Bill Summary – FastDemocracy

68th Legislature                                                                                                 HB 424.1
                                                 HOUSE BILL NO. 424
                    INTRODUCED BY L. JONES, D. BEDEY, J. ESP, J. ELLSWORTH, K. BOGNER
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   A BILL FOR AN ACT ENTITLED: “AN ACT GENERALLY REVISING SUSTAINABILITY OF STATE FINANCE;
   REVISING TRANSFER PERCENTAGES INTO THE BUDGET STABILIZATION RESERVE FUND AND THE
   CAPITAL DEVELOPMENTS LONG-RANGE BUILDING PROGRAM ACCOUNT; INCREASING THE CAP ON
   THE BUDGET STABILIZATION RESERVE FUND; INCREASING THE CAP ON THE FIRE SUPPRESSION
   FUND; ALLOWING THE CAPITAL DEVELOPMENTS LONG-RANGE BUILDING PROGRAM ACCOUNT TO
   PAY ON BONDS AND RELATED COSTS; TEMPORARILY INCREASING THE GOVERNOR'S EMERGENCY
   FUNDS; REQUIRING THAT FUNDS IN THE CAPITAL DEVELOPMENTS LONG-RANGE BUILDING
   PROGRAM ACCOUNT BE USED TO FOREGO OR REDUCE THE AMOUNT OF ISSUANCE OF GENERAL
   OBLIGATION BONDS; PROVIDING FOR GENERAL FUND TRANSFERS INTO THE BUDGET
   STABILIZATION RESERVE FUND AND THE FIRE SUPPRESSION FUND; PROVIDING FOR OTHER
   TRANSFERS FROM THE GENERAL FUND; PROVIDING FOR A STATUTORY APPROPRIATION;
   EXPANDING USES OF A STATUTORY APPROPRIATION; AMENDING SECTIONS 10-3-312, 17-7-102, 17-
   7-130, 17-7-140, 17-7-209, 17-7-502, AND 76-13-150, MCA; AMENDING SECTION 1(2), CHAPTER 476,
   LAWS OF 2019, SECTION 13, CHAPTER 476, LAWS OF 2019, AND SECTION 2(2), CHAPTER 499, LAWS
   OF 2005; AND PROVIDING AN IMMEDIATE EFFECTIVE DATE AND A TERMINATION DATE.”
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   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
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              Section 1. Section 10-3-312, MCA, is amended to read:
              "10-3-312.   Maximum expenditure by governor -- appropriation. (1) Whenever a disaster or an
   emergency, including an energy emergency as defined in 90-4-302 or an invasive species emergency declared
   under 80-7-1013, is declared by the governor, there is statutorily appropriated to the office of the governor, as
   provided in 17-7-502, and, subject to subsection (2), the governor is authorized to expend from the general fund
   an amount not to exceed $16 $32 million in any biennium, minus any amount appropriated pursuant to 10-3-
   310 in the same biennium. The statutory appropriation in this subsection may be used by any state agency
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68th Legislature                                                                                                     HB 424.1
   designated by the governor.
              (2)    In the event of the recovery of money expended under this section, the spending authority must
   be reinstated to a level reflecting the recovery.
              (3)    If a disaster is declared by the president of the United States, there is statutorily appropriated to
   the office of the governor, as provided in 17-7-502, and the governor is authorized to expend from the general
   fund an amount not to exceed $500,000 during the biennium to meet the state's share of the individuals and
   households grant programs as provided in 42 U.S.C. 5174. The statutory appropriation in this subsection may
   be used by any state agency designated by the governor.
              (4)    At the end of each biennium, an amount equal to the unexpended and unencumbered balance
   of the $16 $32 million statutory appropriation in subsection (1), minus any amount appropriated pursuant to 10-
   3-310 in the same biennium, must be transferred by the state treasurer from the state general fund to the fire
   suppression account provided for in 76-13-150."
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              Section 2. Section 17-7-102, MCA, is amended to read:
              "17-7-102.   (Temporary) Definitions. As used in this chapter, the following definitions apply:
              (1)    "Additional services" means different services or more of the same services.
              (2)    "Agency" means all offices, departments, boards, commissions, institutions, universities,
   colleges, and any other person or any other administrative unit of state government that spends or encumbers
   public money by virtue of an appropriation from the legislature under 17-8-101.
              (3)    "Approving authority" means:
              (a)    the governor or the governor's designated representative for executive branch agencies;
              (b)    the chief justice of the supreme court or the chief justice's designated representative for judicial
   branch agencies;
              (c)    the speaker for the house of representatives;
              (d)    the president for the senate;
              (e)    appropriate legislative committees or a designated representative for legislative branch
   agencies; or
              (f)    the board of regents of higher education or its designated representative for the university
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68th Legislature                                                                                                 HB 424.1
   system.
              (4)    (a) "Base budget" means the resources for the operation of state government that are of an
   ongoing and nonextraordinary nature in the current biennium. The base budget for the state general fund and
   state special revenue funds may not exceed that level of funding authorized by the previous legislature.
              (b)    The term does not include:
              (i)    funding for water adjudication if the accountability benchmarks contained in 85-2-271 are not
   met;
              (ii)   funding for petroleum storage tank leak prevention if the accountability benchmarks in 75-11-
   521 are not met.
              (5)    "Budget amendment" means a temporary appropriation as provided in Title 17, chapter 7, part
   4.
              (6)    "Budget stabilization reserve" means the amount of unappropriated fund balance in the budget
   stabilization reserve fund up to 4.5% 12% of all general fund appropriations in the second year of the biennium.
              (7)    "Emergency" means a catastrophe, disaster, calamity, or other serious unforeseen and
   unanticipated circumstance that has occurred subsequent to the time that an agency's appropriation was made,
   that was clearly not within the contemplation of the legislature and the governor, and that affects one or more
   functions of a state agency and the agency's expenditure requirements for the performance of the function or
   functions.
              (8)    "Funds subject to appropriation" means those funds required to be paid out of the treasury as
   set forth in 17-8-101.
              (9)    "Necessary" means essential to the public welfare and of a nature that cannot wait until the
   next legislative session for legislative consideration.
              (10)   "New proposals" means requests to provide new nonmandated services, to change program
   services, to eliminate existing services, or to change sources of funding. For purposes of establishing the
   present law base, the distinction between new proposals and the adjustments to the base budget to develop
   the present law base is to be determined by the existence of constitutional or statutory requirements for the
   proposed expenditure. Any proposed increase or decrease that is not based on those requirements is
   considered a new proposal.
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68th Legislature                                                                                                     HB 424.1
              (11)    "Operating reserve" means an amount equal to 8.3% of all general fund appropriations in the
   second year of the biennium.
              (12)    "Present law base" means that level of funding needed under present law to maintain
   operations and services at the level authorized by the previous legislature, including but not limited to:
              (a)     changes resulting from legally mandated workload, caseload, or enrollment increases or
   decreases;
              (b)     changes in funding requirements resulting from constitutional or statutory schedules or
   formulas;
              (c)     inflationary or deflationary adjustments; and
              (d)     elimination of nonrecurring appropriations.
              (13)    "Program" means a principal organizational or budgetary unit within an agency.
              (14)    "Requesting agency" means the agency of state government that has requested a specific
   budget amendment.
              (15)    "University system unit" means the board of regents of higher education; office of the
   commissioner of higher education; university of Montana, with campuses at Missoula, Butte, Dillon, and
   Helena; Montana state university, with campuses at Bozeman, Billings, Havre, and Great Falls; the agricultural
   experiment station, with central offices at Bozeman; the forest and conservation experiment station, with central
   offices at Missoula; the cooperative extension service, with central offices at Bozeman; the bureau of mines and
   geology, with central offices at Butte; the fire services training school at Great Falls; and the community
   colleges supervised and coordinated by the board of regents pursuant to 20-15-103. (Terminates June 30,
   2028--sec. 11, Ch. 269, L. 2015.)
              17-7-102. (Effective July 1, 2028) Definitions. As used in this chapter, the following definitions
   apply:
              (1)     "Additional services" means different services or more of the same services.
              (2)     "Agency" means all offices, departments, boards, commissions, institutions, universities,
   colleges, and any other person or any other administrative unit of state government that spends or encumbers
   public money by virtue of an appropriation from the legislature under 17-8-101.
              (3)     "Approving authority" means:
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68th Legislature                                                                                                    HB 424.1
              (a)    the governor or the governor's designated representative for executive branch agencies;
              (b)    the chief justice of the supreme court or the chief justice's designated representative for judicial
   branch agencies;
              (c)    the speaker for the house of representatives;
              (d)    the president for the senate;
              (e)    appropriate legislative committees or a designated representative for legislative branch
   agencies; or
              (f)    the board of regents of higher education or its designated representative for the university
   system.
              (4)    "Base budget" means the resources for the operation of state government that are of an
   ongoing and nonextraordinary nature in the current biennium. The base budget for the state general fund and
   state special revenue funds may not exceed that level of funding authorized by the previous legislature.
              (5)    "Budget amendment" means a temporary appropriation as provided in Title 17, chapter 7, part
   4.
              (6)    "Budget stabilization reserve" means the amount of unappropriated fund balance in the budget
   stabilization reserve fund up to 4.5% 12% of all general fund appropriations in the second year of the biennium.
              (7)    "Emergency" means a catastrophe, disaster, calamity, or other serious unforeseen and
   unanticipated circumstance that has occurred subsequent to the time that an agency's appropriation was made,
   that was clearly not within the contemplation of the legislature and the governor, and that affects one or more
   functions of a state agency and the agency's expenditure requirements for the performance of the function or
   functions.
              (8)    "Funds subject to appropriation" means those funds required to be paid out of the treasury as
   set forth in 17-8-101.
              (9)    "Necessary" means essential to the public welfare and of a nature that cannot wait until the
   next legislative session for legislative consideration.
              (10)   "New proposals" means requests to provide new nonmandated services, to change program
   services, to eliminate existing services, or to change sources of funding. For purposes of establishing the
   present law base, the distinction between new proposals and the adjustments to the base budget to develop
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68th Legislature                                                                                                     HB 424.1
   the present law base is to be determined by the existence of constitutional or statutory requirements for the
   proposed expenditure. Any proposed increase or decrease that is not based on those requirements is
   considered a new proposal.
              (11)   "Operating reserve" means an amount equal to 8.3% of all general fund appropriations in the
   second year of the biennium.
              (12)   "Present law base" means that level of funding needed under present law to maintain
   operations and services at the level authorized by the previous legislature, including but not limited to:
              (a)    changes resulting from legally mandated workload, caseload, or enrollment increases or
   decreases;
              (b)    changes in funding requirements resulting from constitutional or statutory schedules or
   formulas;
              (c)    inflationary or deflationary adjustments; and
              (d)    elimination of nonrecurring appropriations.
              (13)   "Program" means a principal organizational or budgetary unit within an agency.
              (14)   "Requesting agency" means the agency of state government that has requested a specific
   budget amendment.
              (15)   "University system unit" means the board of regents of higher education; office of the
   commissioner of higher education; university of Montana, with campuses at Missoula, Butte, Dillon, and
   Helena; Montana state university, with campuses at Bozeman, Billings, Havre, and Great Falls; the agricultural
   experiment station, with central offices at Bozeman; the forest and conservation experiment station, with central
   offices at Missoula; the cooperative extension service, with central offices at Bozeman; the bureau of mines and
   geology, with central offices at Butte; the fire services training school at Great Falls; and the community
   colleges supervised and coordinated by the board of regents pursuant to 20-15-103."
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              Section 3. Section 17-7-130, MCA, is amended to read:
              "17-7-130.   Budget stabilization reserve fund -- rules for deposits and transfers -- purpose. (1)
   There is an account in the state special revenue fund established by 17-2-102 known as the budget
   stabilization reserve fund.
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68th Legislature                                                                                                    HB 424.1
              (2)    The purpose of the budget stabilization reserve fund is to mitigate budget reductions when
   there is a revenue shortfall.
              (3)    By August 1 of each year, the department of administration shall certify to the legislative fiscal
   analyst and the budget director the following:
              (a)    the unaudited, unassigned ending fund balance of the general fund for the most recently
   completed fiscal year; and
              (b)    the amount of unaudited general fund revenue and transfers into the general fund received in
   the prior fiscal year recorded when that fiscal year's statewide accounting, budgeting, and human resource
   system records are closed. General fund revenue and transfers into the general fund are those recorded in the
   statewide accounting, budgeting, and human resource system using generally accepted accounting principles
   in accordance with 17-1-102.
              (4)    (a) The state treasurer shall calculate the operating reserve level of general fund balance
   defined in 17-7-102(11). The treasurer shall first apply the excess revenue to reach the operating reserve level
   general fund balance, if necessary.
              (b)    Once the general fund balance is at the reserve level, 75% of the remaining excess revenue is
   transferred to the budget stabilization reserve fund. as follows:
              (i)    to the budget stabilization reserve fund, until the amount in the fund is equal to 12% of all
   general fund appropriations in the second year of the biennium; then
              (ii)   to the account established in 17-7-209, until the amount in the fund in excess of the amount
   needed for appropriations from the capital developments long-range building program account in the capital
   projects fund type is equal to 12% of all general fund appropriations in the second year of the biennium.
              (c)    After the transfers in subsections (4)(b)(i) and (4)(b)(ii) have been made, if the balance of the
   budget stabilization reserve fund exceeds an amount equal to 12% of the general fund appropriations in the
   second year of the biennium and the balance of the account established in 17-7-209 in excess of the amount
   needed fo