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State Library reports coal severance tax revenues down; reserve likely to be drawn down by FY25
Summary
At a Jan. hearing of the Joint Appropriations Subcommittee on Education, State Library staff told lawmakers that coal severance tax revenues have fallen and that an excess reserve used for the hotspot program will likely be depleted by the end of fiscal 2025, with projected FY25 revenues about 6% below FY24 levels.
State Librarian Jenny Stapp and Central Services Manager Melissa Bridal told the Joint Appropriations Subcommittee on Education that coal severance tax fund revenues supporting the Montana State Library have declined and that the library expects to largely use its excess reserve by the end of FY25.
Bridal summarized the library's handout on the fund and said the library receives about 93% of coal severance tax revenues dedicated to their programs. She told the committee, “by the end of this fiscal year, FY '25, we will have depleted the… excess in reserve that we typically see.”
The library cited Legislative Fiscal Division (LFD) figures showing a projected decrease in coal severance tax receipts for FY25 of roughly 6% compared with FY24. Committee discussion referenced a FY24 revenue base of about $664,000; Bridal said the FY25 total revenue projection is roughly 6% less than that figure. Committee members and staff also discussed the library's appropriation and expected ending fund balance: the ending fund balance from FY24 was reported as $480,000, the library's appropriation for the fund is $900,000, and staff estimated FY25 revenue of about $600,000 would leave an ending fund balance in the range of roughly $0 to $50,000 depending on final receipts and expenditures.
The library noted year-to-year volatility in severance tax collections and said it has used higher-than-usual receipts in recent years to support a “hot spot” program. Bridal told the committee that recent higher receipts had been consumed and that the reduced receipts will shrink the reserve. Members asked for clarification on the calculations and Bridal offered to provide exact numbers before the committee's upcoming work session.
No formal committee action or vote occurred during the discussion; members said they would follow up during the scheduled work session to reconcile the precise figures and any budget implications.
Ending: The committee signaled it would revisit the fund figures at its work session in the weeks ahead. Bridal and other State Library staff said they would supply exact revenue and balance calculations to the committee before that session.
