Don’t Be Fooled: Montana Can and Must Invest in Child Care and Housing Solutions for Montana Families

Apr 12, 2023

Montana legislators walked into the Capitol on day one of this session, looking at a $2 billion surplus. Due to federal stimulus, in-migration, and inflation, Montana had an unprecedented opportunity to invest in a Montana that works for all of us.

And they had their work cut out for them. Montana communities are facing multiple issues affecting our workforce, including skyrocketing housing costs and homelessness on the rise; a lack of safe, reliable, and affordable child care keeping many Montanans out of the workforce; and low reimbursement rates for health providers preventing our workforce from stabilizing. Several bills are in the works, including HB 648 to invest in child care, and HB 927 to address housing affordability. Montana workers, businesses, and communities have made it clear that these issues require legislative action.

Legislative staff released a status sheet on April 7, showing how the state’s budget and bills moving through the session are balancing. This includes several bills proposing significant reductions in the ending fund balance through one-time rebates and transfers. Factoring in tax cuts already enacted and one-time rebates still in consideration, the ending fund balance is projected to be negative by the end of the next biennium. However, the state remains in structural balance by more than $400 million. This means ongoing projected revenue will fully cover the proposed ongoing investments, including modest investments in child care and health provider rates, into the future.

The real issue is irresponsible one-time tax rebates that will leave the state with a lower ending fund balance. These one-time tax rebates are estimated to cost almost $800 million over the biennium and yet provide no policy solution.

There is an easy fix: adjust the one-time transfers and rebates to ensure an adequate ending fund balance. The legislature should reject HB 816, pumping yet another $200 million into one-time rebates and should adjust one-time transfers in HB 424 to ensure an adequate ending fund balance.

Our current issues with child care, unaffordable housing, and health services have yet to be addressed in this session. Montana workers and families need solutions. Modest investments to support families with child care, address long-standing gaps in the cost of health services for seniors and people with disabilities, and address housing affordability are critical to getting our state and our balance sheet back on track.

Montana Budget & Policy Center

Shaping policy for a stronger Montana.

MBPC is a nonprofit organization focused on providing credible and timely research and analysis on budget, tax, and economic issues that impact low- and moderate-income Montana families.