legislatures that failed to put up the roadblocks.
SB 7: Prison Telecommunications: This bill was a follow-up to a bill I carried last session. The bill sets maximum phone rates and communications fees for inmates in county detention centers and the Montana State Prison. Being able to communicate with family when incarcerated is important for an inmate’s mental health, rehabilitation, and in reducing recidivism rates. The bill was passed and signed by the Governor.
SB 67: The bill revised the schedule of dangerous drugs in Montana. Cases with fentanyl submitted to the Montana crime lab increased by 300% last year. Unfortunately, analogues of fentanyl have proliferated making it difficult for the crime lab and law enforcement to efficiently process these drug cases. The bill updated the list of analogs of fentanyl and other drugs to improve efficiency in the crime lab and aid in the prosecution and conviction of the criminal sale of dangerous drugs in Montana. The bill passed and was signed by the Governor.
SB 73: Legislative Audit Act: This bill clarifies that it is a “duty” for executive office state agencies to provide information to the Legislative Auditor when requested for the purpose of an audit. The Legislative Audit Committee is the only constitutionally mandated committee in Montana. The Audit Act helps the auditor confirm that tax dollars are spent appropriately, that the laws are followed and that agencies are performing efficiently. The bill was passed by the legislature but was vetoed by the Governor. This veto is an affront to the MT constitution which requires the legislature to audit the executive branch of Government. It appears the executive branch is only interested in accountability and transparency on its own terms, not the legislatures or on terms that promote the public interest.
SB 133: This bill eliminated the Board of Horse Racing’s authority over parimutuel sports betting. The bill died in the process.
SB 112: Revise Pharmacist prescribing authority. This will be welcome legislation for many. SB 112 allows pharmacists to prescribe for simple and self-limiting and easy-to-diagnose conditions such as acne, smoking cessation, urinary tract infections, strep, epi-pens and more. This will save Montana’s money, time, and frustration and allows doctors time to focus on more serious illnesses. It allows more access with less cost to health care, particularly in rural areas of Montana. The bill was passed and signed by the Governor. This legislation and other bills passed this session lead the nation in meaningful healthcare reform.
HB 228 and 569: (Co-sponsored with Rep. Terry Moore) Revising Public Penson laws: HB 228 received national attention. It is a leading piece of legislation that requires public pensions to only invest with the consideration of getting the best return for a given risk. In other words, you can’t invest based on a political agenda, woke or otherwise.
SB 564: The Montana Medical Corp Act. SB 564 provides a process for doctors to provide totally free health care. Previously doctors were unwilling to provide health care for free due to litigation concerns. The Act provides a process under the Board of Medical Examiners to provide liability insurance for doctors who are willing to provide free medical procedures and services to individuals under 200% of the federal poverty level. The bill was passed and signed by the Governor.
Finally, I carried SB 534. This was a constitutional amendment that would have been sent to the voters of Montana to take partisan politics out of the redistricting process. The bill fell 4 votes short of the 100 votes needed (2/3) to be put on the ballot. Gerrymandering is hated by all, except a few Republicans, and in Montana, the Democrats love it, as they control the redistricting process. The amendment would have made it fair for all.
I hope to write to you soon about my personal experience in the legislature to give you a better feel of a day in the life of a legislator, until then,
Many blessings,
tm