Marijuana tax compromise bill heads to governor and likely veto
Laura Lundquist
(Missoula Current) A strong bipartisan majority of the Montana Legislature has passed a bill using marijuana tax revenue to fund Habitat Montana and county road maintenance, but supporters anticipate a governor's veto.
On Monday at noon, in the Legislature’s Senate chambers, a diverse group of about 20 Montanans stood behind Sen. Mike Lang, R-Malta, for the announcement that his bill, Senate Bill 442, was likely on its way to the governor’s desk.
“The good thing about it is it’s backed by many Montanans: ranchers, farmers, county commissioners, hunters, anglers, hikers, four-wheelers, veterans, home healthcare providers, energy people and many others,” Lang said. “We have to respect the ideas of every Montanan yet we have to work together and keep ourselves in the middle of the road or we will not have success. This thing started out as a kind of controversial bill but it has some inspiring language, some inspiring passages with it that informs where we want to go.”
When Lang first introduced the bill, SB 442 focused only on providing money for county road maintenance. With all the tourist and recreation traffic spawned by the pandemic, many counties have struggled to repair roads rutted by record traffic.
But many people came forward to oppose Lang’s bill, because Montana voters passed an initiative in 2020 that promised about a third of the marijuana tax revenue to Habitat Montana, a Fish, Wildlife & Parks program that buys fee-title land or conservation easements to preserve Montana’s open space for wildlife. Then, the 2021 Legislature had mandated that Habitat Montana, FWP’s non-game wildlife program and state trails would receive some of the tax revenue, although it was less than promised by the ballot initiative.
In mid-March, after the second committee hearing on SB 442, Lang worked with sportsmen, county representatives, landowners and others to develop an amendment that gives 20% of the tax revenue to county roads and 20% to a new Habitat Legacy Account, which funds both Habitat Montana and the Wildlife Habitat Improvement Program.
The amendment also devoted 4% each to the nongame wildlife program, state parks, and trails; 5% to funding for property tax coverage for disabled veterans and their spouses; and 0.2% for a law enforcement crisis intervention team. In addition, the governor's HEART program received 11%, an increase over the $6 million allotted in 2021. Based on the tax currently being collected, some money will likely be left over for the general fund.
On Monday, Denny Iverson, member of the Blackfoot Challenge and Five Valleys Land Trust president, praised the two weeks of collaborative work that went into modifying SB 442. As a farmer, he stands to benefit from better roads, improved habitat and conservation easements.
“In the Blackfoot, we’ve been doing collaboration for 30 years, and this is a shining example of that kind of collaboration. You gotta give and take,” Iverson said. “Conservation easements are a very important piece of farmers’ and ranchers’ lives. We’ve done three on our place. It’s allowed our family to come back, our kids to come back, and my being able to buy a neighboring place and allowing us to get a little bigger so our kids can hopefully make better of it than I did.”
After the bill was amended, a diverse group of supporters rallied behind it, and it flew through the Senate with only one “No” vote. It was equally successful in the House, with more than 80% in favor. But the House added another amendment, so SB 244 had to return to the Senate where 48 of 50 senators voted in favor on Monday morning.
Roman Zylawy, Montana Association of Counties president, emphasized the need for more money to help counties maintain their roads. He credited a dozen legislators who helped push SB 442 through the Legislature but said all were important.
“This would not have been possible without all 48 senators and 82 representatives who saw the wisdom of long-term funding for county roads, which in turn benefits Montanans,” Zylawy said.
SB 442 is headed for the governor’s desk, but supporters are concerned that Governor Greg Gianforte will veto it. Prior to the Legislative session, the governor’s budget proposal removed all marijuana tax revenue from Habitat Montana, signaling his intent. He increased the allocation for Habitat Montana to $12 million, but all of the state funding came from sportsmen’s dollars.
Legislative sources say Ryan Osmundson, Gianforte’s budget director, has been lobbying legislators to vote against SB 442, and Osmundson was seen talking to legislators after Monday’s event.
A veto would be a disappointment to many. But supporters point out that legislators could override a veto if all or most of them didn’t reverse their vote once the bill returns to the Legislature.
At least three other bills have sought to redirect the marijuana tax revenue toward or away from various programs. HB 669, sponsored by Rep. Bill Mercer, R-Billings, allocated $6 million to Gianforte’s HEART addiction fund and shunted the remainder of the marijuana tax revenue into the state general fund. HB 669 made it through the House on a party-line vote but was tabled in a Senate committee at the end of April.
Most recently, SB 538 was radically changed from merely licensing marijuana dispensaries to also allocating the marijuana tax revenue. While it still allocated money to the Habitat Legacy Program, it eliminated the percentage of marijuana tax revenue that SB 442 put toward the non-game program, state parks, trails and county road maintenance.
SB 538 had less legislative support than SB 442, having been tabled, resurrected and amended. The newest version had struggled since last week to make it through a vote on the House floor. Late Monday, Rep. Hopkins asked that the language in SB 538 related to marijuana revenue be eliminated to return the bill to its original form. The amendment passed, but then SB 538 failed to pass second reading by a vote of 38-62.
SB 442 now has no active competing bills, and only four days remain in the Legislative session. But discussion on the House floor hinted at the chance that similar language could still pop up in other bills before sine die.
Contact reporter Laura Lundquist at lundquist@missoulacurrent.com.