Nearly 50 years ago I was asked to collaborate with State Senators Tom Towe and Chet Blaylock in writing a voter information pamphlet advocating a Montana Constitutional Amendment to create Montana’s Coal Tax Trust Fund. Constitutional language, our arguments and Montana’s vote are below.

What we Montanans foresaw has happened, but for reasons we could not then have comprehended. Fossil fuels are one of the main causes of humanity-induced catastrophic climate change. The end of coal mining in Montana will eventually happen. As the day we foresaw approaches what are we to do? Should we just sit on our multibillion dollar nest egg content to spend the interest?

My thinking is that we should use a portion of our nest egg to create a replacement revenue source for the Trust Fund. That subsequent revenue source for future generations should be a tax or a disposal fee on high level nuclear waste deposited in a properly sited high level nuclear waste repository like the first one in the world expected to open this next summer in Finland. Montana is 17,000 square miles larger than Finland and we have earth scientists, underground geology and mining expertise, and water-related knowledge without peer. Once 3/4 of both houses of our legislature agree on the way to do this then they certainly will have the deep pockets to get it done.

According to the Advanced Nuclear Technology Program at the Electric Power Research Institute (EPRI), “At the end of 2020, 70% of the largest U.S. utilities had set targets for net-zero emissions or deep decarbonization.” According to program head, Craig Stover, “We hear from utilities that say they have committed to an ambitious carbon goal and run their models and realize they can’t meet their targets without a nuclear plant.” Contemplating a nuclear plant and enjoyment of the climate change responsive electricity based technology that plant enables, without addressing long term nuclear waste disposition is not responsible, one generation to the next.

I hope our legislature and its legal staff will be able to devise a way to assure public trust by blending the process followed by Finland, our state’s experience permitting exploration and underground mining, and expanding the major facility siting act to include high-level nuclear wast disposal.

“AN ACT TO SUBMIT TO THE QUALIFIED ELECTORS OF MONTANA AN AMENDMENT TO THE CONSTITUTION TO REQUIRE THE LEGISLATURE TO DEDICATE A PORTION OF THE COAL SEVERANCE TAX TO A PERMANENT TRUST FUND.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA: Section 1. Article IX of the Montana constitution is amended by adding a new section 5 that reads as follows: Section 5. Severance tax on coal -- trust fund. The legislature shall dedicate not less than one-fourth (1/4) of the coal severance tax to a trust fund, the interest and incomes from which may be appropriated. The principal of the trust shall forever remain inviolate unless appropriated by vote of three-fourths (3/4) of the members of each house of the legislature. After December 31, 1979, at least fifty percent (50%) of the severance tax shall be dedicated to the trust fund.

For a permanent trust fund from coal taxes

Against a permanent trust fund from coal taxes

Arguments for approval and against approval.

Arguments advocating for approval and those arguing against for the proposed amendment were provided to the citizens of the state to help inform voter decision. Rebuttals to each of the arguments were also provided in the 1976 Voter Information Pamphlet.

Thomas Towe, Chet Blaylock, and John Driscoll provided an argument advocating for the approval of the amendment. In their argument, they estimated that Montana had coal reserves of 108 billion tons. This was recognized as a valuable, irreplaceable resource. They argued that Montana had previously improperly managed revenue from the State's rich Copper mining legacy and had relatively little to show for it. In addition, they argued that other areas of the country had mismanaged revenue from coal resources and also had relatively little to show for it. As a result, they proposed the development of a permanent trust fund to manage revenue from Montana's coal reserves. This was intended to create an avenue to benefit future Montana generations with revenue derived from coal mining that would be in place should the coal no longer exist or have value. They described the amendment as a forward looking proposal intended to allow future generations in Montana to share in the riches derived coal mining in the 1970s.Id. at 2.

Dan Yardley, Harold C. Nelson, and Francis Bardanouve provided an argument advocating for the rejection of the measure. In their argument they estimated that the value of the trust would exceed hundreds of millions of dollars in a relatively short period of time. They also opined that investment of funds should fall within the private sector. They portrayed concern, that due to the large value of the trust, there was potential for corruption or mismanagement of the revenues by the legislature. In addition, they suggested that the proposed trust fund would be redundant since the state had previously approved a measure in 1974 which created a resource indemnity trust funded by the gross tax of all minerals which included coal.Id. at 4.

Dan Yardley and Francis Bardanouve also provided an argument rebutting Towe, Blaylock, and Driscoll's argument advocating for approval of the measure. In their rebuttal, Yardley and Bardanouve indicated that revenue from the coal severance tax was currently being utilized to develop local areas which had sustained increased tax costs due to coal development. The revenue had been allotted to help communities that had sustained increases in expenditures resulting directly or indirectly from coal use or mining. They cited highway improvement, creating community parks, improving the public school system, and county level planning as tangible benefits being realized at the time this measure was brought forth. They argue that the wide range of uses for severance tax revenue used at the time adequately provided benefit to the citizens of the State without creating a multimillion dollar trust fund. Yardley and Bardanouve considered the amendment unnecessary at the time.Id. at 4-5.

Chet Blaylock, Thomas Towe, and John Driscoll provided an argument rebutting the argument advocating rejection of the measure. In there argument, they conceded that the constitutional amendment would establish a second trust in the State of Montana related to coal and mineral extraction, but indicated that it was needed to benefit future generations. They countered the argument that the trust fund would foster political corruption by stating that a three-quarter vote by each house of the legislature would be required to access the principal of the trust which they recognized was "extremely difficult to achieve without proving a compelling necessity."Id. at 5.

Conclusion

The citizens of the state approved the measure by a vote of 178,773 to 103,001 on the 2nd of November 1976.