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Stephens Unveils Plan To Meet Court's Finance Mandate

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Montana's governor last week unveiled his latest proposal for complying with the state supreme court's mandate for the development of a new school-finance system.

Gov. Stanley Stephens' plan, however, was quickly labeled "dead on arrival" by the head of the state's largest teachers' union.

The Republican governor's plan "doesn't come anywhere near the equity mandated by the supreme court," said Eric Feaver, president of the Montana Education Association.

But there is "no evidence" that Democrats in the legislature "have anything up their sleeve either," Mr. Feaver added, suggesting it is likely that state policymakers will miss the high court's July 1 deadline.

The legislature failed to reach an agreement on a new finance system in the regular session that ended in April. Lawmakers will return to Helena on June 19 for a special session devoted solely to the issue.

Governor's Proposals

Mr. Stephens said his plan to equalize spending among school districts is "structured to meet the court's mandate with or without new sources of revenue."

Under his proposal, state aid to schools would be increased by $224 million, raising the state's share of districts' costs from under 60 percent to 85 percent.

About $44 million would come from replacing the current 45-mill mandatory statewide property tax and 10-mill permissive levy with a uniform 85-mill tax.

In addition, the state would take 80 percent, or about $60 million, of the tax revenues now collected locally on "major classes of property" such as power plants, oil-field developments, and railroads and redistribute them to districts on an equalized basis.

The Governor also reiterated his support for a new 3 percent state sales tax, which would raise $120 million; the inclusion of payments for teacher retirement and insurance in the foundation program; and the imposition of spending limits in the state's more affluent districts.

The sales-tax proposal would be linked to bills to provide $25 million in residential property-tax relief and $35 million in income-tax reductions.

Governor Stephens also said he would release the details of a $6-million school accountability program at a later date.

Mr. Stephens plans to hold meetings in coming weeks with various interest groups to discuss his proposals and any others being developed for consideration in the upcoming session, said Victor Bjornberg, his press secretary.

In a prepared statement, the Governor said he "remain[s] open to new ideas, suggestions, and different proposals as we approach this critical special session."

Mr. Feaver of the mea said the Governor's plan is "deficient in design and deficient in attitude."

If it is adopted, he warned, the "high-spending districts would come to look like the low-spending districts."--jw

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