Politics

Federal spending cuts could cut MT budget by $100M

Posted: Jan 11, 2013 7:08 PM by Marnee Banks - MTN News

HELENA - A series of automatic budget cuts will take effect at the federal level in two months, and Montana lawmakers are already discussing the impact this will have on the state's budget.

Congress describes it as "sequestration," but what that means is automatic spending cuts. Stats show that $4 out of every $10 that is spent in state government comes from Washington D.C.

If Congress doesn't act this will happen sometime during March, smack dab in the middle of Montana's Legislative session.

State Sen. Ed Walker (R-Billings) sits as the Vice Chair of the Senate Finance committee and says sequestration is a reason to draft a more conservative budget.

"We do know there are going to be budget cuts. We just don't know where they are going to come, and when they are going to happen," Walker says.

Montana lawmakers are wrestling with a two year, $10 billion budget.

The Legislative Fiscal Division .reports Montana could lose upwards of $100 million in federal funding this budget cycle, if and when sequestration takes place.

U.S. Sen. Max Baucus (D-MT) agrees that Congress needs to cut spending.

"We are going to have to work hard to figure out how we appropriately reduce the debt. And I am going to make sure that Montana is protected," Baucus said in an interview. "That's my job."

The LFD reports programs like Medicaid and Pell grants are exempt from cuts. But sequestration could impact areas including fish and wildlife, public health and education.

State Sen. Jon Sesso (D-Butte) also serves on the Senate Finance committee and says any cuts to education are worrisome.

"We rely on federal funds and a compliment to our state and local fund for good solid education," Sesso says. "It concerns me deeply."

Sesso says Montana has money in the bank to respond to these cuts without hurting important programs.