HELENA — The House Appropriations Committee on Tuesday opened a hearing on House Bill 3, the session’s supplemental appropriations bill, hearing agency summaries and questions from legislators but taking no executive action.

House Bill 3 would provide one-time and some continuing appropriations to cover fiscal-year 2025 shortfalls and emergent needs. “House Bill 3 is the supplemental bill,” sponsor Representative Lou Jones, House District 18, told the committee during his opening remarks.

Why it matters: The bill would fund immediate gaps in agency budgets that officials said cannot wait until the next biennium. Agency witnesses described staffing-driven overruns at the Montana State Hospital and Montana Veterans Homes, higher-than-expected outside-counsel costs for indigent defense, infrastructure and safety work at correctional facilities, and other program shortfalls that administrators said would jeopardize operations without supplemental funding.

What agencies asked for
- Department of Public Health and Human Services (DPHHS): Jason Harlow of the Governor’s Budget Office said the request includes $22,200,000 of general fund for the health facilities division to address shortfalls driven largely by contracted clinical staffing at the Montana State Hospital and reduced revenue for Montana Veterans Homes. Kim Aiken, chief operating officer for DPHHS, told the committee that $3,300,000 of that total is tied to reduced cigarette-tax revenue for the Montana Veterans Home and the remainder is associated primarily with contract staff costs at the state hospital. Aiken and other witnesses said the department has relied on travel nurses and contract clinical staff since the public-health emergency, increasing costs.

- Department of Corrections (DOC): The administration requested $11,550,000 of general fund. Natalie Smithham, chief financial officer for DOC, said about $4,800,000 addresses county jail-hold costs in excess of prior appropriations and roughly $7.25 million (later amended in testimony to be closer to $8.9 million) would pay to replace failing secure doors in high-security units and related A&E costs. Russ Katheren of the Architecture and Engineering Division said door replacements are a complex, hardware-heavy project that will require cutting existing frames from concrete, ordering 244 doors, and an estimated three months to order and seven months to complete installation for all doors. Smithham said the department intends to mitigate interim risk with temporary staffing and repairs but called the door failures a significant safety risk.

- Office of State Public Defender (OPD): Brett Schandelson, director of the Office of State Public Defender, described a $12,500,000 general fund request for the conflict-division to cover contract-attorney overages and constitutionally required outside counsel in fiscal years 2024–25. Schandelson said vacancy-savings forecasts from prior sessions did not materialize and that contractor use rose after COVID-era churn; the agency has included permanent funding in its executive budget proposal to address the recurring need.

- Department of Justice / Montana Highway Patrol: The budget office requested $4,100,000 of general fund to cover required supplemental retirement contributions for the Montana Highway Patrol after a statutory appropriation was struck by prior legislation (House Bill 569); DOJ staff explained the change removed a pass-through general-fund payment and left the Highway Patrol to absorb the additional employer-share costs without that statutory mechanism.

- Department of Revenue: Paula Gilbert, administrator for the Property Assessment Division, said the administration requests $1,700,000 of general fund in anticipation of a pending homestead-exemption bill. Gilbert detailed roughly $250,000 for mailing and advertising and the remainder to hire staff to process an estimated 230,000 residential and 54,300 long-term rental applications.

- Office of the State Auditor: Amber Thorvilleson, CFO for the State Auditor’s Office, said the Montana Reinsurance Program underestimated claims and needs additional state-special spending authority of $3,870,205; the agency has cash but needs appropriation authority to expend it.

- Montana Fish, Wildlife & Parks (FWP): Lena Havron, chief financial officer for FWP, requested $650,000 (testimony later indicated the actual reimbursement expectation was closer to $900,000–$950,000) of state special to reimburse DNRC for fire-suppression costs on a wildlife-management area where a prescribed burn escaped control; FWP also seeks $500,000 of state special for legal settlements and unanticipated legal costs.

- Other items: The Office of Public Instruction requested $26,655 to cover higher-than-appropriated tuition/formula costs. Harlow also noted an anticipated DOJ amendment for $223,000 related to implementation costs for House Bill 423 (wrongful-conviction compensation) and DOC requested an additional $1,500,000 amendment on the door project plus $600,000 for emergency building repairs.

Committee questions and follow-up requests
Committee members pressed for detail on line-item breakdowns and the basis for each request. Representative Falk asked whether the Department of Revenue’s $1.7 million was for personal services or operating expenses; Gilbert answered with the mailing and hiring estimates cited above and agreed to provide further written detail to members. The committee asked DOC for line-item cost estimates and a mitigation plan while doors are replaced; DOC said some mitigation (patch repairs, additional staff) would be handled from existing maintenance and staffing budgets but asked the committee to consider expedited funding so procurement can start immediately.

On public defense funding, Schandelson explained that last session’s supplemental needs were driven by vacancy-savings forecasts that did not materialize and by a continuing reliance on contract attorneys; he said the executive budget includes a request to make part of the funding ongoing.

The committee collected several data requests to be delivered to staff by noon the following day, including: lists of fiscal transfers and budget-change documents used in FY24, a line-item breakout for DOC’s door project and proposed amendments, a month-by-month calculation supporting the DOC jail-hold supplemental, and a state-only breakdown of DOJ costs incurred in implementing House Bill 423.

No executive action
Committee Chair Lou Jones closed the hearing and said the committee will likely take executive action on the supplemental mid‑next week; no motions or votes were recorded at the hearing.

Ending
Committee members said they will review materials submitted by agencies and may propose amendments before executive action. Witnesses who agreed to provide follow-up were asked to coordinate with committee staff and deliver requested details on the timelines the committee specified.