State Fiscal Briefs

September 2022

Montana’s budget basics

According to the National Association of State Budget Officers (NASBO), Montana’s total expenditures in fiscal year (FY) 2021 were $11.1 billion, including general funds, other state funds, bonds, and federal funds. NASBO reported that total expenditures across all states in FY 2021 were $2.7 trillion, ranging from $4.7 billion in Wyoming to $512.8 billion in California.

Each state allocates spending and taxes differently among different levels of governments, and local governments often administer programs with state funds, so combined state and local government data show a more complete picture of individual benefits and contributions when comparing states.

Per the US Census Bureau, Montana’s combined state and local direct general expenditures were $10.4 billion in FY 2020 (the most recent year census data were available), or $9,577 per capita. (Census data exclude “business-like” activities such as utilities and transfers between state and local governments.) National per capita direct general expenditures were $10,540.

Montana’s largest spending areas per capita were public welfare ($2,268) and elementary and secondary education ($1,968). The Census Bureau includes most Medicaid spending in public welfare but also allocates some of it to public hospitals. Per capita spending is useful for state comparisons but is an incomplete metric because it doesn’t provide any information about a state’s demographics, policy decisions, administrative procedures, or residents’ choices.

Montana’s combined state and local general revenues were $10.7 billion in FY 2020, or $9,844 per capita. National per capita general revenues were $10,933. Montana does not levy a general sales tax. After federal transfers, Montana’s largest sources of per capita revenue were property taxes ($1,806) and individual income taxes ($1,233).

Montana’s politics

Governor Greg Gianforte, a Republican, was elected in 2020 with 54 percent of the vote. The next gubernatorial election is in 2024.

Republicans control both the House of Representatives (67 Republicans to 33 Democrats) and Senate (31 Republicans to 19 Democrats). Control of the governor’s mansion and each house of the legislature gives Republicans a trifecta in Montana. All Montana House seats are on the ballot in 2022 because representatives serve two-year terms. Senators serve four-year terms; roughly half the senatorial seats are on the ballot in 2022, and the other half will be up for election in 2024.

Montana’s budget institutions, rules, and constraints

Montana uses a biennial budget. The legislature must pass a balanced budget and is prohibited from carrying a deficit over into the following year. The state has no further tax and expenditure limits, and there are no debt limits on either authorized debt or debt service incurred by the state.

(Note: Some states have informal budget institutions that constrain overall spending growth or a specific expenditure’s growth.)

Montana’s current budget

Governor Greg Gianforte has not released a FY 2023 supplemental budget proposal (the state uses a biennial budget) or given a state of the state address in 2022.

Montana enacted its FY 2022-2023 biennial budget in May 2021. The enacted budget included $2.6 billion in general fund spending for FY 2022 and $2.7 billion in general fund spending for FY 2023. According to the governor, Montana also passed multiple tax cuts in calendar year 2021, including reducing the state’s top individual income tax rate from 6.9 percent to 6.75 percent.

Under the American Rescue Plan, Montana will receive $906 million in direct state fiscal aid and $257 million in local government aid from the federal government. As of January 2022, Montana had spent part of its ARP funds on capital construction, broadband expansion, economic development, and public health programs.

According to NASBO, Montana’s recent expenditure totals (general fund spending/total spending, including federal transfers) were:

  • FY 2022: $2.7 billion

  • FY 2021: $2.7 billion/$11.1 billion

  • FY 2020: $2.3 billion/$8.3 billion

  • FY 2019: $2.3 billion/$7.2 billion

For more on Montana’s budget, see