“I get the picture. Shut the emails down.”

Date: March 26, 2017

Huge response from NFIB members defeats legislative proposal allowing cities and counties to levy their own sales tax

NFIB/Montana State Director Riley Johnson reports on the small-business agenda for the legislative week ending March 24.

Earlier in the week, NFIB/Montana sent out an “Action Alert” on two bills pending before the Legislature. Both, House Bill 577 and Senate Bill 331, would allow cities and counties to levy up to a 4 percent sales tax on luxury items sold within their jurisdiction.

The alert went out to thousands of NFIB/Montana members asking them to send emails opposing both bills to their representatives and senators. On past statewide ballots, NFIB/Montana members have resoundingly voted down any support of local option sales taxes—even if they also provided some local property tax relief.

The response by NFIB/Montana members was large. On March 24, HB 577 was tabled in the House Tax Committee.

As one representative said to NFIB/Montana, “I get the picture. Shut the emails down.”

Senate Bill 331 still has some life left and will have executive action by the Senate Tax Committee March 28.

Property Tax

House Bill 579 calls for a referendum that would allow counties to levy up to 40 mills on property within the jurisdiction for the purpose of infrastructure, like roads, bridges, waste and drinking water projects, and the maintenance of public structures.

NFIB/Montana opposed this bill, believing it was just another rendition of the local option tax. Hard work in the halls by NFIB/Montana won out as the bill was tabled in the House Tax Committee March 24.

Money Bills

March 31 is the deadline for bills with financial consequences — money bills — to clear one house and moved into the other house. This is known as transmittal deadline. All policy bills, or bills that did not have financial consequences, had a transmittal deadline of March 1.

This means that the money bills this past week and into next week are moving quickly out of drafting and into the coffers of both houses and committees. Some bills offer little to no time for deep consideration by legislators and interested parties to read and digest their contents.

State Sales Tax

One such bill was House Bill 620 by Rep. Kerry White (R) of Bozeman. At 414 pages, this measure is believed to be the largest bill ever be introduced in the Montana Legislature. It is a statewide sales tax bill.

Introduced March 21, it had a hearing March 23, and was tabled March 24.

Workers’ Compensation

Two other measures that received a quick shuffle were Senate Bill 369 and Senate Bill 371.

SB 369 called for a study commission during the 2017-2018 biennium to look at converting the Montana State Fund into a private mutual insurance company. It currently operates as a quasi-state agency that covers more than 60 percent of the state’s workforce with workers’ compensation insurance.

SB 371 called for dissolving the State Fund and turning the whole business of workers’ compensation insurance over to private companies. NFIB/Montana opposed SB 371 and supported SB 369.

Both bills were introduced March 23, had a hearing in the Senate Tax Committee March 24 and tabled the same day.

State-Run Retirement Plan

Senate Bill 346 by Sen. Terry Gauthier (R) of Helena would create within the Montana Department of Commerce a small-business retirement program much like the current college tuition 529 fund program in Montana. Participation by employers and employees would be optional. NFIB/Montana opposed SB 346 for two reasons:

  • first, it could make the employer liable under federal law for any fiduciary problems that might arise over the handling of the investments
  • second, it would allow only the state to manage the program and not open it to private financial companies to compete, keeping fees and costs down.

It passed out of committee on a 6-4 vote, and is headed to the Senate Finance Committee next week. The passage of this bill is in doubt as it carries a fiscal note of some $650,000 to set up and run the program. In today’s tight budget, bills costing money for non-essential things are not faring well in the finance committees.

Tax Deduction

Senate Bill 347 would allow a worker who files a tax home election to deduct from individual income tax unreimbursed travel expenses when his or her work is of indefinite and unpredictable time.

SB 347 passed out of the Senate Tax Committee on a 7-5 vote March 24 and is headed to a hearing before the Senate Finance Committee next week.

Infrastructure’s Wild Ride

Next week will be wild inside the Capitol. With the deadline for any bills coming up on Friday, the featured infrastructure bills from the Republican majority in both houses will emerge and put on fast track for passage into one house or the other.

Right now, Gov. Steve Bullock’s infrastructure ideas and those of the GOP are not even close on how to proceed with money and projects. The biggest stalling point is over funding with bonding or funding with cash. This is the same issue that prevented the last two sessions of the Montana Legislature from passing any infrastructure bills.

Get Involved

Getting involved in the 2017 Legislature is easy. The best way to have your voice heard quickly is to phone 406-444-4800. Operators are on hand in the Capitol Building to take messages for up to five legislators on each call, and delivery is within a half an hour.

More information on:

  • locating legislators
  • getting an e-mail address
  • viewing committee meetings and floor sessions on television or over the internet
  • review all hearings
  • reading of the actual bills …

… can go to www.leg.mt.gov and access everything electronically.

Previous Legislative Reports

March 17 Report—Local Property Tax Levy Coming up for Hearing

March 10 Report—NFIB to Fight 4 Percent Local Options Tax Proposal

March 3 Report—Montana Legislators Getting Down to Dollars and Cents

February 24 Report—Income Tax Proposals Stall; Gas Tax Increase Revving

February 17 Report—Slowest Session in 16 Years Has Not Slowed NFIB

February 10 Report—NFIB Helps Defeat Costly Workers’ Compensation Proposal

February 3 Report—Skirmish Over Funding Montana Legislature

January 27 Report—Montana Legislature Ponders Tax Credits for Startups

January 20 Report—NFIB Helps Defeat Montana Minimum-Wage Bill

January 13 Report—NFIB Readies Opposition to Montana Minimum-Wage Bill

January 6 Report—Montana Legislature Opens Biennial Session

[Tile photo of Rep. Kerry White courtesy of The Montana Legislature website]

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The biggest stalling point is over funding with bonding or funding with cash. This is the same issue that prevented the last two sessions of the Montana Legislature from passing any infrastructure bills.

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