State budget looks strong for next year, analyst says

Town Crier “Briefs from the Region” (1) – 8/13/20

Montana’s budget is strong, say state analysts, but COVID-19 could disrupt that track record in the next few years. The general fund balance is estimated at $452 million, which is enough to cover the decreased revenues brought on by COVID-19, but analysts predict that state expenditures will continue to be higher than revenues through 2023, leading to a projected $253 million shortfall. Montana law requires a balanced state budget. Options on the table for solving this looming deficit include implementing local sales tax, increasing income taxes for those in higher income brackets, and raising property taxes for second homeowners who don’t claim Montana as their primary residence. Some lawmakers, however, are opposed to raising taxes and instead believe the state should simply cut spending.

“There’s a number of us in the Legislature who don’t believe this is a time to raise taxes on anyone in Montana,” said House Speaker Greg Hertz. “Instead of looking at possible tax increases during these uncertain times, I think we really need to focus, just like all Montanans are, on reducing our expenditures.”