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For Immediate Release - November 14, 2000
Anastasia Burton
(406) 444-5523

Governor Racicot Presents Overview of His Final Budget

(Helena) --- Governor Marc Racicot released today an overview of his administration's final executive budget, proposing significant investments in public health and human services, higher education, teacher retention and recruitment and economic development programs. The governor will present his budget to the 2001 Legislature. However, Governor-elect Judy Martz may modify the budget after she is sworn into office January 2.

"We are proposing significant investments in needed areas," Governor Racicot said. "For example, Public Health and Human Services investments target expanded caseloads, provider rate increases and increasing the pool of children eligible for the Children's Health Insurance Program (CHIP), by increasing the upper limit to 175% of poverty. Additional investments in the Montana University System are intended to reduce the pressures to raise tuition. Teacher shortage and retention issues will receive an investment of $2 million. We also continue the substantial investments in economic development activities which were approved in the May 2000 Special Legislative Session."

Governor Racicot's budget includes a tax increase on cigarettes and tobacco that would raise an additional $24 million per year. Governor Racicot noted that Montana's tobacco tax is currently 12th lowest in the nation and has not been increased since 1989.

"Montana is spending millions of dollars on tobacco-related illnesses, prevention and education. It is fitting and proper to increase the tax on tobacco products as a further deterrent, in tandem with the methods we are already using to discourage, and hopefully reduce, tobacco use."

Increases in tobacco tax revenues are directed within the Governor's budget toward the Governor's long-range building program and to help pay for veterans' services and the general fund.

Governor Racicot's budget leaves a general fund balance of $42 million at the end of the 2003 biennium. Official revenue estimates will be adopted by the Revenue and Taxation Committee of the Montana Legislature. The estimates will be updated throughout the Legislative session, as more information becomes available.


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