Gianforte targets education, taxes and energy policy in State of the State address

Montana Gov. Greg Gianforte rolled out an agenda of tax cuts and conservative social reforms Monday evening in his State of the State address.

The recently reelected Republican governor called for hundreds of millions in income tax cuts, along with a reduction in state property taxes on primary residences. He urged restrictions on child access to social media, including a cellphone ban in public schools.

Gianforte also used the speech to double down on criticisms of the Montana judiciary and tout efforts that seek to enforce strict sex and gender binaries in many aspects of public life — two salient political issues for the Montana GOP. 

The address came at the start of the 69th legislative session, and Gianforte needs the support of majority-Republican lawmakers to pass his priorities. Though the evening began with members of “The Nine” — a bipartisan group that led a week-long shutdown of Senate committee work — escorting Gianforte onto the House floor.

The escorts were selected by Senate President Matt Regier, R-Kalispell, who lost control of the Senate’s first week to nine lawmakers who balked at being assigned to a committee of questionable purpose. One of the nine, former Senate President Jason Ellsworth, R-Hamilton, quipped that he was selected “I assume, out of respect.”

Regier told the press last week that Gianforte hadn’t played a role in the committee dustup, which shut down bill progress as Republican leaders attempted to work through reassignments. 

The governor led with tax cuts but pivoted quickly to his proposed budget, which combines tax cuts with investments in public safety, teacher pay and housing infrastructure.

Gianforte discussed several of his spending pitches during the hour-long address, including a $100 million ask to provide low-interest loans to help pay for sewer lines and other infrastructure. Gianforte said the money would support new urban housing, expanding an effort he championed during the 2023 Legislature.

The income tax cut Gianforte proposed would extend his prior income tax reductions by lowering the state’s top-bracket rate from 5.9% to 4.9% and modestly expand a tax credit benefiting lower-income working families. According to the Legislative Fiscal Division, the top-bracket rate cut would reduce state tax collections by about $350 million a year and the tax credit for lower-wage earners would reduce their taxes by about $20 million a year.

The governor also asked lawmakers to fast-track his flagship “homestead” property tax proposal, which would increase taxes on second homes in order to lower tax bills on primary homes owned or rented by Montanans. Passing that proposal by mid-February, Gianforte said, would give state tax officials the ability to implement it this year instead of next.

Gianforte said the homestead proposal would reduce homeowner taxes by about 15%. MTFP estimated previously that the tax bill for the state’s median residential property rose by 21% between 2022 and 2023. 

​​“I don’t believe, for example, that a Californian who drops into Montana to ski once in a while near their Montana mansion should get a property tax cut. It’s not fair. It’s not fair to Montanans who own their homes and live here and who invest their lives in their communities,” Gianforte said.

While the state is again heading into a legislative session with a sizable surplus, Gianforte didn’t call Monday for tax rebates along the lines of the income and property tax rebates he and Republican legislators authorized in 2023.

The governor also avoided several significant policy issues during the wide-ranging speech, including abortion, the reauthorization of Medicaid expansion and child care — none of which received specific mention. The governor also did not address state relations with sovereign tribal nations.

MORE MONEY FOR TEACHER PAY, SCHOLARSHIPS

Public education netted Gianforte his first standing ovation of the night, nearly half an hour into his address, as he singled out the $100 million proposed in his budget to raise teacher pay. The money targets low wages, the most-cited challenge to recruiting and retaining educators across the state. Gianforte’s plan would buttress an effort by several Republican lawmakers to embed pay increases directly into Montana’s public school funding formula. 

“As a son and father of teachers, I’m well aware that teaching is one of the most noble professions,” Gianforte said. “For too long, though, Montana teachers, especially those just beginning their careers, have not been compensated properly for their work.”

In addition to heightened funding for teacher pay, Gianforte announced his intention to increase state support for STEM and trades-based education as well as a proposed $6 million boost to the Big Sky Scholarship Program, a dollar-for-dollar tax credit for private donations supporting public school programs and private school scholarships. 

The governor also reiterated a commitment to “creating a distraction-free learning environment” for students by banning or restricting smartphones in schools. Gianforte’s budget includes $1 million to fund state grants incentivizing local districts to adopt such policies. Hellgate Elementary School District Superintendent Molly Blakely, who has imposed a cellphone-free policy, was a governor’s guest.

Gianforte proposed requiring parental consent for child use of social media and a ban on companies selling data about children using social media. He also called on legislators to empower the state government to investigate companies that violate the law. 

“We should require default privacy settings for minors on social media,” Gianforte said. “We should have a curfew, a blackout, on social media overnight for kids. Kids need more rest. Not more reels on Instagram. They need more sleep. Not more Snapchat.” 

COURT CRITICISMS AND GENDER LAWS

Gianforte spent a portion of his remarks focusing on Republican losses before Montana judges on laws related to transgender Montanans. 

The governor chastised state courts for alleged liberal bias and credited “extreme-left, dark-money groups who devise clever names to hide their intent” with electing sympathetic judges. Montana’s two newly elected state Supreme Court justices sat beneath Gianforte as he spoke, alongside other members of the bench.

Gianforte backed partisan judicial races, a major change from current nonpartisan elections. The Legislature will consider that proposal in the coming days. Newly elected Chief Justice Cory Swanson declined to comment about the governor’s remarks.

Democrats remained seated during many of the governor’s comments about sex and gender laws, while their Republican colleagues rewarded Gianforte with several standing ovations. One member of the minority party who was not present in the chamber was Rep. Zooey Zephyr, D-Missoula, a transgender lawmaker and outspoken advocate for the LGTBQ+ community.

“The Governor used his speech to repeatedly attack trans Montanans & push for further restrictions on our ability to exist in public,” Zephyr wrote in a later comment on social media. “These continued unconstitutional attacks have no place in Montana.”

‘ALL-OF-THE-ABOVE’ ENERGY AND INFRASTRUCTURE INITIATIVES

Gianforte also touched on energy production and consumer energy bills, using the address as an opportunity to draw a comparison between his vision for the United States’ energy future and soon-to-be-former President Joe Biden’s.

“The heavy hand of the federal government has thwarted energy development. We need affordable, reliable power, and we need the federal government’s support, not obstruction. We need to unleash Montana and America’s all-of-the-above energy production,” Gianforte said, going on to announce his Unleashing Energy Task Force, which he said would build on the Legislature’s energy-related work.

Over the past four years, Gianforte has frequently criticized the Biden administration for its focus on limiting emissions of climate-warming greenhouse gases. In late November, Gianforte issued a statement denouncing the Bureau of Land Management’s moratorium on new coal leases in the Powder River Basin, which holds the country’s largest recoverable coal reserves. Within two weeks, Wyoming and Montana sued the BLM over the moratorium.

During his tenure as governor, Gianforte has supported a variety of energy companies and projects, including the Colstrip power plant and the coal mine that fuels it, a nearly $1 billion eastern Montana wind farm, a new high-voltage transmission line, and a biofuel refinery that Montana Renewables, a subsidiary of Calumet, opened in Great Falls in 2021. 

Gianforte did not use the word “climate” in his address Monday, but he did mention funding goals geared toward making the state more resilient to natural disasters, such as the siphon failures that last June left northern Montana communities dependent on the St. Mary River for drinking water and irrigation in a lurch.

Gianforte highlighted two items in his budget oriented toward such infrastructure: a $100 million one-time allocation for state projects “that reduce or eliminate long-term risk to people and property from natural disasters like aging levees and canals that might fail,” and a $10 million annual boost in bridge repairs.

REBUTTALS FROM DEMOCRATS, FREEDOM CAUCUS

Democrats highlighted a number of shared political priorities with Gianforte, including affordable housing and education. The minority party balked at Gianforte’s call for partisan judicial races. 

“Democrats will be working hard to make Montana fair by bringing tax [relief] and renewing Medicaid,” Sen. Shane Morigeau, D-Missoula, said in his address.

Morigeau identified the well-being of Native American communities in Montana as one of the Democratic caucus’ focus areas. In an interview after the address, Morigeau also cast doubt on Gianforte’s rosy picture of Montana’s financial future.

“People can say, ‘we’re going to reduce taxes,’ but how much is that for you, how much is that for big corporations and how much of that is that for working Montanans?”

Gianforte’s speech received mixed reactions from the conservative Montana Freedom Caucus, a mix of hyper-conservative Republican lawmakers from the House and Senate, some of whom did not attend the governor’s remarks. 

In a press conference after the speech, caucus chair and Rep. Jerry Schillinger, R-Circle, said the group is prioritizing property tax reductions, a limited state budget, election and border security and judicial reform. He also advocated for ending Medicaid expansion and curtailing abortion. 

The group said it appreciated Gianforte’s calls for tighter laws regulating the judiciary and could see some places where their members’ proposals for property tax reductions could live alongside the governor’s homestead exemption.

“Let’s pass them both,” said Sen. Carl Glimm, R-Kila. “Why not?”