Legislature wraps after months of work on taxes, health policy, education funding

The 69th Montana Legislature ended Wednesday after authorizing residential property tax relief and finalizing spending measures including a $16.6 billion budget bill to fund the state’s operations for the next two years.

The House wrapped up its business with little fanfare at 12:59 p.m. on a 96-4 vote to indefinitely adjourn, first giving final approval to tax bills that favored homeowners and drew protests just a day earlier from refineries, the Montana Chamber of Commerce and the state’s public utilities.

The Senate ended the session as it started, with members of the Republican leadership team chastising the chamber’s largest voting bloc — a group of nine Republicans and the 18-member Democratic minority — who voted together on an array of issues including residential property tax relief and Medicaid expansion opposed by Republican hardliners but supported by two-term Republican Gov. Greg Gianforte.

The Republican caucus in the Senate split on the first day of the session over committee assignments moderates considered punitive. The fracture widened weeks later as leadership launched an ethics investigation into former President Jason Ellsworth, a Hamilton Republican who awarded $170,100 in government work to a longtime associate. A legislative audit found Ellsworth had abused his government position and the Senate chamber ultimately voted to censure and ban Ellsworth from the floor after the chamber’s ethics committee held hearings into his conduct. The issue took up much of the chamber’s time and energy for the first two months of the session.

Ending the session took two rounds of voting in the Senate, the first attempt blocked on an 8-42 vote as the “D+9” group attempted unsuccessfully to resurrect a bill that attempted to fund bridge repairs and support crime victims with taxes on out-of-state luxury vehicles registered in Montana to avoid sales taxes in other states. 

The second vote passed overwhelmingly, but not before members of Senate Republican leadership vented about ending up on the losing side of property tax and budget negotiations led by moderate Republicans that joined with Democrats. 

“Five days early, we’re going to quit because we’re done? I don’t even think we’ve shown up,” said Sen. Daniel Zolnikov, a Republican whip from Billings. “I’m a hard no because again, massive failure. Whatever this was, if this is how people legislate, we have a problem. This is how D.C. does it. We vote yes because it’s easy, we get talking points out. And now we just gave the second floor the ability to do our job.”

The governor, who has an office on the second floor of the Capitol, has indicated for weeks that, as a matter or process, some legislative spending proposals will be cut to balance the budget.

“As Gov. Gianforte did in 2021 and 2023, he’ll carefully review the budget bills and other bills the Legislature sent him to root out wasteful spending, and he will exercise his constitutional authority to veto or line-item veto pork,” said Sean Southard, spokesperson for Gianforte, in a post-session statement.

Senate Minority Leader Pat Flowers, D-Belgrade, told reporters after the session adjourned that the budget as passed by lawmakers was a good product. 

“We absolutely presented a balanced budget to the governor,” Flowers said.

Zolnikov acknowledged on the Senate floor that Senate Republican leadership “didn’t get a lot through, actually very little, because we weren’t in the conversation.”

In a post-session press conference, Senate Tax Committee Chair Greg Hertz, R-Polson, who witnessed several of the tax bills he opposed in committee later brought back to life to the Senate floor, proclaimed Montana’s property tax system “the most complicated tax system of the United States.”

Senate President Matt Regier, R-Kalispell, put in the win column the income tax package in House Bill 337, a $278-million-a-year income tax cut passed with unified Republican support and signed by Gianforte earlier this week.

“Our House Bill 337, which cuts everybody’s income tax … is the biggest income tax reduction in Montana’s history,” Regier said. The president also cited roughly a dozen bills he considered wins for most Senate Republicans.

Senate Republicans spent eight months leading up to the session crafting bills intended to limit the powers of Montana courts and make judicial elections partisan. Of the 27 bills created, only six passed muster with the Legislature. Notably, bills allowing party labels on ballots for judicial races failed.

Senate Majority Leader Tom McGillvray, R-Billings, told reporters that the work done this session would be the foundation for sessions to come. He touted a new review system for judges as a source for voters wanting to know more about judicial candidates.

House Republican leaders highlighted their ability to get bipartisan support for legislation like property tax relief, which eluded the lawmakers in the 2023 session. Included in that equation were more than half the lawmakers in the 100-member House, more than half the lawmakers of the 50-member Senate, and the governor. 

“I think what we managed to do was find those areas where we could find agreement to get 51, 26 and 1, and that’s ultimately what this is about,” said House Majority Leader Steve Fitzpatrick, R-Great Falls.

“It was difficult. I think the product we finally got is a reflection of the reality that compromise around here requires grabbing different parts of different bills and trying to meld them into a final product,” Fitzpatrick said.

House Minority Leader Katie Sullivan, D-Missoula, said Democrats were more effective at advancing their priorities because Montana elected more members of the party to the Legislature in 2024, the first general election held with newly drawn legislative districts adopted following the 2020 census. 

“There are more of us here than there were last session. Montana sent 12 more Democrats to the Legislature and this has been a night and day difference,” Sullivan said. 

Democrats identified health care policy as one of their proudest accomplishments, highlighting a renewed Medicaid expansion program along with House Bill 398 and House Bill 399, a pair of bills that limit insurance companies’ authority over policyholders’ access to medication prior to authorization. Democrats also celebrated investments in education and solar energy.

Lawmakers passed the STARS Act, which was included in Gianforte’s budget and puts $100 million toward increasing starting teacher pay. It saw large bipartisan support in both chambers.

The minority leaders also bashed Republicans for the amount of time the House and Senate spent debating bills limiting the rights of LGBTQ+ Montanans, as well as the GOP-backed income tax cut. Democrats claimed that none were a major priority for their constituents.

“This session, Montana Democrats stood firm in defending our fundamental freedoms under the Montana Constitution and our Montana way of life,” Sullivan said. 

Flowers said his party was “able to have significant influence on both the day-to-day bills that came through and hopefully on the budget” through a “relationship that we’ve built across the aisle with Republicans.”

But Democrats weren’t able to sway Republicans within their coalition about opposing LGBTQ+ issues, where Republicans were able to pass legislation establishing strict sex segregation of multi-user bathrooms now being challenged in court.

“LGBTQ issues are not priorities for them. We don’t share those same values,” Flowers said. “And so in some ways it was not a surprise that they would not work with us.”

A bipartisan coalition of lawmakers passed a bill to continue Montana’s Medicaid expansion program in mid-March, capping debate on a significant policy issue relatively early in the session. Gianforte signed the bill into law the same month, though without a public statement or bill signing ceremony.

The legislation, House Bill 245, was sponsored by Rep. Ed Buttrey, R-Great Falls, who brought prior Medicaid expansion bills in 2015 and 2019. It was supported by the Montana Chamber of Commerce, the Montana Hospital Association, the Montana Medical Association, other industry associations, tribal governments and advocates for health care access. Opponents included Republican lawmakers who consistently forecasted state budget woes if federal funding for the program dwindles. Others said the program was a form of socialized medicine that creates dependency on government support.

Some Republican opponents recognized that their coalition did not have the votes to stop the bill, which lifts the 2025 sunset on Medicaid expansion, in the House or the Senate chamber. Some hoped that sending it to the governor’s desk earlier in the session would give Democrats and moderate Republican supporters less leverage during later policy debates on property taxes and state budget bills. But the passage of HB 245 did not appear to weaken the session’s bipartisan stronghold.

As lawmakers worked in Montana to set the state budget, they kept an eye on the federal government, which has discussed budget reductions that could have a large impact here. Democrats said they considered federal cuts to programs like Medicaid as a potential cause for a special session.

Senator Jonathan Windy Boy, D-Box Elder, said he expected the Legislature to be back for a special session by the end of the year if federal government cuts affected state programs, or the economy listed into a recession during an escalating trade war.