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Committee hears DNRC loans program bill backing coal-severance bonds for irrigation loans
Summary
House Bill 8 would reauthorize and provide state-backed loans for irrigation and other renewable-resource projects through DNRC, using coal-severance tax–backed bonds and subsidized interest rates.
Representative John Fitzpatrick presented House Bill 8, which would authorize loans under the renewable-resource loan program administered by the Department of Natural Resources and Conservation (DNRC). Fitzpatrick said the program has operated since 1993 and combines prior public-loan programs; the bill authorizes up to $133 million in loans, including roughly $36.6 million in new projects and $84.6 million in reauthorizations of previously approved loans, plus bond reserves.
Autumn Coleman (DNRC) testified that public loans are subsidized via coal-severance tax–secured bonds and are offered at a low interest rate (the bill references a 3% interest rate). Loan repayment is tied to fees on water users and applicants must demonstrate ability to repay under standard repayment terms and bonding capacity. DNRC said public-loan applications are accepted in May of even-numbered years alongside grant applications and that bond proceeds and reserves are used to secure loans.
Proponents including Ben Rigby (Montana Rural Water) and the Montana Infrastructure Coalition said loans are important for regional water systems and rural communities that need low-interest capital for new systems or rehabilitation. DNRC staff and the Governor's Budget Office answered technical questions about fiscal notes and bond-reserve mechanics.
Fitzpatrick closed by urging the committee to move the bill forward; there were no amendments presented in the hearing.
