Tonight on Capitol Talk: The state's utility regulators endorse a bill that appears to weaken the their own regulatory oversight. The cost of Medicaid expansion — and a new revenue estimate — complicate the state budget outlook. The president of the Senate wants to be the top election official. And the mayor of Helena wants to run for governor or Congress, but he's not ready to say if he'll run as a Democrat or Republican.
Sally Mauk: Welcome to Capitol Talk our weekly legislative analysis program. I'm Sally Mauk and I'm joined by Lee Newspapers Capitol Reporter Holly Michels and University of Montana Political Science Professor and Mansfield Center Fellow Rob Saldin.
Mauk: And Rob, the state Public Service Commission this week voted 3 to 1 to support a bill that would allow NorthWestern Energy to buy more of the Colstrip 4 coal-fired plant and pass some of the costs on to ratepayers without PSC review. The PSC's own staff opposes this bill, as do consumer advocates. Why on earth is the PSC supporting a bill that on its face seems to go against its own mandate?
Rob Saldin: Yeah, well I think a lot of people are asking that question right now Sally. Just a little bit of background on this: The PSC is a key player here because it's, of course, the regulatory body tasked with overseeing utilities in the state of Montana. It consists of five elected commissioners. They each represent a portion of the state, and currently all of the commissioners are Republicans. The basic reason the PSC exists is to look out for and protect consumers. And the idea here is that utilities are different in really important ways from other companies; they're monopolies. They have a captive set of customers. That is, we don't really have a viable option of getting our energy from any other provider, and energy is a necessity, right? It's not like an optional luxury item or something we can easily do without. Well, as a result utilities are heavily regulated to ensure that consumers aren't taken advantage of, that rates are affordable, that the supply of energy is reliable and sustainable over the long run.
Well the PSC this week voted 3 to 1 in support of this legislation, saying that NorthWestern energy could take over Colstrip and that it's a good thing for consumers. And basically the argument of the majority is that it ensures a reliable and sustainable energy source — which is debatable as well since many people think coal is on its way out as an energy source, but no one knows the timetable for that.
Mauk: But the bill has been amended to allow some PSC review. But here's how that PSC's own attorney Zach Rogala described the bill at its first hearing.
"This bill is nothing about saving Colstrip. This bill is all about a blank check for NorthWestern to its shareholders."
Mauk: There's nothing ambiguous about that statement Rob, and one of his concerns is that ratepayers would be stuck with the cleanup costs of Colstrip if and when that plant is closed.
Saldin: Well yeah, exactly Sally. I mean there are a couple of things going on. One of the commissioners — the commissioner who voted against PSC supporting this legislation, Roger Koopman — he argued that this amounts to an abdication of authority by the PSC. In other words he's saying that in giving a thumbs-up to this legislation, that would exempt NorthWestern Energy from some of the usual PSC oversight, that the PSC itself is totally undermining the entire point of having such a commission in the first place. So that's one argument.
Then there's this other argument that is a little bit more broad and that is that a lot of people look at this legislation and see it as one: a bailout for Colstrip, which I think certainly some members of the Legislature do approach it from this angle. They care about Colstrip, it's maybe the place that they represent, they want to save it. In addition to that, other people see it as a sweetheart deal for NorthWestern Energy, which gets to acquire the Colstrip plant for one dollar without assuming any of the risk that goes along with that. And instead it leaves Montana energy consumers on the hook for everything.
And for some, I think this really conjures up bitter memories of the 1990s, back when Montana Power Company was controversially deregulated during Governor Racicot's tenure. And that ended up with taxpayers bearing big costs.
And then, as you suggest Sally, on top of that, critics of the current proposal also say, 'look, it leaves us tied to this coal-based energy, potentially for a long time. It discourages a pursuit of potentially more environmentally friendly energy sources, and also much cheaper energy sources.'
And all of this, this week, just got a big stamp of approval from the very commission tasked with looking out for Montana ratepayers.
Mauk: And if this bill does send up on Governor Bullock's desk it puts the governor in an interesting position. Labor unions support this bill. Obviously people in Colstrip support the bill. But the governor would be, it seems to me, in a position of wanting to veto it. What do you think?
Saldin: This is one of those things that's just tricky for Democrats in this state. As you say, labor has come out in support of it. Environmentalists don't like it. Bullock is also looking at running for president. This is not the kind of thing that would go over well with primary voters across the country. So it puts them in a little bit of a bind. I would kind of guess, if pressed, that he would probably veto it. But it's not, I think, something that he would look forward to having come to his office.
Mauk: Well Holly, the Democratic and Republican bills to continue Medicaid expansion were heard in committee this week, but the committee has postponed action on those bills until at least Monday. Why the delay?
Holly Michels: About a week ago we had a really long all-day Saturday session where we heard from dozens and dozens of people about their views on the dueling bills. There was also a rally with about 400 people that filled the Capitol rotunda. And the plan was to have the committee vote on Friday if it would send both or just one of those bills to the House for full debate. They could always vote down both of the bills, but that's pretty unlikely because there's agreement the program should continue. But none of that has happened yet. This whole process has taken a long time because it's such a complex bill. But we also had Representative Buttery not introducing his bill until just a few days before that committee hearing. This bill does need to clear the house by April 1. That's the transmittal deadline it's under, so we would need to see a vote by next, probably Monday or Tuesday, to get it across by that timeline.
Mauk: Some argue that the work requirements in the bill don't take into account Montana's changing economy and unique economy. Kate Clayton is a ranch worker.
"I think that we can agree that jobs and ranching are cornerstones to the Montanan way of life. And it's rare that ranch and farm managers are able to provide employees health care coverage. I personally don't know any ranches that are able to provide these benefits.".
Mauk: For workers like her, Holly, Medicaid expansion is crucial if they want to have health coverage.
Michels: What Kate said is when she's working on her ranch during that season it'd be very easy to meet and exceed the hours required under the Republican bill. But just looking at even during that season it's hard for her to report those hours because ranches that she works on have bad cell phone or Internet service. Issues like that are what caused people in states like Arkansas — which has implemented similar work requirements — to lose coverage. It's not that they're not working or meeting those hours, but they get hung-up doing the reporting.
But then there's this bigger question of what happens during the off-season for workers like her. Montana is moving more toward an economy driven by tourism. A lot of those jobs are seasonal. We've also always had a pretty big ag sector in the state. Construction jobs, there's a lot of work that seasonal, and we're also shifting more toward a gig economy where there's just not regular reliable hours all the time. And we heard from quite a few people in the hearing about concerns if they would lose their coverage under their bill because of the type of work that they do.
Mauk: Meanwhile Holly, the House on a mostly party-line vote has passed a state budget over to the Senate, and here's how Republican Nancy Ballance described it.
"We made the decision not to raise taxes. We are structurally balanced. We left an operating reserve of $214 million, with a small amount remaining to do the work that we have yet to do."
Mauk: And that work yet to do, Holly, is Medicaid expansion for one thing.
Michels: Yep, there are still a lot of bills left in play that if they pass would spend money from the state general fund. There's Medicaid expansion. There's also public pre-school proposals which both parties have shown some interest in. And other education funding pieces. We also this week had our first hearing on the revenue estimate. That's sort of the legislative and governor's staff puts together their assumptions about how much revenue the state will gather, how much we have to spend this session. There's a lot more agreement than we've seen in sessions past about what that projection looks like. We heard from the legislative side that they think we'll actually only be down from the estimate that we started this session with by about $37.5 Million. The governor's office is predicting about a $16 or $60 million drop there. So in the scheme of a $10.3 billion budget when you're looking at all funds, that's a pretty small amount. And the difference between the two estimates is also pretty small given the size of the budget. But something to consider, and Representative Ballance brought this up on the House floor, is that if revenues dip too low we hit a part of state law that triggers reduction in spending. And the difference between that $214 million she's talking about and the point where we hit that trigger is just about $80 million. So, while the differences we're talking about in revenue estimates right now seem pretty small, they could turn out to matter quite a bit as the session goes on.
Mauk: The budget is far from a done deal and won't be a done deal for some time yet.
Senate President Republican Scott Sales, Rob, is already looking beyond the Legislature to his own political future, and he announced this week he'll run for secretary of state.
Saldin: Yeah exactly Sally. Secretary of state in Montana oversees the state's elections. The current occupant of that office is Corey Stapleton. Stapleton has already announced that he's running for governor, so the seat's gonna be open. Sales is a longtime legislator who's from Bozeman. He served in both the House and the Senate. He's held the top leadership position in each chamber, speaker of the House, and now for the second session in a row he is president of the Senate. So he's been around a long time, well known in Helena, well-known in the party. It seems like a natural step.
Mauk: As a legislator he opposed same day voter registration. And he promises to tighten voting qualifications if elected secretary of state.
"I think that we should put more emphasis — and I'm not saying barriers — but that we need to make sure that we do the best of our ability that people are voting that are qualified to vote in the state of Montana. And I don't think it has to be a burdensome process."
Mauk: This implies, Rob, that people maybe are currently voting illegally.
Saldin: It does. And this is something we hear a lot from Republicans. They look at the system and say, 'look even if you can't necessarily show me a whole bunch of cases of documented abuse, I mean just look at some of these loopholes. It's not that big of a stretch to think that maybe some of them are being taken advantage of.' So they do tend to emphasize trying to tamp-out any possibility of election fraud. And of course Democrats tend to emphasize ballot access, and want to make it as easy for as many people to be able to cast a ballot in our elections. And I think we'll see that as an issue in that campaign.
Mauk: Sales isn't the only person this week to state an interest in running for a new office. Helena Mayor Wilmot Collins says he's thinking about running for governor or for Congress. And this raised a few eyebrows since he's only been mayor for about a year.
Saldin: Mayor of Helena. He has a pretty amazing story. He's a Liberian refugee. He's gotten a lot of media attention for that ... nationally. And so even though he's a fresh face without a whole lot of experience, I think a lot of Democrats do look to him as maybe a rising star. And it's also just worth maybe noting that experience seems to not be quite the hot item that it has been in the past. Barack Obama did not have very much experience before he ran for president. Donald Trump had even less. Here in the state Greg Gianforte and Steve Daines did not have political experience before they ran for their offices. So who knows.
Mauk: It's interesting, Holly, that Collins wouldn't say if he's running as a Democrat or Republican. I think he said he's running as an American.
Michels: That was an interesting response to that. Be curious to see what party he declares when and if he does file. I think you're looking at the governor's race on the Democrat side, if that's how Collins chooses to go. It is assumed that Lieutenant Governor Mike Cooney is going to jump into that race pretty soon. So, wondering if Cooney goes, if that would change Collins's approach at all.
Mauk: And maybe he's going to start a third American party.
Saldin: Well it is maybe worth noting that the mayor's office in Helena is nonpartisan. So he ran for that office without party I.D. Although, I mean, I think everyone assumes that he's a Democrat. I mean, I remember he endorsed John Heenan for his run for the house. I mean, it would be shocking I think if he didn't run as a Democrat.
Mauk: Well we'll wait and see if we're going to be shocked.
You've been listening to Capitol Talk our weekly legislative analysis program. I'm Sally Mauk. I've been speaking with Lee Newspapers Capitol Reporter Holly Michels and University of Montana Political Science Professor and Mansfield Center Fellow Rob Saldin.