Montana Main Street Blog

How the State Government Benefits from the Satterlee decision

State fiscal analysts and lawmakers have been waiting for the decision in Satterlee to come out because the state government's general fund would be on the hook for some of the tab. Since the decision would have required payouts to people covered under the Old Fund, the state would have had to pay up to $130 million to pay off the liability. That can erase a budget surplus in Montana pretty quick.

I bet most state lawmakers are happy they don't have to deal with that price tag. Small businesses are celebrating as well.

Governor Finally Sees Work Comp as an Issue

Last week, the Governor's office asked the Montana State Fund to show more information on why work comp rates have doubled since 2000. His tone in the article is rather harsh to the State Fund without looking at the real reasons of increasing costs, including his own opposition to good work comp reform bills and his office's silence on bills that would have raised costs.

In the 2009 Legislative Session, small businesses asked for clarity in the work comp laws regarding issues of course and scope. The bill, SB 371, would have dealt with an area of work comp that has allowed non-work related injuries into the system, thereby driving up costs for Montana businesses. The bill received big bi-partisan support from both houses, but the Governor vetoed the bill. I hope this new concern about work comp rates gets him to reconsider his position on course and scope for the next session. We'll definitely be bringing that one back.  

In other work comp areas, the Governor's office stood silent on legislation that would have raised the cost of work comp rates. The Governor's office is not one to shy away from lobbying on bills in committee, so the lack of any testimony from any executive departments on these bills was interesting. For example, SB 285 would have encouraged more attorney involvement in work comp cases by allowing attorney fee awards in cases where denial of benefits was perfectly reasonable. This would have certainly added cost to work comp costs, but no one from his office opposed the bill.

To be fair, the Governor did start a good council a few years ago to study the cost-drivers in work comp and to build consensus for good reforms. He should probably read some of their findings about medical costs, injury rates and return-to-work problems to find out more about why our rates are the 2nd highest in the country. But when good reforms come his way, he should also really jump on board. Glad to hear he is (hopefully) thinking about reversing his positions on some of these issues.

Climate Change Bill Introduced Today in the Senate

Today the Waxman-Markey climate change bill will be introduced in the Senate. This cap-and-trade scheme may not overtake health care as the top issue, but it is something that should be strongly opposed because it will negatively impact Montana overall without having any real impact on the environment.

Jay Stevens over at Left in the Western Part of Pennsylvania had a post a week ago about our criticisms of the Waxman bill. Even though he spells my name wrong a number of times, I can forgive him for that. What's a little more inexcusable is Steven's numerous errors on the Montana Chamber - U.S. Chamber relationship, the Governor's position on cap-and-trade, and the greenies' claims of net job increases resulting from climate change legislation:

1. We often have to remind people that we are not a "chapter" of the U.S. Chamber, just like local chambers are not a chapter of us. We all have different organizations, missions, and in some cases membership. If this was the first time I had to explain it to Stevens, it wouldn't be a problem. However, he continues to misrepresent this relationship despite our numerous posts explaining this relationship, including one here. We often work together on a variety of business issues, but we are all run separately. In this case, we are working together with the national chamber, but we always reserve the right to take a different course based on the views of our own membership.  

2. Governor Schweitzer has either completely changed his views on cap-and-trade (see here), or he hasn't done a good job explaining his position. You can decide for yourself, but Stevens doesn't see a conflict in these positions.

3. Stevens wonders if the Montana Chamber supports a carbon tax? No.

4. Stevens continues to post nonsense on how cap-and-trade is a path to new jobs. This some how implies our economy will improve with such a bill. Will new jobs be created with the bill - yes. But what is the overall net impact on jobs for Montana and the country? How much more will Montanans pay for gas and electricity? How many jobs will go oversees where energy will be much cheaper (when was the last time a pair of Nikes said "Made-in-America?"). I have not seen one credible projection that says we will see more jobs with cap-and-trade. All of them project significant job losses and higher energy prices. Even the CBO and EPA have put hefty pricetags on the cap-and-trade system.

And for what? A few percentage points decrease over a 50-year period in worldwide carbon emissions? Would Stevens support a health care reform bill that cost hundreds of billions of dollars, left many unemployed, and had very little impact on the number of uninsured Americans? Maybe I shouldn't ask.

5. And finally, Stevens wonders if there may be similar dissension within our own ranks on this issue. Is that real? Absolutely. I don't know of specific businesses, but I'm sure there are a few members that would support cap-and-trade. If we couldn't take a position on an issue without 100% of our membership, we wouldn't be taking any positions.

Just setting the record straight. Stevens seems to be a nice guy, but just a bit hasty to post incorrect info.

Property Tax Reappraisal Problems for Small Businesses

There is a lot of blame being shifted on the issue of property tax reappraisal figures that may cause many Montana small businesses to pay much more on their property tax bill.

Republican leaders called a press conference yesterday to point out this problem, and speculating that a special session may be needed to fix the problem. Many legislators are placing the blame on the Department of Revenue for getting the estimates to them very late and incorrectly. This has led to reappraisal figures that are higher than the Legislature intended.

The Governor placed the blame squarely on the shoulders of the legislature as a whole:

"People who have unfairly had their taxes raised, of course they can protest it. That will work for some. For others, they should look to find a legislature that is more competent than this last one, and they can fix it in the next legislative session."

Wow. Did he really say that?

Whoever is to blame, it appears the Governor and the Department of Revenue are not too anxious to do anything about it. Even in this bad economy, the Governor doesn't appear all too eager to help our the thousands of small businesses that could be hurt by this mistake. His statements go back and forth between saying "there isn't really a problem" to "if there is a problem, it wasn't my fault and I don't want to do anything about it."

We will continue to look at this situation and see whether it merits a call for a special session. Now is not the time to be over-collecting taxes from Montana's job creators.

Thanks to Schweitzer, Rehberg, Tester and Baucus

It's too early to declare victory, but it looks like the GM/Stillwater issue might be heading in the right directionthanks to our Montana elected officials. When GM announced it was breaking its contract with Stillwater Mining (employs 1,300 people with good-paying jobs) and keeping contracts with foreign suppliers after it received billions in taxpayer bailout dollars, our Governor, Congressman and two Senators applied some nice PR pressure to the government-owned car company.

At this point, GM has agreed to start talks again. Like I said - still a long ways out from making this a good situation, but at least things seem to be going in the right direction. Let's keep that pressure on them so people don't think this issue is resolved!

Schweitzer Switch on Cap and Trade

As first reported by Paul Chesser and noted by the Flathead Beacon, Montana Governor Brian Schweitzer appears to have had a change of heart on the issue of cap and trade. Up until last year, the second-term Governor has seemingly done everything possible to promote cap and trade, and push for its passage. So what's up with that?

We have long opposed such a system because it would cost Montana a lot of good paying jobs, cost Montana consumers more in energy prices, and have little to no effect on the issue of climate change. In March of last year, the Montana Chamber organized a "Climate Change Dialogue," which focused solely on the economics of cap and trade (not whether humans were causing global warming) and there were many lawmakers, business people and industry folks in attendance.

The Governor was not present at the event, but one of his top advisors was there. He commented to the press about how the whole event was like the tobacco companies trying to convince people that smoking wasn't bad for them. In this post, I responded to that allegation by noting that the Governor's position (at the time) was more like that of the tobacco example because proponents of cap and trade were ignoring the economic realities of such a system and the science that says it will have little to no effect.

Now don't get me wrong - if the Governor has switched is position and is now opposing cap and trade, that's a good thing. In fact, we may be able to work together on the issue. It just begs the question of why he was such a strong supporter in the past (enough to liken those who take his current position to the tobacco industry) and why the change?

Sign This Petition to Save Montana Mining Jobs

As many of you know, and as we've reported a few times already, GM is seeking to end its contract with Stillwater Mining Company for rhodium and palladium while maintaining its contracts with foreign suppliers in Russia and South Africa. This is after GM received billions in American tax dollars to keep it afloat. Hundreds of good-paying jobs in south-central Montana are at stake here. Representative Denny Rehberg and Governor Brian Schweitzer have already contacted the Obama administration on this issue, but we need Baucus and Tester to do the same.

Please sign this online petition and urge your friends, co-workers and fellow bloggers to do so as well. We need to keep the heat on GM, our federal delegation and the Obama administration. What good is the American Recovery Act and government bailouts if American jobs are lost in this way?

GM: Contracts Kept With Foreign Mines, Not Stillwater Mining

A bankruptcy court petition by General Motors (i.e. Government Motors) has been filed to terminate its contract for palladium and rhodium with Stillwater Mining Company, a great Montana company.  At the same time, no filing has been made to terminate similar contracts with foreign suppliers in places like Russia and South Africa. 

This seems to be quite an affront to American taxpayers and Stillwater Mining Company employees for the sacrifices they have made to keep GM afloat.  For the sake of Montana’s economy, we urge you to contact Montana's federal delegation and the Obama administration to tell them to start paying attention to American jobs during this recession.

Montana State Government Revenues Down

As reported here in today's Helena IR, state government revenue collections aren't quite what the Legislature had hoped for back in April.

At this point, it's impossible to know exactly where the state is financially because the fiscal year just ended on June 30. There will be money that comes in that is 2009 money, not the current fiscal year of 2010. Still, there are signs that collections won't be as high as expected. We may be dipping into that $300 million budget ending-fund balance sooner than many thought.

The shortfall can be attributed to lower collections in personal income taxes, sin taxes, natural resource and oil taxes. Many of the graphs looked okay this time last year, but collections have been way down in the past six months. The state revenue analyst said this made him worry about fiscal year 2010 and 2011.

We can take comfort that Montana isn't seeing the budget woes of states like California. Generally, Montana lags behind the rest of the country when going into a recession and often lags coming out as well. Let's hope Montana leads the country out of this one.

Montana Chamber Releases 2009 Scorecard for Legislators and Governor

Today the Montana Chamber of Commerce released its 2009 Voting Review of the 61^st Legislative Session. The review is the most comprehensive look at the business and economic issues addressed during the 90-day session. Over 100 bills are included in the scorecard, which received national recognition for its scoring methodology after the 2007 session.

“The Montana Chamber Voter Review is a great resource for the businesses and voters in Montana,” said Montana Chamber President/CEO Webb Brown, “it gives the most accurate look at who is pro-business and who is not. We have pioneered a new way to look at legislative work, and many states are following suit.”

The Montana Chamber looked not just at floor votes, but also committee votes and bill sponsorship. This holistic approach has given the most comprehensive look at business issues ranging from work comp to health care to taxes. Legislators were notified of the Montana Chamber position before key votes. The Business Scores for legislators ranged all the way from 0% to 100%.

The Governor was judged on his signing or vetoing of bills, committee action, and bills that originated from his departments and agencies. The Governor’s Business Score was 31%.

“By considering factors beyond floor votes and bill signings, we have been able to more accurately score an individual lawmaker’s philosophy on business, government regulation, and job creation,” said Brown.

To view the Montana Chamber Voting Review, please click here.