Bill to revise oversight of student scholarship organizations draws questions on fiscal workload

Senate Bill 253, described by sponsor Sen. Vinton as legislation "generally revising laws related to student scholarship organizations," drew support from scholarship groups and questions from the Department of Revenue and committee members about administrative workload and the fiscal note. Ross Izzard of ACE Scholarships testified in favor, saying ACE is "the largest and currently the only statewide student scholarship organization in Montana" and that the bill should strengthen the Big Sky program.

The Department of Revenue provided informational testimony about certification and supervisory workload. Jake Ford, income and withholding taxes bureau chief, told the committee that "I believe we currently have 25 that are registered with us," referring to student scholarship organizations on file with the department. Ford described tasks the department would carry out under the bill: designing an approval process, implementing a denial-and-appeal process with a 30-day cure period, reviewing whether organizations meet 501(c)(3) status and the requirement to allocate at least 90% of eligible donations to scholarships, and maintaining published information and links on the department website.

Senators pressed for detail on the fiscal assumptions. Sponsor Vinton disputed the department’s requested staffing level and offered a rebuttal to the fiscal note; he said the bill’s functions could be performed primarily by the scholarship organizations and that the department’s request for two permanent staff (one auditor-level FTE and an overseeing manager) appeared excessive. Vinton estimated the department might need only "a quarter of an FTE" to meet its obligations, while the Department of Revenue explained the department’s view that certifying organizations, managing denials and appeals and maintaining public links would create a new workload for which they requested two FTEs.

Committee members asked how many scholarships or donations would be involved and whether the new duties could be absorbed in existing units. Ford said his office’s estimate was based on creating a new education-focused unit and that the requested two positions were intended to manage the anticipated processes. He said the two-person request was Department of Revenue management's judgment about appropriate oversight for application review and final decision-making.

Senator Vinton closed by saying the bill requires the department to add a link and that he had not had time to discuss the fiscal note with the department before the hearing; he said he would work on clarifying the staffing assumptions. No executive action on SB 253 was taken at this hearing; the sponsor indicated an amendment would be prepared to scale the FTE request (later discussed as reducing to a half or quarter FTE in follow-up).