- 2025
69th Legislature 2025 HB0863.2
- 1 - Authorized Print Version – HB 863
1 HOUSE BILL NO. 863
2 INTRODUCED BY L. JONES, J. ESP, C. GLIMM, D. BEDEY, B. MERCER, E. TILLEMAN, K. WALSH
3
4 A BILL FOR AN ACT ENTITLED: “AN ACT GENERALLY REVISING STATE FINANCE LAWS; REQUIRING
5 THE BOARD OF INVESTMENTS TO PERFORM DUTIES IN A RESTRICTED ENTERPRISE FUND TYPE;
6 ALLOWING THE DEPARTMENT OF REVENUE TO WAIVE INTEREST ON UNDERPAID ESTIMATED
7 TAXES; TEMPORARILY ALLOWING USE OF THE ACCOMMODATIONS TAX FOR HISTORICAL SITES AT
8 REEDER'S ALLEY AND VIRGINIA CITY; PROVIDING FOR TIMELY TRANSFER OF LEGISLATIVE SPACE;
9 PROVIDING AN APPROPRIATION; PROVIDING CONTINGENT APPROPRIATIONS; PROVIDING FOR A
10 STUDY FOR THE OFFICE OF BUDGET AND PROGRAM PLANNING ON EXECUTIVE AGENCY
11 STRUCTURE AND OPERATIONS AND MARKET AND ACTUAL WAGES; REQUESTING THAT THE
12 GOVERNOR CALL A SPECIAL SESSION IF CERTAIN FEDERAL ACTIONS AFFECTING MONTANA'S
13 ECONOMY OCCUR; AMENDING SECTION SECTIONS 2-15-1808, 15-30-2512, 15-65-121, AND 17-7-102,
14 MCA; AND PROVIDING AN EFFECTIVE DATE.”
15
16 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
17
18ECTION 1. Section 2-15-1808, MCA, is amended to read:
19 "2-15-1808. (1)
20 There is a board of investments within the department of commerce.
21 (2) Except as otherwise provided in this subsection, the board is allocated to the department for
22 administrative purposes as prescribed in 2-15-121. The board may employ a chief investment officer and an
23 executive director who have general responsibility for selection and management of the board's staff and for
24 direct investment and economic development activities. The board shall prescribe the duties and annual
25 salaries of the chief investment officer, executive director, and six professional staff positions. The chief
26 investment officer, executive director, and six professional staff serve at the pleasure of the board.
27 (3) The board is composed of nine members appointed by the governor, as prescribed in 2-15-
28 124, and two ex officio, nonvoting members. The members are: - 2025
69th Legislature 2025 HB0863.2
- 2 - Authorized Print Version – HB 863
1 (a) one member from the public employees' retirement board, provided for in 2-15-1009, and one
2 member from the teachers' retirement board provided for in 2-15-1010. If either member of the respective
3 retirement boards ceases to be a member of the retirement board, the position of that member on the board of
4 investments is vacant, and the governor shall fill the vacancy in accordance with 2-15-124.
5 (b) seven members who will provide a balance of professional expertise and public interest and
6 accountability, who are informed and experienced in the subject of investments, and who are representatives
7 of:
8 (i) the financial community;
9 (ii) small business;
10 (iii) agriculture; and
11 (iv) labor; and
12 (c) two ex officio, nonvoting legislative liaisons to the board, of which one must be a senator
13 appointed by the president of the senate and one must be a representative appointed by the speaker of the
14 house. The liaisons may not be from the same political party. Preference in appointments is to be given to
15 legislators who have a background in investments or finance. The legislative liaisons shall serve from
16 appointment through each even-numbered calendar year and may attend all board meetings. Legislative
17 liaisons appointed pursuant to this subsection (3)(c) are entitled to compensation and expenses, as provided in
18 5-2-302, to be paid by the legislative council.
19 (4) The board is designated as a quasi-judicial board for the purposes of 2-15-124.
20 (5) The board shall perform all duties outlined in 2-15-121 subject to the restrictions of Title 17,
21 chapters 5 and 6, in a restricted enterprise fund type pursuant to 17-2-102.
22 (6) (a) The board shall prepare and present on its budget to the following committees on at least a
23 biannual basis:
24 (i) the legislative finance committee;
25 (ii) the state administrative and veterans' affairs interim committee; and
26 (iii) the general government interim budget committee.
27 (b) During each legislative session, the board shall report to the house appropriations committee,
28 the senate finance and claims committee, and the general government joint appropriations subcommittee upon - 2025
69th Legislature 2025 HB0863.2
- 3 - Authorized Print Version – HB 863
1 request."
2
3ECTION 2. Section 15-30-2512, MCA, is amended to read:
4 "15-30-2512. (1) (a) Each individual subject to
5 tax under this chapter, except farmers or ranchers as defined in subsection (6), shall pay for the tax year,
6 through employer withholding, as provided in 15-30-2502, through payment of estimated tax in four
7 installments, as provided in subsection (2) of this section, or through a combination of employer withholding and
8 estimated tax payments, at least:
9 (i) 90% of the tax for the current tax year, less tax credits and withholding allowed the taxpayer; or
10 (ii) an amount equal to 100% of the individual's tax liability for the preceding tax year, if the
11 preceding tax year was a period of 12 months and if the individual filed a return for the tax year.
12 (b) Payment of estimated taxes under this section is not required if:
13 (i) the combined tax liability of employer withholding and estimated tax for the current year is less
14 than $500 after reductions for credits and withholding;
15 (ii) the individual did not have any tax liability for the preceding tax year, which was a tax year of
16 12 months, and if the individual was a citizen or resident of the United States throughout that tax year;
17 (iii) the underpayment was caused by reason of casualty, disaster, or other unusual circumstances
18 that the department determines to constitute good cause; or
19 (iv) the individual retired in the tax year after having attained the age of 62 or if the individual
20 became disabled in the tax year. In addition, payment of estimated taxes under this section is not required in
21 the tax year following the tax year in which the individual retired or became disabled.
22 (2) Estimated taxes must be paid in four installments according to one of the following schedules:
23 (a) Subject to the due date provision in 15-30-2604(1)(b), for each taxpayer whose tax year begins
24 on January 1, estimated tax payments are due on the following dates:
INSTALLMENTDateFirstApril 15SecondJune 15 - 2025
69th Legislature 2025 HB0863.2
- 4 - Authorized Print Version – HB 863
ThirdSeptember 15FourthJanuary 15 of the following tax year
1 (b) Subject to the due date provision in 15-30-2604(1)(b), for each taxpayer whose tax year begins
2 on a date other than January 1, estimated tax payments are due on the following dates:
InstallmentDateFirst15th day of the 4th month following the beginning of the tax yearSecond15th day of the 6th month following the beginning of the tax yearThird15th day of the 9th month following the beginning of the tax yearFourth15th day of the month following the close of the tax year
3 (3) (a) Except as provided in subsection (4), each installment must be 25% of the required annual
4 payment determined pursuant to subsection (1). If the taxpayer's tax situation changes, each succeeding
5 installment must be proportionally changed so that the balance of the required annual payment is paid in equal
6 installments over the remaining period of time.
7 (b) If the taxpayer's tax situation changes after the date for the first installment or any subsequent
8 installment, as specified in subsection (2)(a) or (2)(b), so that the taxpayer is required to pay estimated taxes,
9 the taxpayer shall pay 25% for each succeeding installment except for the first one in which a payment is
10 required. For estimated taxes required to be paid beginning with the second installment provided for in
11 subsection (2)(a) or (2)(b), the taxpayer shall pay 50% for that installment and 25% for the third and fourth
12 installments, respectively. For estimated taxes required to be paid beginning with the third installment provided
13 for in subsection (2)(a) or (2)(b), the taxpayer shall pay 75% for that installment and 25% for the fourth
14 installment.
15 (4) (a) If for any required installment the taxpayer determines that the installment payment is less
16 than the amount determined under subsection (3)(a), the lower amount may be paid as an annualized income
17 installment.
18 (b) For any required installment, the annualized income installment is the applicable percentage
19 described in subsection (4)(c) applied to the tax computed on the basis of annualized Montana taxable income
20 in the tax year for the months ending before the due date for the installment less the total amount of any prior
21 required installments for the tax year. - 2025
69th Legislature 2025 HB0863.2
- 5 - Authorized Print Version – HB 863
1 (c) For the purposes of this subsection (4), the applicable percentage is determined according to
2 the following schedule:
Required InstallmentApplicable PercentageFirst22.5%Second45%Third67.5%Fourth90%
3 (d) A reduction in a required installment resulting from the application of an annualized income
4 installment must be recaptured by increasing the amount of the next required installment, determined under
5 subsection (3)(a), by the amount of the reduction. Any subsequent installment must be increased by the
6 amount of the reduction until the amount has been recaptured.
7 (5) (a) Subject to subsection (5)(e), if an estimated tax, an employer withholding tax, or a
8 combination of estimated tax and employer withholding tax is underpaid, there must be added to the amount
9 due under this chapter interest on the amount of the underpayment as provided in 15-1-216. The interest is
10 computed on the amount of the underpayment, as determined in subsection (5)(b), for the period from the time
11 the payment was due to the date payment was made or to the 15th day of the 4th month of the year following
12 the tax year in which the payment was to be made, whichever is earlier.
13 (b) For the purpose of determining the amount of interest due in subsection (5)(a), the amount of
14 the underpayment is the required installment amount less the installment amount paid, if any, on or before the
15 due date for the installment.
16 (c) For the purpose of determining the amount of interest due in subsection (5)(a), an estimated
17 payment must be credited against unpaid required installments in the order in which those installments are
18 required to be paid.
19 (d) Interest may not be charged with respect to any underpayment of the fourth installment of
20 estimated taxes if:
21 (i) the taxpayer pays in full the amount computed on the return as payable; and
22 (ii) the taxpayer files a return on or before the last day of the month following the close of the tax
23 year referred to in subsection (2)(a) or (2)(b). - 2025
69th Legislature 2025 HB0863.2
- 6 - Authorized Print Version – HB 863
1 (e) Interest on the underpayment of estimated tax may not be assessed against a taxpayer if the
2 tax paid by the taxpayer from employer withholding and estimated tax payments satisfies the requirements of
3 subsection (1)(a)(i) or (1)(a)(ii) and the taxpayer has paid approximately equal quarterly installments of
4 estimated taxes.
5 (6) For the purposes of this section, "farmer or rancher" means a taxpayer who derives at least
6 66 2/3% of the taxpayer's gross income, determined for federal income tax purposes, from farming or
7 ranching operations, or both.
8 (7) The department shall promulgate rules governing reasonable extensions of time for paying the
9 estimated tax. An extension may not be for more than 6 months.
10 (8) Notwithstanding 15-1-206(2), the department may, in its discretion, waive the interest required
11 to be added under subsection (5), for underpaid estimated taxes attributable to the 2024 tax year, if the
12 taxpayer:
13 (i) timely files a Montana income tax return for the 2024 income tax year, as provided in 15-3024
14 2604; and
15 (ii) when filing the return as provided in subsection (8)(a)(i), pays to the department any balance of
16 income tax remaining unpaid.
17 (b) The waiver authority provided for under this subsection (8) terminates January 1, 2026."
18
19ECTION 3. Section 15-65-121, MCA, is amended to read:
20 "15-65-121.
21 65-111 must, in accordance with the provisions of 17-2-124, be deposited in an account in the state special
22 revenue fund to the credit of the department. The department may spend from that account in accordance with
23 an expenditure appropriation by the legislature based on an estimate of the costs of collecting and disbursing
24 the proceeds of the tax. Before allocating the balance of the tax proceeds in accordance with the provisions of
25 17-2-124 and as provided in subsections (2)(a) through (2)(j) (2)(k) of this section, the department shall
26 determine the expenditures by state agencies for in-state lodging for each reporting period and deduct 4% of
27 that amount from the tax proceeds received each reporting period. The department shall distribute the portion
28 of the 4% that was paid with federal funds to the department of administration for return to the federal - 2025
69th Legislature 2025 HB0863.2
- 7 - Authorized Print Version – HB 863
1 government and deposit 30% of the amount deducted less the portion paid with federal funds in the state
2 general fund.
3 (2) The balance of the tax proceeds received each reporting period and not deducted pursuant to
4 the expenditure appropriation, deposited in the state general fund, distributed to agencies that paid the tax with
5 federal funds, or deposited in the heritage preservation and development account must be transferred to an
6 account in the state special revenue fund to the credit of the department of commerce for the purposes
7 designated under 90-1-122, to the emergency lodging for victims of domestic violence or human trafficking
8 account, to the Montana historical interpretation state special revenue account, to the Montana historical
9 society, to the university system, to the state-tribal economic development commission, and to the department
10 of fish, wildlife, and parks, as follows:
11 (a) 1% to the Montana historical society to be used for the installation or maintenance of roadside
12 historical signs and historic sites;
13 (b) 2.5% to the university system for the establishment and maintenance of a Montana travel
14 research program;
15 (c) 6.5% to the department of fish, wildlife, and parks for the maintenance of facilities in state parks
16 that have both resident and nonresident use;
17 (d) 1.4% to the invasive species state special revenue account established in 80-7-1004;
18 (e) 60.2% to be used directly by the department of commerce as provided in 90-1-122[, and in part
19 to renovate the Miles City train depot];
20 (f) 0.1% to the emergency lodging for victims of domestic violence or human trafficking account
21 established in 44-4-1506;
22 (g) (i) except as provided in subsection (2)(g)(ii), 22.5% to be distributed by the department to
23 regional nonprofit tourism corporations in the ratio of the proceeds collected in each tourism region to the total
24 proceeds collected statewide; and
25 (ii) if 22.5% of the proceeds collected annually within the limits of a city, consolidated city-county,
26 resort area, or resort area district exceeds $35,000, 50% of the amount available for distribution to the regional
27 nonprofit tourism corporation in the region where the city, consolidated city-county, resort area, or resort area
28 district is located, to be distributed to the nonprofit convention and visitors bureau in that city, consolidated city- - 2025
69th Legislature 2025 HB0863.2
- 8 - Authorized Print Version – HB 863
1 county, resort area, or resort area district;
2 (h) 0.5% to the state special revenue account provided for in 90-1-135 for use by the state-tribal
3 economic development commission established in 90-1-131 for activities in the Indian tourism region;
4 (i) 2.6% to the Montana historical interpretation state special revenue account established in 22-3-
5 115; and
6 (j) 2.7% or $1 million, whichever is less, to the Montana heritage preservation and development
7 account provided for in 22-3-1004. The Montana heritage preservation and development commission shall
8 report on the use of funds received pursuant to this subsection (2)(j) to the legislative finance committee on a
9 semiannual basis, in accordance with 5-11-210; and
10 (k) $250,000 in each year of the biennium beginning July 1, 2025, to the Montana heritage
11 commission for projects at Reeder's Alley in Helena and Grace Methodist Church in Virginia City.
12 (3) If a city, consolidated city-county, resort area, or resort area district qualifies under 15-68-
13 820(5)(b)(iii) or this section for funds but fails to either recognize a nonprofit convention and visitors bureau or
14 submit and gain approval for an annual marketing plan as required in 15-65-122, then those funds must be
15 allocated to the regional nonprofit tourism corporation in the region in which the city, consolidated city-county,
16 resort area, or resort area district is located.
17 (4) If a regional nonprofit tourism corporation fails to submit and gain approval for an annual
18 marketing plan as required in 15-65-122, then those funds otherwise allocated to the regional nonprofit tourism
19 corporation may be used by the department of commerce for tourism promotion and promotion of the state as a
20 location for the production of motion pictures and television commercials.
21 (5) The tax proceeds received that are transferred to a state special revenue account pursuant to
22 subsections (2)(a) through (2)(c), (2)(e), and (2)(g) are statutorily appropriated to the entities as provided in 17-
23 7-502. The tax proceeds received that are transferred to the emergency lodging for victims of domestic violence
24 or human trafficking account pursuant to subsection (2)(f) are subject to the appropriation provisions in 44-4-
25 1506.
26 (6) The tax proceeds received that are transferred to the invasive species state special revenue
27 account pursuant to subsection (2)(d), to the Montana historical interpretation state special revenue account
28 pursuant to subsection (2)(i), and to the Montana heritage preservation and development account pursuant to - 2025
69th Legislature 2025 HB0863.2
- 9 - Authorized Print Version – HB 863
1 subsection (2)(j) are subject to appropriation by the legislature. (Terminates June 30, 2027--sec. 12, Ch. 563, L.
2 2021; sec. 10, Ch. 758, L. 2023; bracketed language in subsection (1)(e) terminates June 30, 2025--sec. 34,
3 Ch. 763, L. 2023.)
4
5 imposed by 15-65-111 must, in accordance with the provisions of 17-2-124, be deposited in an account in the
6 state special revenue fund to the credit of the department. The department may spend from that account in
7 accordance with an expenditure appropriation by the legislature based on an estimate of the costs of collecting
8 and disbursing the proceeds of the tax. Before allocating the balance of the tax proceeds in accordance with
9 the provisions of 17-2-124 and as provided in subsections (2)(a) through (2)(h) of this section, the department
10 shall determine the expenditures by state agencies for in-state lodging for each reporting period and deduct 4%
11 of that amount from the tax proceeds received each reporting period. The department shall distribute the
12 portion of the 4% that was paid with federal funds to the department of administration for return to the federal
13 government and deposit 30% of the amount deducted less the portion paid with federal funds in the state
14 general fund. The amount of $400,000 each year must be deposited in the Montana heritage preservation and
15 development account provided for in 22-3-1004.
16 (2) The balance of the tax proceeds received each reporting period and not deducted pursuant to
17 the expenditure appropriation, deposited in the state general fund, distributed to agencies that paid the tax with
18 federal funds, or deposited in the heritage preservation and development account must be transferred to an
19 account in the state special revenue fund to the credit of the department of commerce for the purposes
20 designated under 90-1-122, to the Montana historical interpretation state special revenue account, to the
21 Montana historical society, to the university system, to the state-tribal economic development commission, and
22 to the department of fish, wildlife, and parks, as follows:
23 (a) 1% to the Montana historical society to be used for the installation or maintenance of roadside
24 historical signs and historic sites;
25 (b) 2.5% to the university system for the establishment and maintenance of a Montana travel
26 research program;
27 (c) 6.5% to the department of fish, wildlife, and parks for the maintenance of facilities in state parks
28 that have both resident and nonresident use; - 2025
69th Legislature 2025 HB0863.2
- 10 - Authorized Print Version – HB 863
1 (d) 1.4% to the invasive species state special revenue account established in 80-7-1004;
2 (e) 63% to be used directly by the department of commerce as provided in 90-1-122;
3 (f) (i) except as provided in subsection (2)(f)(ii), 22.5% to be distributed by the department to
4 regional nonprofit tourism corporations in the ratio of the proceeds collected in each tourism region to the total
5 proceeds collected statewide; and
6 (ii) if 22.5% of the proceeds collected annually within the limits of a city, consolidated city-county,
7 resort area, or resort area district exceeds $35,000, 50% of the amount available for distribution to the regional
8 nonprofit tourism corporation in the region where the city, consolidated city-county, resort area, or resort area
9 district is located, to be distributed to the nonprofit convention and visitors bureau in that city, consolidated city-
10 county, resort area, or resort area district;
11 (g) 0.5% to the state special revenue account provided for in 90-1-135 for use by the state-tribal
12 economic development commission established in 90-1-131 for activities in the Indian tourism region; and
13 (h) 2.6% to the Montana historical interpretation state special revenue account established in 22-3-
14 115.
15 (3) If a city, consolidated city-county, resort area, or resort area district qualifies under 15-68-
16 820(5)(b)(iii) or this section for funds but fails to either recognize a nonprofit convention and visitors bureau or
17 submit and gain approval for an annual marketing plan as required in 15-65-122, then those funds must be
18 allocated to the regional nonprofit tourism corporation in the region in which the city, consolidated city-county,
19 resort area, or resort area district is located.
20 (4) If a regional nonprofit tourism corporation fails to submit and gain approval for an annual
21 marketing plan as required in 15-65-122, then those funds otherwise allocated to the regional nonprofit tourism
22 corporation may be used by the department of commerce for tourism promotion and promotion of the state as a
23 location for the production of motion pictures and television commercials.
24 (5) The tax proceeds received that are transferred to a state special revenue account pursuant to
25 subsections (2)(a) through (2)(c), (2)(e), and (2)(f) are statutorily appropriated to the entities as provided in 17-
26 7-502.
27 (6) The tax proceeds received that are transferred to the invasive species state special revenue
28 account pursuant to subsection (2)(d) and to the Montana historical interpretation state special revenue account - 2025
69th Legislature 2025 HB0863.2
- 11 - Authorized Print Version – HB 863
1 pursuant to subsection (2)(h) are subject to appropriation by the legislature."
2
3 Section 17-7-102, MCA, is amended to read:
4 "17-7-102. As used in this chapter, the following definitions apply:
5 (1) "Additional services" means different services or more of the same services.
6 (2) "Agency" means all offices, departments, boards, commissions, institutions, universities,
7 colleges, and any other person or any other administrative unit of state government that spends or encumbers
8 public money by virtue of an appropriation from the legislature under 17-8-101.
9 (3) "Approving authority" means:
10 (a) the governor or the governor's designated representative for executive branch agencies;
11 (b) the chief justice of the supreme court or the chief justice's designated representative for judicial
12 branch agencies;
13 (c) the speaker for the house of representatives;
14 (d) the president for the senate;
15 (e) appropriate legislative committees or a designated representative for legislative branch
16 agencies; or
17 (f) the board of regents of higher education or its designated representative for the university
18 system.
19 (4) (a) "Base budget" means the resources for the operation of state government that are of an
20 ongoing and nonextraordinary nature in the current biennium. The base budget for the state general fund and
21 state special revenue funds may not exceed that level of funding authorized by the previous legislature.
22 (b) The term does not include:
23 (i) funding for water adjudication if the accountability benchmarks contained in 85-2-271 are not
24 met;
25 (ii) funding for petroleum storage tank leak prevention if the accountability benchmarks in 75-11-
26 521 are not met.
27 (5) "Budget amendment" means a temporary appropriation as provided in Title 17, chapter 7, part
28 4. - 2025
69th Legislature 2025 HB0863.2
- 12 - Authorized Print Version – HB 863
1 (6) "Budget stabilization reserve" means the amount of unappropriated fund balance in the budget
2 stabilization reserve fund up to 16% of all general revenue appropriations in the second year of the biennium.
3 (7) "Emergency" means a catastrophe, disaster, calamity, or other serious unforeseen and
4 unanticipated circumstance that has occurred subsequent to the time that an agency's appropriation was made,
5 that was clearly not within the contemplation of the legislature and the governor, and that affects one or more
6 functions of a state agency and the agency's expenditure requirements for the performance of the function or
7 functions.
8 (8) "Funds subject to appropriation" means those funds required to be paid out of the treasury as
9 set forth in 17-8-101.
10 (9) "General revenue appropriations" means appropriations from the general fund or and the
11 school equalization and property tax reduction account in 20-9-336.
12 (10) "Necessary" means essential to the public welfare and of a nature that cannot wait until the
13 next legislative session for legislative consideration.
14 (11) "New proposals" means requests to provide new nonmandated services, to change program
15 services, to eliminate existing services, or to change sources of funding. For purposes of establishing the
16 present law base, the distinction between new proposals and the adjustments to the base budget to develop
17 the present law base is to be determined by the existence of constitutional or statutory requirements for the
18 proposed expenditure. Any proposed increase or decrease that is not based on those requirements is
19 considered a new proposal.
20 (12) "Operating reserve" means an amount equal to 8.3% of all general revenue appropriations in
21 the second year of the biennium.
22 (13) "Present law base" means that level of funding needed under present law to maintain
23 operations and services at the level authorized by the previous legislature, including but not limited to:
24 (a) changes resulting from legally mandated workload, caseload, or enrollment increases or
25 decreases;
26 (b) changes in funding requirements resulting from constitutional or statutory schedules or
27 formulas;
28 (c) inflationary or deflationary adjustments; and - 2025
69th Legislature 2025 HB0863.2
- 13 - Authorized Print Version – HB 863
1 (d) elimination of nonrecurring appropriations.
2 (14) "Program" means a principal organizational or budgetary unit within an agency.
3 (15) "Requesting agency" means the agency of state government that has requested a specific
4 budget amendment.
5 (16) "University system unit" means the board of regents of higher education; office of the
6 commissioner of higher education; university of Montana, with campuses at Missoula, Butte, Dillon, and
7 Helena; Montana state university, with campuses at Bozeman, Billings, Havre, and Great Falls; the agricultural
8 experiment station, with central offices at Bozeman; the forest and conservation experiment station, with central
9 offices at Missoula; the cooperative extension service, with central offices at Bozeman; the bureau of mines and
10 geology, with central offices at Butte; the fire services training school at Great Falls; and the community
11 colleges supervised and coordinated by the board of regents pursuant to 20-15-103. (Terminates June 30,
12 2028--sec. 11, Ch. 269, L. 2015.)
13 As used in this chapter, the following definitions
14 apply:
15 (1) "Additional services" means different services or more of the same services.
16 (2) "Agency" means all offices, departments, boards, commissions, institutions, universities,
17 colleges, and any other person or any other administrative unit of state government that spends or encumbers
18 public money by virtue of an appropriation from the legislature under 17-8-101.
19 (3) "Approving authority" means:
20 (a) the governor or the governor's designated representative for executive branch agencies;
21 (b) the chief justice of the supreme court or the chief justice's designated representative for judicial
22 branch agencies;
23 (c) the speaker for the house of representatives;
24 (d) the president for the senate;
25 (e) appropriate legislative committees or a designated representative for legislative branch
26 agencies; or
27 (f) the board of regents of higher education or its designated representative for the university
28 system. - 2025
69th Legislature 2025 HB0863.2
- 14 - Authorized Print Version – HB 863
1 (4) "Base budget" means the resources for the operation of state government that are of an
2 ongoing and nonextraordinary nature in the current biennium. The base budget for the state general fund and
3 state special revenue funds may not exceed that level of funding authorized by the previous legislature.
4 (5) "Budget amendment" means a temporary appropriation as provided in Title 17, chapter 7, part
5 4.
6 (6) "Budget stabilization reserve" means the amount of unappropriated fund balance in the budget
7 stabilization reserve fund up to 16% of all general revenue appropriations in the second year of the biennium.
8 (7) "Emergency" means a catastrophe, disaster, calamity, or other serious unforeseen and
9 unanticipated circumstance that has occurred subsequent to the time that an agency's appropriation was made,
10 that was clearly not within the contemplation of the legislature and the governor, and that affects one or more
11 functions of a state agency and the agency's expenditure requirements for the performance of the function or
12 functions.
13 (8) "Funds subject to appropriation" means those funds required to be paid out of the treasury as
14 set forth in 17-8-101.
15 (9) "General revenue appropriations" means appropriations from the general fund or and the
16 school equalization and property tax reduction account in 20-9-336.
17 (10) "Necessary" means essential to the public welfare and of a nature that cannot wait until the
18 next legislative session for legislative consideration.
19 (11) "New proposals" means requests to provide new nonmandated services, to change program
20 services, to eliminate existing services, or to change sources of funding. For purposes of establishing the
21 present law base, the distinction between new proposals and the adjustments to the base budget to develop
22 the present law base is to be determined by the existence of constitutional or statutory requirements for the
23 proposed expenditure. Any proposed increase or decrease that is not based on those requirements is
24 considered a new proposal.
25 (12) "Operating reserve" means an amount equal to 8.3% of all general revenue appropriations in
26 the second year of the biennium.
27 (13) "Present law base" means that level of funding needed under present law to maintain
28 operations and services at the level authorized by the previous legislature, including but not limited to: - 2025
69th Legislature 2025 HB0863.2
- 15 - Authorized Print Version – HB 863
1 (a) changes resulting from legally mandated workload, caseload, or enrollment increases or
2 decreases;
3 (b) changes in funding requirements resulting from constitutional or statutory schedules or
4 formulas;
5 (c) inflationary or deflationary adjustments; and
6 (d) elimination of nonrecurring appropriations.
7 (14) "Program" means a principal organizational or budgetary unit within an agency.
8 (15) "Requesting agency" means the agency of state government that has requested a specific
9 budget amendment.
10 (16) "University system unit" means the board of regents of higher education; office of the
11 commissioner of higher education; university of Montana, with campuses at Missoula, Butte, Dillon, and
12 Helena; Montana state university, with campuses at Bozeman, Billings, Havre, and Great Falls; the agricultural
13 experiment station, with central offices at Bozeman; the forest and conservation experiment station, with central
14 offices at Missoula; the cooperative extension service, with central offices at Bozeman; the bureau of mines and
15 geology, with central offices at Butte; the fire services training school at Great Falls; and the community
16 colleges supervised and coordinated by the board of regents pursuant to 20-15-103."
17
18 NEW SECTION. SECTION 5. TUDY -- COST-OF-LIVING ADJUSTMENTS. DURING THE INTERIM FOLLOWING
1969, THE LEGISLATIVE FINANCE COMMITTEE MAY:
20 (1)5-12-601 A STUDY
21--LIVING ADJUSTMENTS MAY BE APPROPRIATE BASED ON A STATE EMPLOYEE'S WORK LOCATION,
22, HOUSING COSTS IN THE AREA, AND RELATED GEOGRAPHIC EXPENSES; OR
23 (2)(1).
24
25 NEW SECTION. SECTION 6. TUDY OF EXECUTIVE AGENCY STRUCTURE AND OPERATIONS --
26. (1) THE OFFICE OF BUDGET AND PROGRAM PLANNING SHALL STUDY THE BENEFITS GENERATED BY ANY
27,2-15-104, TO THE CITIZENS OF MONTANA.
28 (2) AS PART OF THE STUDY, - 2025
69th Legislature 2025 HB0863.2
- 16 - Authorized Print Version – HB 863
1
2MONTANA.
3 (3) THE STUDY MUST INCLUDE AN EXAMINATION OF THE OPERATION AND ADMINISTRATION OF STATE-
4. TMONTANA STATE HOSPITAL,
5 MONTANA CHEMICAL DEPENDENCY CENTER, THE MONTANA MENTAL HEALTH NURSING CARE CENTER, THE INTENSIVE
6, THE MONTANA VETERANS’ HOME, THE EASTERN MONTANA VETERANS’ HOME, AND THE
7MONTANA VETERANS’ HOME.
8 (4) THIS COMPONENTS OF THE STUDY MUST INCLUDE BUT ARE NOT LIMITED TO:
9 (A) THE ORGANIZATION AND STATE ADMINISTRATION OF STATE-OWNED HEALTH CARE FACILITIES IN PEER
10;
11 (B) RESIDENT OUTCOMES AT ’S STATE-OWNED HEALTH CARE FACILITIES;
12 (C) STATE EMPLOYEE RETENTION AND STAFFING;
13 (D);
14 (E) FEDERAL AND STATE COMPLIANCE.
15 (5)HE OFFICE OF BUDGET AND PROGRAM PLANNING SHALL CONSIDER THE FINDINGS OF RELEVANT
16.
17 (6) ALL ASPECTS OF THE STUDY MUST BE CONCLUDED BY SEPTEMBER 1, 2026,
18,.
19 (7) There is appropriated $350,000 from the general fund to the office of budget and program
20 planning for the biennium beginning July 1, 2025, to conduct the study provided for in this section.
21 (8) The office of budget and program planning shall report to the legislative finance committee and
22 work with a subcommittee of the finance committee appointed by the chair of the legislative finance committee
23 on the study and pay for the salary, per diem, and travel expenses of legislative members.
24
25 NEW SECTION. SECTION 7. ARKET WAGE STUDY. (1) T
26. T
27(2)
28 - 2025
69th Legislature 2025 HB0863.2
- 17 - Authorized Print Version – HB 863
1. T
2
3.
4 (2) The following money is appropriated from the designated funds to the office of budget and
5 program planning for the biennium beginning July 1, 2025, to be distributed to agencies to address recruitment
6 and retention issues within executive branch agencies:
7 (a) $10,600,000 from the general fund;
8 (b) $7,600,000 from state special revenue funds;
9 (c) $5,000,000 from federal special revenue funds; and
10 (d) $2,600,000 from proprietary funds.
11 (3) Each request must be reviewed and approved by the budget director of the governor’s office
12 prior to the transfer of appropriation authority to the agency.
13 (4) Funds must be used to adjust base pay for employees upon approval by the budget director
14 and must become a part of the base budget of the receiving agency.
15
16 NEW SECTION. SECTION 8. EDERAL ACTION AND LEGISLATIVE RESPONSE. DURING THE 2027,
17, THE GOVERNOR IS
18, AND MEMBERS OF THE LEGISLATURE ARE
195-3-105, IF INTERNAL
20
21:
22 (1)
23MONTANA BY MORE THAN $5002027 BIENNIUM;
24 (2)
25MONTANA BY MORE THAN $300
26;
27 (3)
28$300 MILLION; OR - 2025
69th Legislature 2025 HB0863.2
- 18 - Authorized Print Version – HB 863
1 (4) A RECESSION IN THE UNITED STATES IS DECLARED BY THE NATIONAL BUREAU OF ECONOMIC
2S1,2026.
3
4 NEW SECTION. SECTION 9. EGISLATIVE SPACE. OJUNE 30, 2025,
5MITCHELL BUILDING LOCATED AT 125 NORTH
6 ROBERTS STREET, HELENA, MONTANA, AS APPROVED BY THE LEGISLATIVE COUNCIL PURSUANT TO 2-17-805(6).
7
8 NEW SECTION. SECTION 10. ONTINGENT APPROPRIATION. IF A SPECIAL SESSION IS CALLED DURING THE
9 2027 BIENNIUM TO ADDRESS FEDERAL ACTIONS OR A RECESSION AS OUTLINED IN [SECTION 8], THERE IS APPROPRIATED
10 $280,000 FROM THE GENERAL FUND TO THE LEGISLATIVE SERVICES DIVISION FOR THE BIENNIUM BEGINNING JULY 1,
11 2025, UPON THE CONVENING OF A SPECIAL SESSION.
12
13 NEW SECTION. Section 11. (1) (A) There is appropriated $100,000 $250,000 from
14 the Montana-Ireland trade and development special revenue account to the department of commerce for the
15 biennium beginning July 1, 2025, for implementing the provisions of Senate Bill No. 320.
16 (2) (B) It is the intent of the legislature that the appropriation IN SUBSECTION (1)(A) be included in the
17 base budget for the department of commerce for the biennium beginning July 1, 2027.
18 (2) (A) THERE IS APPROPRIATED $7,350,000 FROM THE BEHAVIORAL HEALTH SYSTEM FOR FUTURE
1950-1-119 TO THE DEPARTMENT OF PUBLIC HEALTH AND HUMAN SERVICES FOR THE
20JULY 1, 2025,-BASED COURT-ORDERED FORENSIC FITNESS EVALUATIONS.
21 (B) T(2)(A) IS A ONE-TIME-ONLY APPROPRIATION.
22
23 COORDINATION SECTION. SECTION 12. OORDINATION INSTRUCTION. IHOUSE BILL NO. 231
24[] ARE PASSED AND APPROVED, THEN:
25 (1)$90 MILLION FROM THE PROPERTY TAX ASSISTANCE ACCOUNT PROVIDED
26HOUSE BILL NO. 231JULY 1, 2025,
27HOUSE BILL N.231; AND
28 (2)HOUSE BILL NO.231 AMENDING 15-6-1342025 IS VOID AND - 2025
69th Legislature 2025 HB0863.2
- 19 - Authorized Print Version – HB 863
1 15-6-134 MUST BE AMENDED AS FOLLOWS:
2 "15-6-134. LASS FOUR PROPERTY -- DESCRIPTION -- TAXABLE PERCENTAGE.
3 includes:
4 (a) subject to subsection (1)(e), all land, except that specifically included in another class;
5 (b) subject to subsection (1)(e):
6 (i) all improvements, including single-family residences, trailers, manufactured homes, or mobile
7 homes used as a residence, except those specifically included in another class;
8 (ii) appurtenant improvements to the residences, including the parcels of land upon which the
9 residences are located and any leasehold improvements;
10 (iii) vacant residential lots; and
11 (iv) rental multifamily dwelling units.
12 (c) all improvements on land that is eligible for valuation, assessment, and taxation as agricultural
13 land under 15-7-202, including 1 acre of real property beneath improvements on land described in 15-6-
14 133(1)(c). The 1 acre must be valued at market value.
15 (d) 1 acre of real property beneath an improvement used as a residence on land eligible for
16 valuation, assessment, and taxation as forest land under 15-6-143. The 1 acre must be valued at market value.
17 (e) all commercial and industrial property, as defined in 15-1-101, and including:
18 (i) all commercial and industrial property that is used or owned by an individual, a business, a
19 trade, a corporation, a limited liability company, or a partnership and that is used primarily for the production of
20 income;
21 (ii) all golf courses, including land and improvements actually and necessarily used for that
22 purpose, that consist of at least nine holes and not less than 700 lineal yards;
23 (iii) commercial buildings and parcels of land upon which the buildings are situated; and
24 (iv) vacant commercial lots.
25 (2) If a property includes both residential and commercial uses, the property is classified and
26 appraised as follows:
27 (a) the land use with the highest percentage of total value is the use that is assigned to the
28 property; and - 2025
69th Legislature 2025 HB0863.2
- 20 - Authorized Print Version – HB 863
1 (b) the improvements are apportioned according to the use of the improvements.
2 (3) (a) Except as provided in 15-24-1402, 15-24-1501, 15-24-1502, and subsection (3)(b) of this
3 section and subject to subsection (5) of this section, class four residential property described in subsections
4 (1)(a) through (1)(d) of this section is taxed at 1.35% 0.76% of market value.
5 (b) The tax rate for the portion of the market value of a single-family residential dwelling in excess
6 of $1.5 million is the residential property tax rate in subsection (3)(a) multiplied by 1.4.
7 (c) The tax rate for commercial property is the residential property tax rate in subsection (3)(a)
8 multiplied by 1.4.
9 (4) Property described in subsection (1)(e)(ii) is taxed at one-half the tax rate established in
10 subsection (3)(c).
11 (5) The tax rate for class four residential property provided for in subsection (3)(a) must be equal to
12 a tax rate that results in revenue from the mill levies provided for in 20-9-331, 20-9-333, and 20-9-
13 360 of not less than $452 million."
14
15 NEW SECTION. Section 13. [This act] is effective July 1, JUNE 30, 2025.
16 - END -