News Release
Governor Calls Legislature Into Special Session to Address Revenue Shortfalls
6/28/2002
Chuck Swysgood
406-444-3698
mschwarz@state.mt.us
"I commit that our administration will work with the legislature to make the right decisions for the people of Montana," said Governor Martz. "At the same time, we will work with agencies to also identify potential further reductions. Montana will have a structurally balanced budget."
Yesterday, Budget Director Chuck Swysgood reported to the Governor that in addition to already outlined reductions of $38 million -- based on current revenue projections of June 27 -- state government must reduce spending further by $45 million dollars to meet statutory requirements.
"I am asking that all agencies immediately implement the reductions that were recommended by the Budget Office on May 24," said Governor Martz. In addition, she stated that, "with the level of reductions that we are now faced with making, my budget office recommended, and I concurred, that there is no way that our administration can recommend the level of reduction needed while remaining within the statutory parameters outlined. Based on current information, I am calling the legislature into special session to address revenue shortfalls."
The Governor's office has a statutory obligation to reduce budgets, based on MCA 17-7-140, which states that 'the Governor's office shall direct agencies to reduce spending in an amount that ensures that the projected ending general fund balance for the biennium will be at least 1% of all general fund appropriations during the biennium.'
"As income and corporate tax returns have come in throughout the spring, we have seen a trend toward increased refund amounts and lower tax payments. This indicates a loss in income for both individuals and corporations in our state," said Governor Martz.
Governor Martz has limited legislative action in the special session to five areas.
1) Legislation approving fund balance transfers as submitted by the Office of Budget and Program Planning.
2) Legislation reducing general fund expenditures, including general fund expenditures exempted by section 17-7-140 MCA, House Bill 2, any other appropriation bill, statutory appropriation, or language appropriation.
3) Legislation reducing non-general fund appropriations and non-budgeted transfers when the reduction will increase the general fund balance and any necessary statutory amendments to effectuate the legislative reductions.
4) Legislation reducing the general fund shortfall in revenue, and;
5) Legislation amending House Bill 41 and Senate Bill 495 to provide for a guarantee account in the state special revenue fund.
These are painful decisions that affect everyone's lives," said Governor Martz. "I ask the legislators consider reductions that have the most limited impact possible while at the same time assuring that the state remains fiscally responsible."
###
