LOS ANGELES -- Montana officials decided this week to delay the state's tax and revenue anticipation note sale until after legislators meet in a special session early next month to address an unexpected $100 million budget deficit.

The sale was originally planned for early July, Bob Marks, director of Montana's Department of Administration, said Wednesday. However, state officials concluded it would make more sense to delay the cash-flow borrowing until after lawmakers devise a solution for Montana's budget problems, he said.

Gov. Stan Stephens recently called for a special legislative session, beginning on July 6, to address the gap in the state's fiscal 1992 and 1993 biennial budget. The shortfall resulted primarily from lower-than-expected income tax revenue and declining interest earnings because of low rates, said Steve Bender, Montana's assistant budget director.

State lawmakers will be asked at the special session to consider about $120 million of adjustments to cover a $102 million cash deficit expected by June 30, 1993, and provide some cushion, Mr. Bender said.

Initial plans for an early July note sale hinged on the assumption that a special session might not be held until late in the summer, Mr. Marks said. Under that scenario, he added, Montana probably would have needed to sell a second short-term issue in addition to the July sale.

But with a special session occurring so quickly, Mr. Marks said he expects the state "will be able to do all our issuance" for the notes in one deal. The Tran issue could range from $130 million to $150 million, depending on the Legislature's action, and likely will be sold "reasonably soon" after the special session concludes, Mr. Marks said.

Montana legislators already held one special session this year in January to help balance the fiscal biennial budget. At that time, officials agreed on appropriation cuts and revenue bills to help balance the budget.

The agenda for the upcoming special session will call for an examination of expenditure cuts, potential fund balance transfers, and revenue enhancements to help balance the budget, Mr. Bender said.

Mr. Marks stressed that Montana has enough cash and internal borrowing capacity from resources such as its highway trust fund to meet ongoing obligations in coming weeks. The state will "have no problem paying off" its existing notes, he said.

An $85 million Montana Tran issue that was sold last autumn will mature later this month. Moody's Investors Service rates those notes MIG-1 and Standard & Poor's Corp. rates them SP-1-plus.

In a separate development that Mr. Marks said would improve the state's budgeting flexibility, state lawmakers will mull a bill in the special session that restores the power of the governor to reduce the state budget by appropriate percentages in the event of shortfalls.

The Legislature's special session last January arose in part because a state judge said Gov. Stephens acted unconstitutionally when he used a state law to order spending cuts earlier in fiscal 1992.

That ruling is being appealed to the state supreme court, Mr. Marks noted. Restoration of that power to the governor would provide reassurance to the rating agencies that the state can respond promptly to unexpected budget deficits, he added.

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