Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Coal Trust Interest Allocation topic
No spam. Unsubscribe anytime.
Committee hears bill to redirect coal-trust interest to highway account and trooper pay
Summary
House Bill 615 would direct roughly $20 million a year in coal severance trust interest — $2 million to the Department of Justice for trooper retention and the remainder to the Highway State Special Revenue Account (HESRA) — and extend several smaller coal-interest allocations through mid-2029. Committee members asked for fiscal scenarios and raised concerns about permanently constraining future budgeting.
At a House Taxation Committee hearing, Rep. Jerry Schillinger introduced House Bill 615, saying the proposal would direct about $20,000,000 in annual interest from the coal severance tax permanent fund away from the general fund and into transportation and public-safety uses. "So house bill 6 15 is a simple $20,000,000 bill," Schillinger told the committee, and "2,000,000 will go to the Department of Justice to help retain troopers."
The legislation would direct the remainder of that interest to the Highway State Special Revenue Account (HESRA) at the Department of Transportation, which Schillinger and analysts said is used for federal match, contractor payments and nearly all highway maintenance. Schillinger and fiscal staff distributed graphs showing projected HESRA balances with and without added coal-interest distributions.
The bill also extends a set of existing coal-trust interest appropriations that were scheduled to sunset in 2027 through June 30, 2029. Those line items include small allocations for agriculture and commerce programs (for example, identified amounts for a small business development center, growth-through-agriculture programs, Montana Manufacturing Extension Center support, and export-trade enhancement), which Schillinger said would be continued temporarily under the bill and, in part, would fold into the transportation allocation if not renewed after 2029.
Legislative Fiscal Division analysts and Department of Transportation officials described two projection scenarios: a baseline federal funding-growth trajectory (about 2% per year) and a higher-growth scenario (for example, 4%) that changes the required state match. Alice Hecht of the Legislative Fiscal Division told members the analysts used the roughly $19M–$20M figure as an estimating amount for the stream of interest the bill would redirect and said that earnings vary year to year.
Committee members pressed the sponsor and staff for alternatives and clarifications. Representative Elvrom asked whether dedicating the full remainder would "tie our hands going forward," saying he was "not clear on how much that is and how much that ties our hands going forward." Sam Schaeffer of the Legislative Fiscal Division cautioned that dedicating the full amount each year could make the HESRA balance grow substantially over time under some assumptions; he said the committee could look at scaled options (for example, $5M, $10M, $15M or $20M) to compare outcomes.
Committee members also discussed whether filling the HESRA gap instead with a gas-tax increase would be feasible. Larry Flynn, deputy director at the Department of Transportation, estimated that using only a gas-tax increase instead of the coal-interest money would require "about a 3 to 3 and a half cent per gallon" rise in the gas tax.
Several members asked why $2M for the Department of Justice was included directly in HB 615 rather than in the general-appropriations bill; the sponsor said routing the funds directly from the coal-interest stream is one way to ensure the support for trooper retention. Members noted that most of the smaller program allocations the bill extends are scheduled to sunset in 2027 and that without legislative action they would revert to the general fund or be folded into transportation distributions after the sunsets expire.
No public proponents or opponents testified in person or online during the hearing; informational witnesses who answered questions included Larry Flynn (Deputy Director, Department of Transportation), Mandy Rambo (Deputy/Acting Director, Department of Commerce), Alice Hecht (Legislative Fiscal Division), Mackenzie Espeland (Division Administrator, Department of Commerce), George Harris (Executive Director, Montana Coal Council) and Sam Schaeffer (Legislative Fiscal Division).
Rep. Schillinger closed by urging passage and noting uncertainties in federal funding trends. The chair closed the hearing on HB 615 and announced the committee will take executive action on five bills the next day at 9:00 a.m.; the committee also plans additional hearings this week. The bill will return to the committee for amendment and executive-action consideration, where members asked staff to provide scaled fiscal scenarios and options for preserving specific small programs while directing other interest revenue to HESRA.
