Montana state budget (2010-2011)

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The state of Montana was estimated to be facing a $60 million budget shortfall by mid-2011, according to the a February 2010 forecast by the state's Legislative Fiscal Division.[1] The state received approximately $70 million from the federal government under HR 1596, a $26 billion plan to give states money for Medicaid and education that the President signed into law on August 10, 2010.[2][3]

Going into the fiscal year Montana had a total state debt of $2,568,901,013 when calculated by adding the total of outstanding debt, pension and OPEB UAAL’s, unemployment trust funds and the 2010 budget gap as of July 2010.[4]

2011 State spending & deficit in billions[5]
Total spending Pension Healthcare Education Welfare Protection Transport Deficit Budget gap
$5.4 $0.5 $1.4 $1.0 $0.8 $0.4 $0.7 $4.8 $0.3
2011 Local spending & deficit in billions[5]
Total spending Pension Healthcare Education Welfare Protection Transport Deficit
$3.8 $0 $0.2 $1.4 $0.1 $0.4 $0.2 $1.5

FY2011 State Budget

See also: Archived Montana state budgets

Find the state’s FY2011 Comprehensive Annual Financial Report (CAFR) compiled by the state government online.[6]

At the conclusion of FY2011, the Department of Public Health and Human Services, the state's largest agency, returned nearly $28 million of unspent funds to the state treasury, and the 2013 Legislature would decide where the money goes.[7] As of Sept. 2010, the Legislature’s chief revenue forecaster projected state's projected general fund balance for the FY2010-2011 could be as high as $235.6 million, which was significantly higher than the estimate made in January.[8]

The federal stimulus passed by Congress in August 2010 provided $68 million to the state. Montana received $38 million in Medicaid funding and $30.7 million for education.[9] The U.S. Education Department estimated that the stimulus money would save about 700 of K-12 teachers' jobs in Montana.[9] U.S. Rep Denny Rehberg said of the stimulus, "Montana had a balanced budget, so it's beyond insulting to be forced to pay off California's debts. But that's exactly what Speaker Pelosi was asking taxpayers to did."[9]

In a memo to agency directors and administrators,Gov. Brian Schweitzer, in keeping with 17-7-140 MCA, directed state agencies to manage their budgets in order to reduce general fund expenditures and noting that the reductions, voluntary and otherwise, would total $41.1 million.[10] The Montana Code Annotated 17-7-140 states that "the governor shall ensure that the expenditure of appropriations did not exceed available revenue" and that the governor "shall direct agencies to reduce spending in an amount that ensures that the projected ending general fund balance for the biennium would be at least 1% of all general fund appropriations during the biennium."[11][12]

Gov. Schweitzer cut most executive agencies’ budget by 5 percent in the FY2011 state budget.[13] Cuts included[14]:

  • Nearly $17 million in human-service programs, including cancellation of a $7 million increase in rates paid to nursing homes, groups homes for the disabled, mental health centers and others for their clients funded by Medicaid.
  • Close to $7 million at the Department of Corrections, including elimination of funding to build a new inmate pre-release center in Kalispell and a freeze on per diem payments to some private and locally run prisons and correctional programs.
  • Approximately $7 million of state University System funds.
  • Approximately $4 million in public school funding, including money for school building projects and a portion of block grants that were distributed to school districts statewide.

Union leaders negotiated with the governor and agreed to a pay freeze in exchange for help with health insurance as the recession hit and the state budget situation tightened.[15]

Local budgets

At the annual Montana League of Cities and Towns conference, 250 cities were advised that tough budget times were ahead for the state, which was estimated to be looking at a $400 million deficit in the beginning of the year.[16]

Budget background

See also: Montana state budget

Montana operates on a biennium budget. The biennium includes a 24-month period from July 1st of odd-numbered years to June 30th of odd-numbered years, such as the 2009-11 biennium, which runs from July 1, 2009 to June 30, 2011. According to state law the Governor was required to submit a budget recommendation to the Legislature by November 15 on even numbered years.[17] The state Constitution gives sole authority to the Legislature to appropriate state funds. The House and the Senate review the recommended budget along with any requests made beginning January of the next fiscal year and additional revenue forecasts.[18][19]

Budget figures

The following table provides a history of Montana's expenditures and gross domestic product (GDP).

Fiscal Year Expenditures (billions) GDP (billions)
2000 $5.0[20] $21.4[20]
2001 $5.3[20] $22.5[20]
2002 $5.6[20] $23.6[20]
2003 $5.9[20] $25.5[20]
2004 $6.2[20] $27.5[20]
2005 $6.4[20] $30.0[20]
2006 $6.9[20] $32.0[20]
2007 $7.5[20] $34.3[20]
2008 $8.2[20] $36.7[20]
2009 $8.8*[20] $39.3*[20]
  • NOTE: The figures for FY 2009 were not finalized.

$3.7 Billion General Fund Spending includes:[21]

  • Public Education 34.7%, $1.28 billion
  • Human Services 19%, $704 million
  • Corrections 9.2%, $340 million
  • Higher Education 8.1%, $300 million

$10.7 Billion Total Fund Spending includes:[22]

  • Human Services 29.7%, $3.2 billion
  • Public Education 15%, $1.6 billion

2008-2009 budget crisis

See also: Montana state budget (2008-2009)

Accounting principles

See also: Montana government accounting principles

Tori M. Hunthausen was the Montana Legislative Auditor. The responsibility of the Legislative Audit Division was to conduct financial and compliance, performance, and information system audits of state agencies or their programs, including the university system. Their audit reports were published online. The Legislative Auditor was solely responsible to the Legislative Assembly and was appointed by and operates primarily through the Legislative Audit Committee. The term of office was for two years beginning July 1 of each even numbered year.[23][24]

The Institute for Truth in Accounting (IFTA) rates Montana “Timely” in filing the state’s Comprehensive Annual Financial Report (CAFR) – The annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA did not consider Montana's CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis did not include significant liabilities for the pension plans and for other post employment benefits, such as health care.[25] Montana's CAFRs were published online by the Department of Administration, State Accounting Division, State Accounting Bureau. Mr. Paul Christofferson was Administrator of the Montana State Accounting Division. The Accounting Bureau was responsible for the preparation of the CAFR and auditing all local government entities.[26][27]

Credit Rating Fitch Moody's S&P
Montana[28] AA Aa2 AA

Budget transparency

Montana had no statewide, official spending database online. On January 17, 2009, Montana Senator Joe Balyeat of Bozeman introduced SB 241 the "Taxpayer Right to Know Act." This bill would have created a searchable Website that, among other things, would have listed information about the state's budget. Data would have come from executive, legislative, and judicial agencies, and would have included appropriations, expenditures, and revenue sources. According to Senator Balyeat, that the taxpayers' "constitutional right to know where their money was going was something that we as the people's elected representatives, the legislature, believe was paramount," and "we believe this bill would did exactly that." Given that the "Taxpayer Right to Know Act" had over half of the legislature signed on as co-sponsors, the bill appeared to had had a high probability of passage. However, SB 241 died in committee,[29] as did HJ 43.[30] House Joint Resolution 43 would have mandated that Montana's Legislative Finance Committee evaluate what would be necessary to put a state spending site online. Both bills died in committee during the spring of 2009.[31][32]

Government tools

The following table was helpful in evaluating the level of transparency provided by a state spending and transparency database:

Criteria for evaluating spending databases
State Database Searchability Grants Contracts Line Item Expenditures Dept/Agency Budgets Public Employee Salary
None n/a n/a n/a n/a n/a n/a
See also: Evaluation of Montana state website

Independent transparency sites

The Montana Policy Institute launched a website dedicated to bringing transparency to Montana.[33] MPI had also launched a site dedicated to education transparency, a site which "contains district level revenue and spending data in an easy to use format. It included the ability to compare up to five districts to each other and to state averages across several meaningful criteria and see revenue and spending trends for each district. Additionally, it included information on the ease or difficulty of obtaining publicly available information about on what Montana schools were taxpayer dollars."[34][35]

Public employee salary information

See also: Montana state government salary

Economic stimulus transparency

Montana would receive approximately $70 million from the federal government under H.R. 1586, a $26 billion plan to give states money for Medicaid and education that the President signed into law on August 10, 2010.[36][37]

The Economic Recovery and Reinvestment Act of 2009 designated $787 billion to be spent throughout the U.S. Of that $787 billion stimulus package, it was estimated that 69%, or over $541 billion, would be administered by state governments.[38] Montana would receive an estimated $603,398,241[39]

Two Montana project were noted in Senator Coburn and Senator McCain's "Summertime Blues, 100 stimulus projects that give taxpayers the blues" report. The two projects included Helena’s use of $18,500 to paint a mural on a band shell and Montana State University spending $141,002 to send nine students on a six-week trip to China to study dinosaur fossils.[40]

In September was also revealed that $1 million of stimulus funds had gone unused in 2010 by the Montana Department of Commerce Primary Workforce Training Grant Program due to the recession.[41]

  • Montana established an economic recovery website to show how legislators and government officials in Montana were spending Federal funds.[42]

See also

External links

Additional reading


  1. Associated Press,"Analyst says Montana budget picture worsening, predicts state to hit deficit in 2011," February 9, 2010
  2. Federal Fund Information for States “ARRA FMAP Extension & Education Jobs Fund Totals” Aug. 11, 2010
  3. H.R. 1586
  4. State Budget Solutions “States Hide Trillions in Debt” July 22, 2010
  5. 5.0 5.1 USA Spending, State Guesstimated* Government Spending
  6. FY2011 CAFR
  7. The Billings Gazette "Public Health Dept reverts $28M in unspent funds" Sept. 1, 2011
  8. Cite error: Invalid <ref> tag; no text was provided for refs named news
  9. 9.0 9.1 9.2 The Great Falls Tribune "Montana gets $68 million for teachers, Medicaid" Aug. 11, 2010
  10. Memo from Gov. Schweitzer to Agency Heads April 5, 2010
  11. 17-7-140 MCA
  12. Montana Code Annotated 17-7-140
  13. Billings Gazette "Schweitzer going forward with nearly all proposed $40 million in budget cuts" April 5, 2010
  14. Governor's Reductions
  15. Cite error: Invalid <ref> tag; no text was provided for refs named line
  16. Montana Watchdog, Local officials warned of tough budget times ahead for state, Oct. 7, 2010
  17. National Association of Budget Officers, "Budget Processes in the States," 2008
  18. State of Montana,"TIMETABLE FOR 2011 BIENNIUM EXECUTIVE BUDGET AND 2009 BIENNIUM ACTIONS," January 15,2009
  19. Montana Legislature,"STATE OF MONTANA BUDGET PROCESS," December 7,2007
  20. 20.00 20.01 20.02 20.03 20.04 20.05 20.06 20.07 20.08 20.09 20.10 20.11 20.12 20.13 20.14 20.15 20.16 20.17 20.18 20.19 US Government Spending,"Montana State and Local spending," accessed March 24,2009
  21. Montana Legislative Fiscal Division, "2011 Biennium Budget Overview," June 2009
  22. Montana Legislative Fiscal Division, "2011 Biennium Budget Overview," June 2009
  23. Legislative Audit Division Web site, accessed October 30, 2009
  24. audit reports
  25. Institute for Truth in Accounting, “The Truth About Balanced Budgets—A Fifty State Study,” Page 35
  26. Department of Administration, State Accounting Division, State Accounting Bureau Web site, accessed October 30, 2009
  27. CAFRs
  28. State of Indiana, “State Credit Ratings-as of June 24, 2009"
  29. Bill Status, Senate Bill 241, "Taxpayer Right to Know Act"
  30. Bill Status, House Join Resolution 43
  31. Taxpayer Right to Know Act
  32. SB 241,
  33. Big Sky Search
  34. Montana Policy Institute
  35. Schools Open Montana
  36. Federal Fund Information for States “ARRA FMAP Extension & Education Jobs Fund Totals” Aug. 11, 2010
  37. Cite error: Invalid <ref> tag; no text was provided for refs named HR1596
  38. National Taxpayers Union, "A Letter to the Nation's Governors: Ensure Transparency and Accountability by Posting Stimulus Expenditures Online," March 10, 2009
  39. Wall Street Journal,"Stimulus Spending by State," March 12,2009
  40. Montana Watchdog, Senators criticize 2 Montana projects for using stimulus funds, Aug. 3, 2010
  41. Montana Watchdog, $1 million in stimulus training funds for Montana unused in first year, Sept. 13, 2010
  42. Montana Economic Recovery site