Montana Rep. Shane Morigeau, CSKT Member, Introduces Bill for Tribal Inclusion in State Coal Fund Loans

Montana’s seven federally recognized Tribes may receive parity with state agencies, counties, cities, towns, school districts and other governmental entities to take out loans from the state Coal Tax Fund for infrastructure projects—thanks to House Bill House Bill 428, introduced Monday by Rep. Shane Morigeau, D-Missoula.

Morigeau, a member of the Confederated Salish and Kootenai Tribes, said: “These programs provide more tools for Tribal government to improve infrastructure and create jobs in local communities, which is good for all of Montana.”

Montana established the Coal Tax Trust Fund in 1975, receiving 50 percent of all coal severance tax revenues. The billion-dollar fund typically receives an additional $50-60 million in tax revenues per year, according to the Department of Agricultural Economics and Economics at Montana State University (AgEconMT).

Rep. Shane Morigeau

Generally speaking, “some interest earned from the fund is withdrawn (or alternatively, funds are used to disperse loans to local governments or companies) to fund several types of beneficial activities, including renewable energy development, local infrastructure, regional water systems, and others. However, most of the interest revenue is transferred into the state’s general fund, providing overall budget relief,” states AgEconMT.

The Montana Board of Investments has slated 25 percent of the state’s Coal Tax Fund annually for infrastructure investments—often disseminated through the state’s INTERCAP program. 

In fiscal year 2018, Montana’s INTERCAP Loan Program funded $20.6 million worth of loans to non-Tribal governments with variable-rate loans for infrastructure projects. (The INTERCAP interest rate was 3.15 percent for February 2018-February 2019.) Through the program, 100 percent of financing is available with no up-front cost, equity, or matching funds required.

Carole Lankford, Confederated Salish and Kootenai Tribes council member, told the Missoulian: “Unlike most governments, Tribal governments have very limited opportunities to impose taxes or to issue tax-exempt bonds. While we are proud of our accomplishments over the years, we are confident that with additional financing opportunities, we will be able to do even more.”

State lawmakers are considering the bill debated Monday in the Montana House Appropriations Committee.

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