Montana House approves pay raises for state employees, legislators

Legislators in Montana's House of Representatives passed a bill that would implement the state's 2026-2027 employee pay plan, authorizing raises for the state workforce, increasing health insurance payments, adjusting per diem travel rates and raising legislator salaries.

The basic structure of the employee pay plan, carried in House Bill 13, is negotiated each biennium between the governor's office and public employees' unions; and usually passes the Legislature with strong bipartisan support. However, this session the bill is more controversial due to an additional lawmaker pay increase for future legislators.

The pay plan for state and Montana University System Employees calls for either a $1-per-hour or 2.5% raise, whichever is greater, for each of the next two years, effective July 1.

The plan also increases the state's per diem meal rates by tying them to 70% of the standard federal rate of reimbursement — bumping up each meal roughly from $3 to $4 dollars — and boosts employer health insurance contributions by $26 in 2026 and an additional $27 in 2027.

Bill sponsor Rep. John Fitzpatrick, R-Anaconda, added legislative salary increases to the pay plan, and tied lawmaker pay to become a function of the state's average wage, which he said would stop the legislature from debating the issue every two years.

"I've been here for 49 years of my life — mostly as a lobbyist. I've heard this particular discussion at least half a dozen times sitting up in the gallery," Fitzpatrick said on the House floor last week. "If we'd taped this particular discussion back in 1987, we could replay it today and it would be the same set of arguments over and over. The only thing that would change would be the numbers."

A fiscal note attached to the bill estimates each round of raises for state workers will increase the state's payroll costs by roughly $41 million a year and the cost of increasing legislator salaries would be roughly $1.4 million and $2.2 million during the next two years. The cost of increasing health plans are $2.9 million and $7.9 million respectively during the next two years.

Fitzpatrick said using the state's average wage is an objective, transparent standard that fairly compensates lawmakers for the time and work they do both during the 90-day session, and would make the job accessible to more individuals, but many lawmakers pushed back, emphasizing that their work is a public service and sacrifice.

"We all come into this from the viewpoint of public service. That's why we came here, not because we want to be career politicians, but because we want to do good in the world." Rep. Jane Gillette, R-Three Forks, said. "And if we make a low wage, so be it."

Gillette, a dental researcher and healthcare consultant, said she works hard outside of the session to meet her financial goals, and works during the session as well.

"I just don't think this is the way we should be making money," she said.

Lawyer and Rep. Bill Mercer, R-Billings, brought forth an amendment to HB 13 to strip legislator pay from the bill, saying he felt the Legislature was "too comfortable" increasing their own compensation.

In 2019, Mercer's first session, legislators earned $11.56 an hour. As state employees, legislator pay is part of the employee pay plan, and during the current session, legislators earn $16.11 an hour, or $128.88 per day, in addition to a per diem allotment of $206 — a rate the legislature increased during the 2023 session to match the federal per diem rate .

During the 2023 session, the Legislature passed a bill to raise lawmaker pay from $16 to around $24 an hour with bipartisan support, though on relatively narrow margins. Gov. Greg Gianforte, a Republican, vetoed the bill, writing in his veto memo that "As has been the case since before our nation's founding, public service comes with personal sacrifice — long hours away from home, less time with family, and appropriately limited compensation."

The governor's office did not respond to questions about whether the Gianforte would support the employee pay plan with legislative pay included.

Rep. Sherry Essmann, R-Billings, who spent a career in finance, said that she had worked for every single raise she'd earned in her career, and believes this one is justified.

"We bring a ton of expertise and experience to this body," Essmann said. "I don't know anyone who would take a responsible job in the private industry … for $33,000 a year."

Lawmaker wages are currently equivalent to an annual salary of $33,900. Under HB 13, legislators working during the 2027 session would make 80% of the state average hourly wage and during the 2029 session would make 100% of the state hourly wage.

According to the latest Occupational Employment and Wage Statistics survey by the U.S. Bureau of Labor Statistics, the mean hourly wage in Montana across all occupations was $26.88 in 2023, or $55,920 annually.

Lawmaker salaries would not change for the current session, which runs 90 days.

Hamilton Republican Rep. David Bedey told his colleagues that they should consider how limiting legislative pay can be to individuals who might want to serve in the body but cannot.

In the House, he said, there are retired folks, independently wealthy individuals, remote workers, and public employees who forgo their legislative salary but are paid through their primary jobs. He said he was a remote worker, who is now retired from an engineering firm.

"I think that we have a Legislature from an economic standpoint that is perhaps overrepresented in certain sectors and underrepresented elsewhere," Bedey said. "It's a pretty simple value proposition. Common sense would dictate that the tile layer, who has to shut his business down to come to the Legislature, has a disincentive for serving."

Rep. Terry Falk, R-Kalispell, favored removing legislative pay increases from the bill, saying that current pay easily covers lawmakers' stint in Helena, even considering paying rent and other expenses. He said that anyone, from a fast-food worker on up, could make it through on current wages.

"I maintain we get paid pretty well. It's enough at least," Falk, a real estate investor, said. "We're so busy, we don't really have time to spend money on everything else."

Fitzpatrick said that often during these discussions, it's brought up that fast-food workers make more than legislators, but he wanted a new analogy. Referencing a handout from the Montana Cannabis Association, he said that the average wage in Montana's growing marijuana business is $20 an hour.

"The guys that are distributing pot in our communities are making three dollars and 92 cents more than the folks that are sitting in this building," Fitzpatrick said. "I'm kind of of the theory that folks that are sitting here and bring a wide variety of talent and expertise to craft public policy for the state of Montana deserve a better salary than those who put dope in plastic bags and hand it across the counter."

House lawmakers voted to keep the legislator pay raises in the bill, and passed the employee pay plan 71-27 on third reading.