Governor asks court to 'stay' lawsuit over Marijuana tax money

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Governor asks court to 'stay' lawsuit over Marijuana tax money

Legal Battle Over Montana Marijuana Tax Revenue Allocation Continues.

Over nine months after Montana’s 2023 legislative session adjourned, a broadly supported bill to change how tax money from marijuana sales is used is still up in the air, the subject of ongoing legal wrangling.

Senate Bill 442 would reallocate taxes collected from recreational and medical marijuana sales. In the past two years the state has collected nearly $100 million in revenue from these taxes.

SB 442, which passed the Senate and House with huge support, changes the use of that revenue, adding improvements to county roads that access public lands to the current funding of addiction treatment, veterans programs and wildlife habitat projects.

On May 2, 2023, Governor Greg Gianforte vetoed the bill, saying it failed to designate an appropriation and provided an “unprecedented” shift of state resources from the General Fund to the counties for road maintenance.

When a veto is issued, Montana’s Constitution requires the legislature be given the opportunity to override it, and that’s where this story gets complicated.

According to Senator Dan Bartel (R-Lewistown), “The Senate voted to end the session before the veto passed across our rostrum.” That means the Senate had officially adjourned its 2023 session before the notice of the veto arrived.

Yet while the Senate was adjourned, the House was still in session. The House received notice of the veto while the Senate did not, an unusual set of circumstances.

While the Montana Constitution requires the legislature be given the opportunity to override a veto, it provides only two ways to do so: by vote if the Legislature is still in session when the veto is issued, or by a poll of legislators if the veto is issued after the legislature adjourns.

What happens when one half of the legislature is in session, but the other half has already adjourned? That question is the crux of the legal battle over this bill.

The governor argues the Legislature was still in session when he issued his veto of SB 442, but two wildlife groups — Wild Montana and the Montana Wildlife Federation— joined with the Montana Association of Counties to sue the Governor and Secretary of State, saying the legislature should have been polled.

On Jan. 16 Lewis and Clark County District Court Judge Mike Menahan sided with MACO and the wildlife groups, saying “the legislature cannot vote to override a veto before it is aware of the veto.”

Judge Menahan ordered Secretary of State Christi Jacobsen to conduct the poll to see whether legislators wanted to override the Governor’s veto of Senate Bill 442.

On Feb. 6 the Governor asked the court to “stay” that ruling while he prepares to appeal it, arguing, among other things, that the Constitution allows the legislature to call a special session for a veto override vote, if it so chooses and that the court can’t create a new process for how to conduct a veto override vote.

MACO and the wildlife groups oppose the stay.

“The Governor is using a made-up loophole to avoid doing his job,” said Rylee Sommers-Flanagan, executive director of Upper Seven Law and attorney for the conservation organizations. “In fact, the Governor has nothing at stake here except his desire to stop the legislature from exercising its constitutional authority to pass the public lands, infrastructure, and veterans bill that 130 out of 150 legislators voted for during the session.”

The Governor’s office was contacted for this story, but has a policy of not commenting on on-going litigation. The Governor has 60 days from Menahan’s Jan. 16 ruling to file an appeal. Meanwhile Judge Menahan will decide whether or not to issue a stay.

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Region: Montana

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