Archive: February 2023

On Your Mark, Get Set, Go!

21 February 2023
Dennis Pyburn
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As Mother’s Day approaches so does the 42nd Montana Women’s Run.

For 42 years, tens of thousands of participants have filled the streets of downtown Billings the Saturday before Mothers Day, wearing the uniquely designed Montana Womenâ Run t-shirt.  This year downtown Billings will once again be a sea of women in jewel toned purple shirts. 

This years artwork features a Bitterroot flower and a butterfly in flight. Billings graphic designer, Jim Heins, states that the butterfly in flight symbolizes the nature of the Womesn Run with the butterfly representing springtime, transformation, life and hope.

The Bitterroot flower has of course been a constant for the Women’s Run as Montana’s state flower, representing the beauty of the state.

Registration is now open for the 42nd annual run, which will be held on May 13 starting at 8 am in downtown Billings. Proceeds from the event benefit charitable organizations in Billings that contribute to women’s health and wellness. 

 The Montana Women’s Run began in 1982 with 200 registrants and celebrated last year with over 4,600 women participating virtually around the world. Today, the race is recognized as the largest running event for women in the state of Montana, and one of the largest all-women’s races in the country. To date, the Montana Women’s Run has donated more than $1,637,500 to local organizations that promote women’s and children’s health and fitness.

The major sponsors of the 2022 Montana Women’s Run are Billings Clinic, ExxonMobil, First Interstate Bank, Graphic Imprints, The Planet 106.7 and KTVQ.

To keep up with news and other related Women’s Run events, visit the Montana Women’s Run Facebook page or the Montana Women’s Run website. To register for any of the events, visit www.womensrun.org.   

Oil, Gas Industry Cries Foul over Biden’s Claims

21 February 2023
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By Bethany Blankley, The Center Square

The Texas and U.S. oil and gas industry is pushing back against claims President Joe Biden made after he implemented policies to restrict domestic investment and production.

In his state of the union address, Biden said, “We’re still going to need oil and gas for a while” but also said he planned to tax “the wealthiest and biggest corporations … to pay their fair share.”

He criticized the oil and gas industry, saying, “Big Oil just reported its profits. Last year, they made $200 billion in the midst of a global energy crisis. I think it’s outrageous.”

After his administration instructed banks to not invest in domestic exploration or production and expanded billions of dollars of federal subsidies into so-called renewable energy companies, Biden said, U.S. oil and gas companies “invested too little of that profit to increase domestic production.”

He said he spoke to industry executives who said, “‘We were afraid you were going to shut down all the oil wells and all the oil refineries anyway, so why should we invest in them?’” He replied, “We’re going to need oil for at least another decade … we’re going to need … production.” Instead of the industry investing in the production “to keep gas prices down,” Biden said, “they used the record profits to buy back their own stock, rewarding their CEOs and shareholders.”

As a result, the president proposed quadrupling the tax on corporate stock buybacks “to close the loopholes that allow the very wealthy to avoid paying their taxes.”

In response, Texas Oil & Gas Association president Todd Staples told The Center Square, “Nothing can hide the facts – the president has asked for greater production from foreign countries while at home his administration has cancelled pipelines, delayed permits, removed federal acreage from being leased and discouraged investment in this critical industry. Americans deserve energy security and its long past time this administration treated oil and natural gas like an asset, not a liability.”

The Texas oil and natural gas industry, which leads the U.S. in energy production, paid a record $24.7 billion in taxes and state royalties in fiscal 2022, the highest in Texas history.

“Punitive tax schemes targeting the energy Americans depend upon for daily living will do nothing but lower production and hurt consumers,” Staples added.

Ed Longanecker, president of the Texas Independent Producers & Royalty Owners Association, pointed out the president recognizing “that oil and natural gas is clearly needed” was a “positive” sign but “the timeframe given was completely implausible. Under any realistic scenario, oil and natural gas will continue to play a critical role in meeting global energy demand, providing unprecedented economic contributions for our country and in protecting our nation’s energy security for many decades to come. To say otherwise is simply political rhetoric. Punishing energy producers is only hurting American consumers, driving energy prices higher, and putting our global allies at risk.”

Longanecker also pointed out that “Texas produced a record level of natural gas last year and near record levels of oil, while also contributing record levels of state taxes and state royalty payments.” The industry also responded to and rose above “the inordinate pressure and regulatory burdens it faces from Washington.” It did so as those in the Permian Basin reduced emissions by over 76% and the Texas natural gas industry fueled Europe, he added.

Representing western companies who’ve fought the administration over canceled lease sales and permits, Western Energy Alliance president Kathleen Sgamma told The Center Square, “It’s unfortunate that Democrats feel a need to be hostile to businesses. Enterprises, such as energy companies, produce the goods and services and pay the wages that fund the entire government and non-profit sectors, yet to the president, it is never enough.”

She also noted that “the oil and natural gas industry pays hundreds of billions in royalties, income taxes, severance taxes, property taxes, and fees to federal, state and local governments. It’s interesting how the White House likes to beat up American oil companies when they do well, but never seems concerned in the lean years or when investors take losses. Returning profits to shareholders is necessary at some point, otherwise why would investors risk their money unless there was some return on their money at some point?

“Without people willing to take a risk with their money, there would be no funding of oil and natural gas projects here in the United States and Saudi Arabia would have to supply our oil, with the Saudi government collecting all the taxes rather than the U.S. government. We can produce that oil here in America, generating profits that create jobs and tax revenue and fund pension plans, or we can just send those hundreds of billions of dollars to Saudi Arabia and Venezuela.”

Tim Stewart, president of the U.S. Oil and Gas Association, agreed, telling The Center Square, “Frankly the President is the last person to be providing investment analysis of the oil and gas industry. His administration all but told Wall Street not to invest in our industry because we would be going away under his watch – then he admitted last night that we are going to be around much longer than his presidency will be.

“The same Administration that misread and then mismanaged the worst energy crisis in 40 years and drew down our Strategic Petroleum Reserve to cover their strategic mistakes, while his policies drove prices to record highs is telling us that we need to ‘do the right thing.’ The same person responsible for the largest deficits on record and trillions in special interest payouts is telling the industry that our investment strategy is flawed. Fortunately, Americans aren’t buying what he is trying to sell.”

Richard Welch, a Houston-based 20-year industry executive, told The Center Square, the president’s proposal was “not only unAmerican but also anti-capitalist. Punishing the oil and gas industry for not expanding its operations after his administration repeatedly said it’s trying to end it is hypocritical.”

Montana Highlights February 15, 2023

21 February 2023
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The Whitefish City Council is considering whether to enact greater restrictions on where marijuana businesses can operate in the downtown core. The discussions are about the possibility of amending the current buffering after several councilors raised concerns that too many marijuana dispensaries have been approved in downtown.

The Bitterroot National Forest has released the Final Supplemental Environmental Impact Statement for the Gold Butterfly Project. The project is a proposed vegetation management and fuels reduction project in the Sapphire Mountains east of Corvallis. A large portion of the proposed treatment acres are within an area designated for insect and disease treatment, The area is impacted by mountain pine beetle, Douglas-fir bark beetle, dwarf mistletoe and western spruce budworm. The aproposed treatments include commercial timber harvest, non-commercial thinning, and prescribed burning to improve forest health.

The Calumet Montana oil refinery in Great Falls has completed the multi-million dollar expansion project begun one  year ago. The refinery is now capable of becoming the largest producer of sustainable aviation fuel in the United States. The $90 million project will allow Calumet to become a major player in the expanding markets for bio-based diesel and sustainable aviation fuel.

The Biden administration has taken the first step Friday toward ending federal protections for grizzly bears in the northern Rocky Mountains. The U.S. Fish and Wildlife Service said the governors of Montana, Idaho and Wyoming provided “substantial” information that grizzlies have recovered from the threat of extinction in the regions surrounding Yellowstone and Glacier national parks. There are now more than 2,000 bears in the Lower 48 states and much larger populations in Alaska, where hunting is allowed.

Brothers Gavin and Joey DeGraw have purchased the Open Range restaurant from Bozeman restaurateur Jay Bentley.The purchase of Open Range has resulted in expanded hours. Open Range is now open seven days a week. Plans are also being made to add lunch hours.

The owner of two downtown Bozeman bars has put the businesses up for sale. Casey Durham,  owner of the Okay Cool Group, said recently that they are listing El Camino and the Kitty Warren Social Club, for sale. The sale will include the option to concession, or rent, the businesses’ liquor license. Both bars are located at 211 E. Main St., Bozeman.

 Official statistics show that 2022  was a good year for the Dawson Community Airport. The numbers show dramatic increases over 2021. Those numbers are heavily inflated due to a temporary change in flight schedules that affected the airport over several months in 2022. According to the MDT’s information, the Dawson Community Airport saw a monthly average increase in ridership of about 99%. These increases in rider numbers are likely due to the change in flight schedules Cape Air enacted in response to a shortage of pilots.

 Taqueria Mi Lindo Michoacan, which loosely translates as “my pretty Michoacan taco shop,” opened during the summer of 2022 in Willston. Thanks to a $5,000 infusion from City of Williston’s Economic Development in the form of a STAR Fund Mini Match, she was able to restock. Navarro makes it clear Taqueria Mi Lindo Michoacan is a restaurant that sells ingredients for patrons to cook their favorite menu items at home.

Build Montana, the heavy equipment program and workforce initiative created through a partnership between the Montana Contractors Association and the Montana Equipment Dealers Association, has been honored nationally for the second time. Build Montana program partners were in Chicago recently to receive the Lester J. Heath Award from the Associated Equipment Distributors Foundation during their annual meeting. Build Montana currently has a program in its third year in Billings, and a program in its second year in Kalispell.

Nearly three months of abundant precipitation across much of Montana nurtured a healthy snowpack coming into the first month of 2023. However weather patterns changed in early January. They produced relatively dry conditions for the month. Southwest Montana received slightly less than normal January precipitation. The report stated that river basins west of the Continental Divide saw a 20% to 30% decrease in snowpack percentages. Rocky Mountain Front basins saw a 30% to 35% decrease since January.

A Dirty Dough Cookie shop will be opened by the Wilda family in Williston, Park Plaza in April. The latest craze in gourmet cookie shops hails from Lindon, Utah, corporate headquarters of Dirty Dough Cookie.

The Izaak Walton Inn in Essex will undergo major remodeling since 1995. The new owners, LOGE Camps, are planning the remodel of the over 84 year old Inn. The new owners are taking steps to keep the historic nature of Inn intact.

State officials emphasized to neighbors of Somers Beach State Park that the overnight accommodations proposed for the park will be unobtrusive. Somers Beach was acquired by the state in October 2021 from the Sliter family. The family previously allowed public access on its property and wanted that access enshrined as well as to see the land protected from future development,

Montana’s redistricting commission has voted 3-2 to finalize new House and Senate maps that will help guide the partisan balance of the state Legislature for the next decade. Chair Maylinn Smith cast the tie-breaking vote in favor of the map. The independent commission also includes two Democrats and two Republicans. The House map is largely derived from one offered by Democrats toward the end of a series of compromises last year, when Smith chose it over the GOP proposal.

The long-term outlook for jobs is positive throughout North Dakota and especially in Region 1, which includes Williams County. Job Service North Dakota’s Labor Market Information Center completed statewide and regional long-term employment projections through 2031. The 2023 results cover more than 700 occupations. Most of the job growth projected for ND over the next decade is in healthcare, construction and extraction, transportation and material moving. – Williston Herald

A Firehouse Subs has opened on the Montana State University campus in Bozeman.

Sidney Sugars Incorporated Inc. announced the closure of the 100-plus year-old sugar beet factory in Sidney. Factory owner, American Crystal Sugar Company claims that there is not enough interest among sugar beet growers to grow an adequate amount of beets to support the factory. Sugar beet growers have stated that the contracts they have been offered over the past few years have not offered prices enough to cover the cost of production, so many have switched to other crops.

Terracon announces the promotion of Marie Maher, P.G., to the position of Principal. With more than 16 years of geological and exploration experience, Marie currently serves as an Assistant National Manager for Terracon Exploration Services for the Western Operating Group in Great Falls. Her responsibilities include growth of the exploration services and development and implementation of initiatives regarding safety, efficiency, and professionalism.

In Great Falls, Alluvion Health’s three school-based health centers have received the Certified Autism Center designation.To receive the CAC designation, the chools met requirements by IBCCES, such as dedication to serving autistic individuals, having at least 80 percent of staff trained and certified, and a commitment to engage in specialized autism training on an ongoing basis.

The Montana Department of Transportation is proposing  to level and resurface about 3.5 miles of Interstate 90, west of Hardin in Bighorn County, beginning approximately 3 miles west of the Toluca Interchange, and extends east, ending approximately half a mile past the interchange. The project is tentatively scheduled for construction in summer of 2023.

Also, the Montana Department of Transportation plans to resurface about 4 miles of Interstate 90 west of Big Timber in Sweet Grass County. The project begins approximately 6 miles east of Springdale, and extends east, ending approximately 4 miles west of Big Timber. The project is tentatively scheduled for construction in the summer of 2025.

The famous M&M Bar in Butte has reopened following its destruction on May, 2021 by fire. The business has been rebuilt next to its original location.

Recent flooding and ice jams have triggered partial closures at Eight Mile Ford and Burnt Tree Hole fishing access sites on the Madison River south of Ennis. The boat ramp areas at these sites are closed due to unstable ice and hazardous flooding conditions. However, the upper walk-in and parking areas remain open.

In the counties…

21 February 2023
Evelyn Pyburn
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Yellowstone County is Montana’s largest economic hub, made so in large part because it serves a four-state regional area. Partly because its economy is based upon success of other states in the region, which have had their own economic struggles, Yellowstone County’s economy has had a “subpar performance for the latter half of the previous decade,” explains economist Pat Barkey, Director of the Bureau of Business and Economic Research.

He referenced areas like the Bakken in North Dakota, whose gas and oil industry has a significant impact on Yellowstone County. Despite that, the county has had some steady improvement over the past two years because of improvement in some of its core industries, which includes “strong visitor spending.”

While Yellowstone County and Billings had strong growth in 2022 at 3.1 percent, Barkey said he is pessimistic about 2023 for the county – projecting a growth of less than zero at – 1.1 percent.

The county’s health care industry, has had “sluggish” growth, which has been the industry’s experience across the state.

Banking and finance, retail, wholesale and transportation-related businesses in Yellowstone County have been enjoying growth.

It was noted that, unlike other areas of the state, much of Yellowstone County’s population growth has been from other counties in the state.

Looking beyond 2023, the BBER forecast was quite a bit better with 2024 projected at 2.4 percent, and 2025 at 3.1 percent and 2026 at 2.0 percent.

Yellowstone County’s most prominent industry (wages as a share relative to US average) is Mining, followed by Wholesale Trade and Health Care, followed by Transportation and Construction.

Defying the law of supply and demand, the number of housing starts over the past two years has slipped, while median sales prices have increased. Housing has barely been able to keep on a par with the county’s population growth which has ranged from 11 percent to 14 percent over the past couple of years. In 1980 housing growth was 46.6 percent in the county while population growth was 23.7 percent.

Recovery in employment over pre-pandemic levels has been strong, with Accommodations and Food having seen phenomenal growth. Growth has also been strong in Construction, Transportation and Professional/ technical fields.

Airport passenger enplanements at Billings Logan International Field have not recovered from declines over the past three years from a peak in 2019.

The situation for other highly-populated areas of the state is varied.

GALLATIN COUNTY

Gallatin County has the state’s fastest growing economy, according to the BBER, noting that that growth is spreading across the county from Bozeman to impact Belgrade, Manhattan and Three Forks. Tourism has had a strong impact on the county’s economy, in more ways than one. While many of the businesses that serve the tourism industry have surged, many have been forced to limit their hours or expansion because of workforce issues. Not only is it difficult to find workers but the escalating cost of housing in Gallatin County makes it difficult for workers to be able to afford to live there.

Nevertheless, visitor spending is expected to remain strong in Gallatin County, which along with strong tech growth and its attraction for out-of-staters to relocate there, will continue to spur strong growth into coming years. While Gallatin County is attracting out-of-state migration, others are leaving the county to relocate in other Montana counties.

FLATHEAD COUNTY

Experiencing the second fastest growth in Montana is Flathead County, which in 2021 was almost as strong as Gallatin County. Driving the economy is visitor spending  and construction. The BBER forecasted 2023 growth at 1.9 percent in non-farm earnings. Housing prices cooled in Flathead County in 2022, and wages surged by 20 percent. Its basic industries are non-resident travel, manufacturing, health care and government.

Flathead County is projected to experience 1.9 percent growth in 2023.

MISSOULA COUNTY

Visitor spending was also important to strong growth for Missoula County, which has had “noticeable acceleration” in its economic growth over the past two years. Visitor spending has spurred the expansion of the motel and restaurant business segments in Missoula. The county also has growth in tech industries and in health care.

While not quite as robust as in Flathead and Gallatin Counties, construction has been strong in Missoula, where 2023 growth has been projected at 1.5 percent.

SILVER BOW

After three years of negative growth, Silver Bow County experienced positive growth of 5.5 percent in 2021. In 2022 growth was 0.6 percent. Such volatility for the county is not unknown, said economist Pat Barkey, because of its exposure to world commodity prices. Mining is the county’s most predominant industry. Like so much of the rest of the state, the county benefited from non-resident spending.

Positive growth is not projected to continue into 2023, according to Barkey, who projects negative growth of -0.7 percent.

CASCADE

Cascade County has “upshifted” into faster growth, according to the BBER. In 2021 its growth was 3.3 percent—the fastest growth since 2006. Its growth has been spurred by new building construction in both residential and commercial projects. A new medical school is one example. Great Falls is a trade center for the agricultural “Golden Triangle” area.

Government and federal military are Cascade County’s biggest industries because of the presence of the military base. Health care follows as the next important business segment.

While the growth in 2022 was 2.1 percent for Cascade County, projected growth for 2023 drops to 0.3 percent.

LEWIS & CLARK COUNTY

Lewis & Clark County has seen unprecedented growth in federal transfer payments related to federal transfer payments for pandemic stimulus programs. As those programs wound down, the county’s growth decelerated in 2021 but still came in at 2.7 percent in 2022.

This county too benefited by visitor spending and had an uptick in retail trade. Government and state government are at the top of the most prominent industries in the county. The county is projected to experience 0.5 percent growth in 2023.

From Center Square

21 February 2023
Dennis Pyburn
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Sixteen attorneys general – including Montana’s —are urging members of Congress to modify, clarify, and rescind an emergency-use authorization authority still being used by federal agencies to mandate coronavirus-related policies.

The letter sent to House Speaker Kevin McCarthy and House Committee on Energy & Commerce Chair Cathy McMorris Rogers, both Republicans, relates to curtailing the authority of the U.S. Department of Health and Human Services and Food and Drug Administration.

The AGs have requested that Congress override existing emergency-use authorization policies still in effect and to conduct rigorous oversight to establish what mistakes were made related to current and past implementation of the federal authority. They also asked Congress to “consider revising the liability protections provided by a prior Congress, and confirm what President [Joe] Biden has admitted and what the American people in their sound judgment know: any valid grounds for claiming a state of medical emergency due to COVID have ended; normalcy and the rule of law must be restored.”

Feds Consider Pulling Threatened Status of Grizzly

21 February 2023
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By Chris Woodward, The Center Square

U.S. Fish and Wildlife Service has accepted Montana’s petition to delist grizzly bears in the Northern Continental Divide Ecosystem. Governor Greg Gianforte petitioned the federal government to delist in December 2021. 

“After decades of work, the grizzly bear has more than recovered in the NCDE, which represents a conservation success,” said Gianforte in a press release. “As part of that conservation success, the federal government has accepted our petition to delist the grizzly in the NCDE, opening the door to state management of this iconic American species.”

The petition from Gianforte said NCDE grizzly bears are not only “within a distinct population” but have “far surpassed” population recovery goals. Gianforte also said that Montana Fish, Wildlife & Parks is capable of managing the bears. 

“FWP monitors grizzly bears in the NCDE with the best available science and a team of dedicated specialists,” said the governor’s office. “Although grizzly bears in the lower 48 states have remained under the jurisdiction of the U.S. Fish and Wildlife Service, much of the day-to-day management is done by FWP’s specialists who work with landowners and the public to address conflicts and increase safety and education in bear country.”

In 1975, grizzly bears were listed as threatened under the Endangered Species Act. The population of grizzly bears in the continental U.S. was then believed to be in the hundreds. Gianforte’s office said Friday the population in just the NCDE is approximately 1100.

Economically Speaking:

21 February 2023
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From the National Association of Manufacturers:

* The U.S. trade deficit rose from $61.02 billion in November, the lowest since September 2020, to $67.42 billion in December. The trade deficit was highly volatile in 2022, ranging from the low seen in November to the record high seen in March ($106.40 billion).

* These wild swings were the result of supply chain disruptions, slowing global growth, strength in the U.S. dollar and petroleum prices. The monthly trade deficit averaged a record $79.01 billion in 2022, up from $54.50 billion and $70.42 billion in 2020 and 2021, respectively.

* The increased trade deficit in December stemmed from a reduction in goods exports (down from $171.08 billion to $168.14 billion, a 10-month low) that corresponded with higher goods imports (up from $254.28 billion to $258.78 billion). As a result, the goods trade deficit rose from $83.20 billion to $90.64 billion.

* At the same time, the service-sector trade surplus increased from $22.18 billion to $23.22 billion, a three-year high.

* U.S.-manufactured goods exports totaled $1,292.03 billion in 2022, using non-seasonally adjusted data, soaring 13.84% from $1,134.97 billion in 2021. Likewise, manufactured goods imports grew 13.63% from $2,460.41 billion in 2021 to $2,795.82 billion in 2022.   

* The Index of Consumer Sentiment rose from 64.9 in January to 66.4 in February, a 13-month high, according to preliminary data from the University of Michigan and Thomson Reuters. Assessments of current conditions improved strongly, buoyed by labor market strength and slowing inflation data. Expectations of future conditions slipped a little in February, however.

* Overall, while Americans remain uncertain about geopolitical events and the economy, it is encouraging to see consumer confidence trend in the right direction, even as sentiment remains lower than preferred.

* U.S. consumer credit outstanding rose 2.9% at the annual rate in December, slowing from 8.4% in November. Revolving credit, which includes credit cards and other credit lines, grew 7.3% in December, easing from 15.6% growth in November but remaining a solid figure.

* Even with some deceleration in the latest month, Americans have continued to be willing to take on new debt, helping to buoy increased consumer spending. Indeed, U.S. consumer credit outstanding has increased 7.8% over the past 12 months, with revolving credit soaring 14.8% year-over-year.

After seeing disappointing industrial production and retail sales at the end of last year, the data this week should provide signs of whether activity bounced back in January, both with consumer spending and for manufacturing production. In addition, pricing data are expected to show some continued moderation for both consumers and producers.

Dead Rats

21 February 2023
Evelyn Pyburn
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By Evelyn Pyburn

Billings representative, Katie Zolnikov has introduced House Bill 337, which would prohibit local governments from requiring minimum residential lot sizes. Zolnikov’s aim is to open the door to the development of more affordable housing.

Such legislation would be unnecessary if private property rights were adhered to by a power-crazed bureaucracy.

The fact is about half the legislation we see would be unnecessary if private property rights were adhered to by both governments and citizens. If only “leaders” would trust to the market when it comes to determining what consumers or homeowners want!

The decline in respect for private property is an ominous trend, since liberty depends upon individuals being able to own and use property. Government in the US was intended to own only a scant necessity of property as needed to facilitate what it was supposed to do, and infringing upon private property required compensation.

Property owners should be compensated because the USE of property is its value. When you purchase property you are really purchasing the right to determine how to use it. The more you can do with a parcel, the greater its demand and the greater its value. When you rent it the renter purchases a portion of the right to use it in a specific way for a specific time. When city hall, the county, state or federal government usurp part of your ability to use it, there is a takings (theft) and the owner should be compensated for the loss.

Of course, such a system would greatly diminish the eagerness of bureaucrats to dictate how private individuals may use their property.

Years ago as planners and czars were ratcheting up their power over how people could build homes, ostensibly for “health and safety”, there were those who warned that this day would come – the  day, when the market would not function and there would not be enough housing, and what there would be would be inordinately expensive.

Back then – in the ‘70s —  I was told that they needed  to control the size of residential lots because they had done studies on rats and determined that when rats lived in crowded conditions, rats died. They didn’t want us all dying like rats, they said. Really! this is true! It was what a somber, sober and ostensibly wise bureaucrat told me.

Of course that was the policy that created urban sprawl, which today the autocrats hate and are dedicated to eradicating with the implementation of a different set of coercive regulations telling people what to do with their property. The point is, of course, that while they assert that they have all the answers, even their own history says they do not.

There is nothing wrong within our economy regarding housing that a free market wouldn’t take care of so rapidly that market glitches would be corrected before we even noticed them. That the housing market is so crippled screams to the high heavens that housing is not functioning in a free market. Any time there are market distortions, look closely, it is always because of government controls.

Believe it or not there was a time when people built homes with no government oversight – many of those homes are the beautiful homes in historic districts that everyone now wants to save and  which usually hold premium prices even though they are a century old. How is that possible?

As far as guaranteeing the integrity of a building?  On my Grandfather’s ranch when they went to demolish the house that was built during the Homestead era, it proved to be so soundly and tightly built with hand hewn logs – with no guidance from “experts” —  that when they tried to remove it they could not pull it down with the farm tractors. They had to burn it down. Again, how is that possible without building codes and inspectors?

A property owner should be able to build whatever kind of house they want on property they own, so long as it poses no physical danger or damage to others. If it’s a poorly built house it will have no value to potential future buyers and banks won’t accept it as collateral. People have every incentive to build quality structures and the market will deal quite ruthlessly with those who don’t.

The color or size of a house isn’t anyone’s business but the property owner’s. It shouldn’t matter what space they have in front of the house or whether the garage is in front or back. The property owner should be able to place a basketball hoop where they want or put up whatever kind of fence they want. This is how property rights work.

If a prospective homeowner wants protection against what neighbors might do, they buy property in a development that has covenants restricting use and construction – which would be something they CHOOSE to accept.

While much attention is being given to lot sizes and prohibitions against multi-family units, there are also hundreds of regulations dictating how people should build, dictates that impose extraordinary costs while eliminating no risks. Some years ago, there was a report that concluded that unnecessary regulations imposed $40,000 on a typical new house in Montana. And – they said Montana was one of the worst states for imposing costly and overly restrictive regulations.

Some cities restrict colors one can paint a house, whether gardens are permissible, or how high the fence can be. Good grief, we had planners who were consternated about how wide a garage door should be or whether a property owner could build an apartment over their garage. In Billings, in order to appease someone else’s sense of esthetics, ordinances force property owners to place garages in the alley. What business is it of theirs, especially when you know the last thing you are going to see after a two-foot snowstorm is a city snow plow?

Regulations on property use have much broader impacts than just cost. Decades ago it was  common for people – especially the elderly – to rent out a room in their home – quite often to students – which was not only more affordable but helped older home owners to afford to stay in their homes. It also provided social interaction for older people, who otherwise might live very solitary lives, and it created a degree of security for both the landlords and tenants. This, too, was made illegal as municipalities policed the use of private property. But again, the “experts” in some communities have changed their views and are allowing “mother – in-law” apartments – not so much because of broader social and economic benefits but because it addresses their earlier mistakes in creating urban sprawl.

However, current policies still continue to create urban sprawl, as was revealed during community discussions last year by builders who said they don’t want to build within the city and many people don’t want to live within the city, because of violations of private property rights.  They “sprawl” into the country side.

One could go on and on explaining the ridiculousness of housing regulations and  the real things that happen, which not only impose costs on homebuilders but cripple housing availability.  Just strike up a conversation with a builder and they will readily tell you. If you listen to them you will be doing more than most municipal leaders.

Bear in mind the builders, engineers and architects tend to keep mum about building conflicts and ineffectual regulations, because as one architect pointed out to me some years ago, the building department and city hall control most aspects of their professions and if they want to stay in business they better keep their mouths shut and heads down.

So while House Bill 337 is certainly welcome, our right to own and use property already covers the violations it addresses, and while the bill may be of some help, housing will remain unaffordable and increasingly limited, until the housing market becomes free, and property owners can determine for themselves what they want. What we really need is the reinstitution of private property rights.

Building Permits February 15, 2023

21 February 2023
Press Room
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Commercial

CommercialCity Of Billings (Airport)/ Monarch Limited Of Montana, 2390 Overlook Dr, Com New Other, $2,550,000

 Girls Scouts Of Montana & Wyomimg/ Construct One, 2303 Grand Ave, Com New Other, $175,000

 Gen 7 Construction LLC/ Collishaw Marital Trust, 1142 S 29th St W, Com New Other, $410,807

 Rob Veltkamp/ Gen 7 Construction LLC, 1146 S 29th St W, Com New Other, $410,807

 Robin L Morton Trust/ T.W. Clark Construction LLC, 2220 Grant Rd, Com Remodel, $815,000

 City Of Billings (Airport)/ Morgan Contractors Inc, 1901 Terminal Cir, Com Remodel $350,000

Kathy Bolin/ Laughlin Construction Inc,.2701 1st Ave N, Com Remodel, $150,000.

Town And Country Supply Association/ Millennium Construction &

Consulting Inc, 523 Hilltop Rd, Demolition Permit Commercial, $30,000

City Of Billings The, 260 Stewart Park Rd, Com Footing/Foundation, $20,000

 Ross Development LLC/ Beartooth Holding & Construction, 1302 Golden Valley Cir, Com Remodel, $360,000

 Jon Lorash/ Bauer Construction, 1611 Zimmerman Trl, Com Remodel, $640,800

 Christ The King Evangelical Lu/. 752 Calhoun Ln, Com Remodel, $20,000

Collishaw Marital Trust/ Gen 7 Construction LLC, 1144 S 29th St W. Com New Other. $410,807

 Amber Hirschi, 1423 38th St W, Com Remodel, $150,000

 Jeremy Freyenhagen/ Wegner Homes, 1343 Broadwater Ave, Com Remodel, $59,362

 Daniel Harris/ Hardy Construction Co., 1233 N 30th St, Com Remodel, $40,000

 Daniel Harris/ Hardy Construction Co., 1233 N 30th St, Com Remodel, $300,000

 Players Club Inc/ Hardy Construction Co., 247 Main St, Com Remodel, $500

Rommesmo Family Limited Partnership/ Marketing Specialties, Inc., 1501 S 30th St W, Com Addition, $50,000

 VTR Properties Llc/ Reichenbach Construction Inc, 2615 4th Ave S, Com Addition, $947,000

 School District #2/ Empire Roofing Inc, 221 29th St W, Com Fence/Roof/Siding, $265,242

 School District No 2/ Empire Roofing Inc, 1315 Lewis Ave, Com Fence/Roof/Siding, $408,758

 Erving Properties Llc/ G & L Enterprizes Inc, 19 S 28th St, Com Fence/Roof/Siding, $3,722

2316 First Ave North Llc/    T.W. Clark Construction Llc, 2310 1st Ave N, Com New Other, $11,000,000

 Bfwy Real Estate Holdings, Llc/ T.W. Clark Construction Llc, 1509 Rehberg Ln, Com New Restaurant/Casino/Bar, $1,000,000

 Atc For Dish Wireless, 526 Bernard St, Com Remodel, $50,000

 Morledge-Hampton Family Llc/ Langlas & Assoc., Inc., 1704 Poly Dr, Com Remodel, $20,000

 Albert Gilbert/ Neumann Construction, 2860 Grand Ave, Com Remodel, $92,000

 Sisters Of Charith Of Leavenwortyh/ Hardy Construction Co., 1233 N 30th St, Com Remodel, $350,000

Residential

Mccall Development Inc/ Mccall Development, 6105 Elysian Rd, Res New Single aFamily, $155,302

Mike Christensen/ Michael Christensen Homes, 2514 Buffalo Ridge Trl, Res New Single Family, $450,000

Mike Christensen/ Michael Christensen Homes, 2510 Buffalo Ridge Trl, Res New Single Family, $450,000

 McCall Development/ McCall Development, 6188 Johanns Meadow Ln, Res New Single Family, $291,509

 Billings Home Run LLC/ ABCO Billings LLC, 5744 W Mets Way, Res New Two Family, $125,040

 Billings Home Run LLC/ ABCO Billings LLC, 5738 W Mets Way, Res New Two Family, $125,040

South Pine Design/ South Pine Design, 5314 N Iron Mountain Rd, Res New Single Family, $450,000

 Infinity Homes/ Infinity Home LLC, 7052 Copper View Way, Res New Single Family, $300,031

“Rich-cession” Looms in 2023

21 February 2023
Press Room
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While Montana’s economy has been doing quite well over the past couple ofyears, economists are projecting changing winds in 2023.

During the recent Economic Outlook Seminar, Bureau of Business and Economic Research Economist Pat Barkey said that while Montana’s economy grew by over two percent in 2022 it is likely to plummet to zero in 2023 and perhaps even dip into negative territory of  -1.1 percent. 

Barkey said that whether there will be a recession is uncertain. He noted, “A recession was supposed to be here last year.” A recession is still more likely than not – at the very least, the state’s economy will slow significantly, he said. Whatever the next year brings, “it will be a lot different than a year ago.”

In fact, Barkey explained that “There’s something called the Fed recession in our future. It’s been engineered, it’s there, it’s something the Fed is trying to do, or might do.”

While some aspects of inflation have slowed, there remains the likelihood of higher interest rates and diminished investments.

The impact of a recession could be lessened for Montana should the in-migration from other states continue, bringing with them more spending and wealth to the state. It was reiterated several times that the new comers to Montana are good for the state because they are bringing new wealth and spend money.

Barkey said he calls the likely downturn the “rich-cession” because it has had a bigger impact on higher income people than lower income. That is due in large part because of the huge demand for labor.

While not all the numbers are in, overall 2022 appears to have been a very good year for Montana, continuing the economic surge the state experienced in 2021. Statewide average growth was over 5.3 percent in 2021 – the highest it had been since 2006.

According to BBER, 2021 growth was well above average in Flathead, Gallatin and Missoula Counties, driven by the reopening of the economy after the pandemic. The one exception in the state was counties in the eastern portion of the state that are dependent upon the oil and gas industry, which has struggled given that political winds directed investment away from it.

Most of Montana’s economic activity and growth happens in its seven population centers – only 10 percent of state growth occurred outside the seven largest counties.

Perhaps, much to some people’s surprise, Barkey said that mining is Montana’s and Yellowstone County’s most prominent industry.

Barkey expressed some dissatisfaction for the decisions of the Federal Reserve because they were slow in raising interest rates – “they were asleep,” he said. Raising interest rates sooner would have slowed consumer spending sooner, which is what is driving the US economy and needs to be “moderated”.

”We are starting to run out of fuel for consumer spending,” he said, noting that consumers are running out of savings and starting to rack up charges on their credit cards.

“The economy is healing but not healed.”

Inflation is starting to ease a bit – lumber prices have come back down, commodity prices have “settled down”, big ticket consumer purchases are expected to decline in price 4 percent —“all prices are softening.” “Supply chain congestion is better than a year ago.”

While housing prices increased 52 percent statewide since 2020, creating affordability issues for many people, they have weakened somewhat but home sales have slowed.  As interest rates increase home sales will continue to be slow.

Nevertheless, the construction industry has continued to be strong and may become stronger as material prices decline.

A real concern is energy prices, which have come down somewhat but are “still 42 percent higher since the pandemic.” Barkey was critical of President Biden’s policies which have discouraged investors to invest in oil and gas, which has kept the industry down and gas prices high. That industry’s struggles has been very detrimental to Montana, and to Yellowstone County other eastern Montana counties.

Since the economic impacts of COVID mandates,Montana’s health care industry has had significant struggles dealing with labor shortages and rising costs. It is expected to ease in 2023, however.

Lower consumer prices will ease pressure on the labor market. “We need less demand for workers; those pressures are pushing up costs,” said Barkey, but he also pointed out that the labor shortage was materializing before the pandemic. “The workers are there – they are working – the problem is we need more of them.”

There has been a seven percent increase in wages – but that is not more than the rate of inflation.

“Wages ae not so fat and happy as you think.”

The strength of Montana’s economy over the past couple years is evidenced in income tax collections in the state. They still show double digit growth, but “beware of any forecasting,” warned Barkey, “No one knows where you are until we go through April” – and can see tax returns.

“Last year’s 2 percent growth is amazing.” but Barkey’s forecast for 2023 will see a “slamming on the brakes” for the state.

Montana’s economy may not be as dependent upon performance as it is dependent upon the “fragile” world economy.

Barkey provided predictions from HIS Markit:

—While 2023 may see a recession it will also see the beginning of a recovery from recession which will gain momentum in 2024.

—economic weakness is expected in several segments with residential investment leading the way.

—the price of US farm output, currently more than double its pandemic low, which remain elevated through 2022 will ease as crops come in in 2023.

—slowing growth will cause oil prices to ease to $84.

—consumer spending will grow modestly through 2024, constrained by a rebound in personal savings rate from the unsustainable lows below 3 percent. Fixed income will decline to 4.1 percent in 2023 with weakness concentrated in construction, both residential and nonresidential.

—labor markets will remain tight but the trend in payroll gains is slowing.

—the fed will raise its policy rate by March to the range of 4.75 percent to five percent and allow its balance sheet to decline by about one-third through 2024.

—inflation will decline in three steps. Already underway are declines in the prices of energy and agricultural commodities that are allowing headline inflation to fall quickly below core inflation. In a second step there will be easing in supply-chain tensions, or decline in the pries of certain core goods; such as vehicles, fist used and then new. In step thee, a recession eventually tempers inflation pressures emanating from labor markets.

—a risk exists that a resilient economy remains strong for longer than previously anticipated, requiring a more aggressive and persistent monetary tightening (higher interest rates) to contain inflation which would precipitate a later and more severe recession.