Ochenkski: Breaking point

Searching for leaders as costs spiral higher



Those Montanans who own property—a house, for instance—are reeling in shock this week after receiving their latest property tax assessments. In most places, the increase was a whopping 20 percent. The news is equally bad for renters, who will experience their own shock as the increase gets passed through to them and their rents go up. Add to this the recent huge electric and gas rate increases—to somehow be paid with our bottom-of-the-heap wages—and it’s just possible that Montana is now reaching the economic breaking point for many families. The question is: What are we going to do about it?

Let’s start with the utilities. The electric rate increase, which took effect this week, will hammer every citizen and business in the state that formerly relied on the Montana Power Company for electricity. A recent utility rate survey, done by the Great Falls Tribune, is shocking in its implications. Whereas only a few short years ago Montana had the sixth-lowest electricity rates in the nation, we are now being charged at nearly the highest rates in our region.

What’s dismaying about the higher rates is that, for almost a century, one of Montana’s main attractions for new businesses interested in locating here was our low-cost electricity. Sure, we still had a huge transportation radius for shipping materials and goods in or out, but the low-cost electricity helped offset that obvious drawback to locating in Montana. But that’s now gone, thanks to the absolute disaster of electricity deregulation that brilliant political leaders like Sen. Fred Thomas (R-Stevensville), the dereg bill’s sponsor, enacted in 1997. Since Montana produces nearly twice the amount of electricity that we consume, it’s clear these prices are not being driven higher by supply and demand. Even more dismaying is the fact that electricity rates have flattened out or declined for consumers in the other states in our region—but not for us.

Added to the new, higher electricity costs are the enormous recent increases in the rates for natural gas, which total 70 percent in the last seven months alone. While corporate pirates blame the increase on a “shortage” of natural gas, the reality is that the proposed natural gas electrical generation plants in Montana would have doubled the state’s total natural gas consumption to produce electricity we neither need nor have the transmission capacity to ship out of state. That some of those plants were mothballed before they even went into production should have eased, not exacerbated, the projected demand for natural gas.

The result of these huge utility increases is a vicious triple whammy for Montana. First, sky-high rates in a Northern Tier state, where winter is a reality, not just a season, provide a huge disincentive for new businesses to locate here. Second, every extra dollar that Montanans have to squeeze out of their extremely low wages and send to out-of-state utility companies means there will be that much less they can afford to spend on our existing businesses. From farm and ranch stores to local restaurants, Montana businesses and citizens will simply have less disposable income thanks to the higher utility rates.

But that’s not where the nightmare ends.

Remember those 20 percent re-appraisal increases? Thanks to the impact that the higher utility rates will have on state and local governments and educational institutions, their bills will also go up and up and up. And where will they get the money to pay them? Why, they’ll get it from the same place government always gets its money—from the taxpayers. Applying the same (or higher) mill levies to those new, much higher appraisal rates means more bucks for government.

The real and immediate tragedy is that whatever other needs are begging for attention—such as education, health care, or social services for our aged and infirm—will take a back seat as every “new” dollar is sucked up by skyrocketing government utility bills. The same goes for the “phased-in” reductions the Legislature planned for property taxes. Unless something happens to drastically lower Montana’s utility rates, the additional costs to government mean the planned reductions will be lucky to survive the next legislative session.

In short, after all these years of implementing the great Republican plans to grow our economy and boost our wages, we are left in one helluva mess—with rising property taxes, sky-high utility costs, rock-bottom wages and no foreseeable way out. Our citizens, our businesses, our government institutions and any new businesses we may have hoped to attract will all be negatively impacted, thanks to runaway utility costs brought to us courtesy of recent Republican legislatures and governors.

Which brings us to the growing herd of candidates who say they want to lead Montana as our next governor. Not one, I repeat, not one of these candidates should even be considered unless they have a plan to fix what’s already broken. Forget promises of a new and brighter day based on the plethora of old, tired and failed economic theories like “trickle-down” and “free market” solutions. Forget “jump-starting the economy”—the battery, like the rhetoric, has been cranked on so often it’s dead as a doornail.

What we need at the outset are solid, legal, practical plans that return Montana’s energy supply to the control of Montana’s citizens. Without that, we’re toast, plain and simple.

Anyone who would even think about voting for a candidate who promises to continue the current disastrous policies should seek counseling. Likewise, any candidate who isn’t capable of formulating a workable solution for our huge existing problems should do us all a favor and drop out of contention now.

Unfortunately, none of the current candidates has offered a viable solution to pull Montanans back from the breaking point of our untenable utility rates, rising property taxes and last-place wages.

Until they do, none of them deserve the chance to “lead” our troubled state.

When not lobbying the Montana Legislature, George Ochenski is rattling the cage of the political establishment as a political analyst for the Missoula Independent.


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