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Letter to the Editor – Nash

9 November 2020
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I was thinking about the Dem plan to increase taxes on corporations (you know, the evil corporations) while not increasing taxes on the middle class. So I looked it up. Here’s what I found from the Congressional Research Service document (fas.org) “Pass-Throughs, Corporations, and Small Businesses: A Look at Firm Size” March 15, 2018. Using stats from an analysis of US census data from 2015, the report shows that “…73% of corporations… had fewer than 10 employees; 85% of corporations… had fewer than 20 employees; 97% of corporations had fewer than 100 employees…” so when voters rub their hands together about sticking it to corporations, just realize they might be your neighbors, your valued community cause supporters, the creators of services and buy-local goods you count on every day.  They and their employees are likely the middle class.

Deborah Nash

Manhattan, Montana

Court Allows States to Waive SNAP Regulations

9 November 2020
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The Center Square

The U.S. District Court for the District of Columbia has blocked a Trump administration change to the Supplemental Nutrition Assistance Program (SNAP) that could have removed eligibility for almost 700,000 unemployed, able-bodied Americans.

A lawsuit filed in January by a multistate coalition alleged a U.S. Department of Agriculture (USDA) rule wrongly reversed a decades-old policy that allowed states to waive SNAP work requirements. The previous rules granted waivers for larger geographic areas by lumping certain regions with lower unemployment with locations registering higher unemployment, as well as carryover unused exemptions.

To increase workforce participation, Congress in 1996 amended SNAP benefits to limit disbursements to “Able-Bodied Adults Without Dependents” (ABAWD), defined as unemployed individuals ages 18-49 who are not disabled or raising minors. SNAP funds were restricted to three months within three years unless subjects are employed for a minimum of 20 hours per week.

But the law granted states the ability to request waivers for that time limit if the state or part of the state had an unemployment rate above 10%, or did not have a sufficient number of jobs to employ SNAP recipients.

The new rule attempted to revise state discretion for waivers due to economic conditions, define geographic scope waivers, and require the state to rely on the entire population’s unemployment instead of employment for ABAWD.

Critics of the geographic waiver requirements point out that past regulations required the USDA to average different regional unemployment rates so more people receive the waiver, even in regions that are below the unemployment benchmark.

“Geographic-area waivers of work requirements for people who receive food stamps are based on the flawed premise that when the unemployment rate in a given area exceeds a certain level, even in a national economic boom, able-bodied people in that area should not be expected to look for work, whether in that area or in a neighboring city or county,” Jamie Hall, a senior policy analyst in empirical studies at The Heritage Foundation, said.

Hall said that ABAWD work requirement exemptions by geographic waivers account for about double the SNAP caseload expected.

“Geographic waivers are not needed to protect vulnerable citizens’ access to food. Other provisions exist or are available to give states the flexibility they need to provide exemptions from the work requirement for people facing difficulties,” Hall said.

Chief Judge Beryl Howell noted “the backdrop of the pandemic has provided, in stark relief, [the] procedural and substantive flaws” of the rule change.

Within two months of the start of the pandemic, more than 6 million Americans enrolled in SNAP.

The court observed USDA was “silent” on how many of enrollees wouldn’t be eligible for SNAP benefits as a result of USDA’s proposal.

The Administrative Procedure Act requires agencies to offer explanations for changing long-held policies, but the court found the waiver changes were “arbitrary and capricious.”

“SNAP was specifically created to help Americans struggling with food insecurity and as we continue to navigate this pandemic, this assistance is more important than ever,” Michigan Attorney General Dana Nessel said in a statement.

“Instead of helping Americans at a time when so many are facing hardships, the Trump administration chose to cruelly revoke vital food assistance that thousands of Michigan residents rely on. This is an important victory in favor of human decency.”

During the COVID-19 pandemic, Michigan’s SNAP rolls surged $126 million from February to May.

The federal government pays the full cost of SNAP benefits but splits administration costs evenly with the states.

The court ruled that USDA’s change violated the federal rulemaking process, and vacated the rule in its entirety.

City of Billings Approves TEDD Agreement

6 November 2020
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With two dissenting votes, the Billings City Council approved, on Monday, an amendment to the agreement the city has with Lockwood Water and Sewer District (LWSD) that paves the way for the LWSD to expand its sewer district boundaries to provide service to property owners in the TEDD in Lockwood. The amendment allows the expansion without requiring the property owners to sign waivers to protest any future annexation proposals, which became a point of contention over a year ago.

The agreement imposes an 18 percent surcharge for the property owners of the TEDD (Targeted Economic Development District) for any treatment of sewage they get from the city, and makes clear that the agreement in no way impacts negotiations for any future need for water that Lockwood might have. It was also accompanied by a letter from Yellowstone County Commissioners committing themselves to cooperation with the City of Billings in planning future land use restrictions at the city boundaries, said City Administrator Chris Kukulski.

The action paves the way for the development of the TEDD in the most environmentally desirable manner possible, as an industrial park which it is hoped will entice new businesses to the area. That Billings providing sewage treatment is the most desirable way for development to happen — which is sure to happen with or without the agreement — was mentioned as a significant reason for their supportive vote by some of the council members, while others in opposition said they believed that the city was being short changed, since the 18 percent surcharge will generate only $24,000 annually in extra revenue, according to Kukulski. City staff said that the justification for the surcharge is for the additional risk the city faces in meeting regulatory requirements of the Department of Environmental Quality.

LWSD Manager, Mike Ariztia, explained that the next steps involve getting approval of the LWSD board, which earlier rejected a draft proposal because of changes it made to the basic contract they have had with the city for the past 12 years. Ariztia noted that the board had questioned why the issue of future water supplies should be included in an agreement about sewage. LWSD functions as two districts – -a sewer district and a water district. Kukulski said that he thought that mention of it was important because in the past there seemed to be people who believed that promises had been made about future agreements that were not written down. He wants to make sure that no such confusion exists in the future.

Ariztia further explained that once the LWSD board accepted the amendment, a process would be initiated to legally include, within its boundaries, the area which was analyzed for the establishment of the TEDD, which would include properties that are not currently part of the TEDD but could be in the future. That process requires the approval of a majority of the TEDD property owners and the acceptance of the LWSD board.

The agreement with the city also reduces by half, a million dollar bond that the city required of LWSD 12 year ago when they entered into their agreement to guarantee performance. Kukulski said that he believed that the district has demonstrated their viability and the reduction is appropriate.

Melissa Yackley Promoted to VP Stockman Bank

22 October 2020
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Melissa Yackley has been promoted to Vice President, Branch Manager of Stockman Bank King Avenue. Her responsibilities include overseeing bank operations, management and employee supervision, and all lending activities.

Yackley brings over 15 years of banking experience to the position, which includes commercial lending and business development. She was previously vice president, commercial loan officer at the Stockman Bank King Avenue office. 

Yackley earned her Bachelor of Science degree in Business Administration and Management from the University of North Dakota in Grand Forks, North Dakota. She is active in the community serving on the Board of Directors for the Alberta Bair Theater and Family Services, as well as a member of the Billings Kiwanis Club.

She is located at 2700 King Avenue and can be reached at (406) 655-2728.

Yackley takes over for Tim Ludewig who was the previous branch manager of Stockman Bank King Avenue. Ludewig recently relocated to Missoula to serve as vice president, commercial lender for the Stockman Bank Missoula market.

US Not so Competitive When It Comes to Taxes

22 October 2020
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The Tax Foundation has released the latest edition of its International Tax Competitiveness Inc. which shows that the US ranks only 21st in the developed world for tax competitiveness.

A well-structured tax code is easy for taxpayers to comply with and can promote economic development while raising sufficient revenue for a government’s priorities. In contrast, poorly structured tax systems can be costly, distort economic decision-making, and harm domestic economies, explains the Foundation. 

While the U.S. tax system has become more competitive in recent years, it still ranks in the bottom half of developed countries and behind what are often considered high-tax countries like Sweden (#7) and regional competitors like Canada (#18) due to several uncompetitive features:

* A progressive individual income tax with a top rate of 46 percent, including payroll and personal income taxes.

* A partial territorial system that doesn’t exempt foreign capital gains income (one of the most onerous international tax systems of any OECD nation).

* Among the strengths of the U.S. tax system is the allowance of full expensing for business investments in machinery; however, that is set to expire soon.

Unfunded Retirement Systems Will Cost

22 October 2020
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The Center Square

Only one in five of the 143 largest statewide public retirement systems in the U.S. are resilient, a new analysis published by the bipartisan nonprofit Equable Institute shows.

Public sector funding peaked in 2001, with nearly 3 out of 4 statewide plans 90 percent funded or better. By 2020, one in five statewide plans have a “resilient funded” status.

[Montana’s retirement funds for teachers and for public employees face a $4.5 billion shortfall, according to legislators serving on a special committee that met last January to discuss the problem in Billings. The Montana Teachers Retirement System (MTRS) and the Montana Public Employees Retirement System (MPERS) have reached this state of affairs primarily because of overestimating the rate of returns on the state investment fund from which future retirement benefits are paid. They said that they expect that the problem will have to be addressed during the next state legislative session.]

The report, “State of Pensions 2020,” analyzes trends in public pension funding, investments, contributions, cash flow and maturation of retirement systems that had more than $1 billion in assets through 2019.

The current estimated funded ratio for 143 statewide plans is 67.9 percent, near the lowest point in modern history. And five states – California, Illinois, New Jersey, Pennsylvania and Texas – account for more than 50 percent of unfunded liabilities.

The institute, which works with public retirement system stakeholders to solve complex pension funding challenges, found that nationally, public pension funding has been in decline since 2001. Despite the decade-long bull market, the recession following coronavirus shutdowns leave them in a worse position than the Great Recession did.

State and local public employee retirement systems in the U.S. manage over $4.3 trillion in public pension fund investments, according to Pew Charitable Trusts. Returns on these assets account for more than 60 cents of every dollar available to pay promised benefits, it found in a December 2019 report.

“About three-quarters of these assets are held in what are often called risky assets – stocks and alternative investments, including private equities, hedge funds, real estate, and commodities,” the Pew report said.

Research by The Pew Charitable Trusts found that since the Great Recession, public pension plans have lowered return targets in response to changes in the long-term outlook for financial markets. Pew analyzed the 73 largest state-sponsored pension funds, which collectively manage 95 percent of all investments for state retirement systems. The average assumed return for these funds was 7.3 percent in 2017, Pew found, down from over 7.5 percent in 2016 and 8 percent in 2007 just before the downturn began.

“The pension asset shortfall for statewide plans keeps growing,” the Equable Institute report states. “At the end of 2019, there was no net recovery from losses during the Great Recession and Financial Crisis.”

The institute estimates that unfunded liabilities will grow to $1.62 trillion in 2020, up from $1.35 trillion in 2019, and from $1.16 trillion in 2009.

“One of the most concerning findings from the report is a trend toward rapidly expanding net negative cashflows, as a result of plan maturation,” the report states.

“Although contribution rates have progressively increased (a positive trend from the perspective of plan funding), benefit payments are also growing steadily (because of increased retirements), resulting in a net negative cashflow of -$113 billion for 2019,” it continues.

Because the trend has steadily worsened since 2009, the institute says it will be increasingly difficult for governments to invest their pension plans back to health.

If assumed returns had kept pace with declining interest rates since 2001, the institute analysis says, average assumption in 2019 would have been around 5.1 percent. In 2020, the average assumed rate of return is 7.2 percent.

“We estimate the average investment return for statewide plans as of June 30, 2020 is -0.44 percent based on the most recent asset allocation reports from each plan,” the institute says. “This is 763 basis points below the average 7.19 percent assumed return for the fiscal year.”

The report also analyzed unfunded liabilities relative to state GDP and found that states with some of the most visible pension funding challenges, including New Jersey, Kentucky and Illinois, have the largest share of unfunded liabilities relative to their state’s GDP, topping 15 percent, respectively.

Supreme Court Halts 2020 Census

22 October 2020
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The Center Square

The U.S. Supreme Court on Oct. 13 stopped the 2020 Census head count in response to a request from the Trump administration, handing a blow to a coalition of local governments and civil rights groups that filed suit.

The coalition sued to stop the census count from ending Sept. 30, which the Trump administration had planned in order to meet a deadline stipulated by law. U.S. District Judge Lucy Koh ruled that the count could continue through Oct. 31, which the Trump administration appealed to the U.S. Supreme Court and won.

The administration argued the count needed to end immediately in order for the U.S. Census Bureau to have enough time to tally the numbers before a congressionally mandated Dec. 31 deadline. Counting and compiling all the data is necessary to accurately determine the number of congressional seats apportioned to each state based on population totals.

The U.S. Census Bureau argued before the court that it had already counted 99.9 percent of households in the U.S. in 2020. But census takers have raised concerns about the quality of the data being collected, and the American Statistical Association released a report Tuesday expressing similar concerns.

Their report, written by a task force of former Census Bureau directors and others, raises concerns about the shortened head count schedule, pending lawsuits and other issues. The task forces argues that outside experts should be given access to the data to help analyze its quality before it is used to determine congressional seats. They also recommended that federal law governing the census be reevaluated.

Results of the door-knocking phase of the 2020 census this year are similar to those received from the 2010 Census, Al Fontenot, an associate director at the Census Bureau, said in court papers. Nearly 24 percent of responses resulted from interviews with neighbors or landlords or someone other than the person living in the household that was being counted in both 2020 and 2010.

The 2020 Census, Fontenot said, is the first decennial census in which records from the IRS, Social Security and Medicare accounted for 13.9 percent of the information the Bureau collected about residents instead of receiving the information directly from them.

In addition to apportioning congressional seats, the population data calculated by the Census Bureau also determines how much of $1.5 trillion in federal money is allocated to states.

State Sells Bonds for Infrastructure

22 October 2020
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The state of Montana sold $52.2 million in bonds to continue financing infrastructure projects across the state and refinanced $32.4 million in bonds to take advantage of lower interest rates, which will save taxpayer dollars.

The Board of Examiners executed the Bond Purchase Agreement. The bonds sold will continue financing projects such as Romney Hall, expansion of the Great Falls College MSU Dental Hygiene Clinic, and the Montana Heritage Center.

Interest rates for the bond issuances were historically low and ranged between .7 percent to 1.8 percent.

Additionally, the Board of Examiners approved refinancing $32.4 million in trust land bonds as well as water pollution control bonds. Refinancing will save the state $7 million.

The Montana Legislature passed and Governor Bullock signed legislation in 2019 to fund sewer, water, bridges, buildings and other public works projects.

On a Whim: AAA Montana Reveals Last-Minute Travel Trends

22 October 2020
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Travelers who are comfortable taking a trip are making those plans at the last minute

As travelers begin to hit the roads again, many are making travel plans on a whim.

According to AAA.com hotel booking data, domestic travel bookings show September was the strongest month of the year, but still down 12% compared to 2019. AAA Montana travel data also reveals:

* 49% of hotel bookings are within three days of travel, up from 31% in 2019.

* 65% of hotel bookings are within seven days of departure, up from 45% in 2019.

“Travel destinations around the world have made enhancements to their operations with safety in mind,” Aldo Vazquez, spokesperson for AAA Montana, said. “Would-be travelers should work with a travel professional who can help them research their destination to help determine their level of comfort before booking.”

Shorter, closer trips to home appear to be the new trend as travelers determine for themselves what they are comfortable doing when venturing from home.

These are the top hotel destinations according to data from AAA Montana through September.

1. Las Vegas, NV            

2. San Diego, CA

3. Reno, NV

4. Flagstaff,  AZ             9

5. Sacramento, CA       

6. San Francisco, CA

7. Los Angeles, CA

8. Phoenix, AZ

9. Monterey, CA

10. Salt Lake City, UT

*This list includes data from a seven state region including Northern California, Nevada, Utah, Arizona, Montana, Wyoming and Alaska.

AAA’s TripTik travel tool provides COVID-19 travel restrictions, including roadway checkpoints, border closures and confirmed cases at the state and county level. Travelers looking for hotel destinations can visit AAA.com/Hotels to search for lodgings with AAA’s Best of Housekeeping and Diamond designations.

 About AAA Montana AAA  is on a mission to create Members for life by unleashing the innovative spirit of 4,000 employees representing more than 6 million Members across Northern California, Arizona, Utah, Nevada, Montana, Wyoming and Alaska. In addition to legendary roadside assistance, AAA offers home, auto and life insurance, travel, and home security service

MSUB Focuses Search on Stefani Hicswa

22 October 2020
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The MSU Billings Chancellor Search Committee has announced Stefani Hicswa, Ph.D., as the sole finalist for the MSUB Chancellor position. Hicswa currently serves as President of Northwest College in Powell, WY; a position she has held since 2013. Under her leadership, Northwest College has achieved the highest completion rate in its history, completed significant capital projects, and launched comprehensive strategic visioning, enrollment management, and facilities master plans. Prior to her service as President of Northwest College, she served for seven years as President of Miles Community College in Miles City, Montana.

“Stefani Hicswa is an outstanding finalist for this position,” said Deputy Commissioner of Higher Education Brock Tessman, who serves as chair of the Chancellor Search Advisory Committee. “She brings to the table a proven track record of stable and successful executive leadership, strong connections to Montana higher education, and a passion for connecting with students, employees, and the community.”

Hicswa holds a Ph.D. in Educational Administration from the University of Texas at Austin, a M.Ed. in Adult, Community, and Higher Education from Montana State University Bozeman, and a B.A. in Organizational Communication from the University of Montana Missoula. She is deeply familiar with the higher education landscape in Montana, including her time as President of Miles Community College, work as a consultant to Helena College, Flathead Valley Community College, Miles Community College, and Great Falls College, and a term as the Lincoln County Campus Director for Flathead Valley Community College. She has also held leadership positions with the Flathead Valley Community College TRIO and Upward Bound programs. Beyond Montana, she has faculty experience with the University of Wyoming, National American University, and the University of Illinois.