Invest in Montana, not Wall Street

The 1975 Montana Legislature approved a constitutional referendum that let Montana voters decide whether or not to create a permanent coal trust and fund it with 50 percent of the severance taxes paid by coal companies.

Forty years and nearly $1 billion later, the 2015 Legislature is considering whether to let voters decide if it is time to spend most of the coal tax revenue on needed infrastructure and grow the coal trust at a slower rate.

Opponents to Senate Bill 353 are adamant that voters should not be given the opportunity to revisit the manner in which state government handles the $50 million to $60 million collected in coal taxes every year.

If voters were smart enough in 1975 to sort through the facts in establishing a coal trust, are they not smart enough in 2015 to determine if $1 billion in the permanent coal trust is a time to reassess where the money goes?

SB 353 and its companion bill, Senate Bill 354, would establish a Build Montana program that would fund an estimated $27 million a year in vital local government infrastructure projects throughout the state.

This would be new money, without raising any new taxes, for local roads, bridges, water and sewer projects. The coal trust, which now receives 50 percent of coal tax receipts, would continue to grow, but with 5 percent of total coal tax receipts added to the “corpus” of the trust.

The nearly $1 billion held in the corpus of the trust is invested in low-yield corporate and government bonds. Translation: The State of Montana is loaning our coal trust money to finance the federal deficit and to Fortune 500 corporations so they can create wealth for stockholders.

Are opponents to SB 353 afraid voters would decide to invest future coal taxes in Montana communities rather than in foreign companies?

It is widely known that Montana, like most states, is not keeping up with basic infrastructure needs. The American Society of Civil Engineers recently released a “report card” on Montana’s infrastructure, giving an overall grade of a C minus. Similarly, TRIP (The Road Information Program), a Washington, D.C.-based transportation research group, released a report in January showing 7 percent of Montana’s bridges are structurally deficient, and 10 percent are functionally obsolete. Twenty nine percent of Montana’s highways are in “poor” condition, with another 37 percent rated only in “fair” condition, meaning they are headed towards “poor” without significant upgrades.

Redirecting coal tax revenue to a Build Montana program would make a small but worthwhile investment in our aging infrastructure — especially at the local level where needs are most acute. If passed by voters, SB 353 does not “cap” the coal trust — it would continue to grow as long as coal is mined in Montana. Nor would the bill “bust the trust,” as alleged by some critics. The corpus of $1 billion is untouched and continues to fund important programs, exactly as it does today.

Let’s get beyond the 40-year-old rhetoric and allow voters to decide if they would rather invest in Wall Street or invest in Montana.

Sen. Rick Ripley, R–Wolf Creek, is the sponsor of Senate Bills 353 and 354.