Budget director David Ewer said three full-day meetings between cabinet level staff and members of the state Board of Regents are leading to an agreement on the tuition caps, which would be in effect for the 2007-08 and 2008-09 school years.
Ewer said he doesn't know yet how much it would cost, but said the price tag would be "substantial."
The Board of Regents, which runs the university system, has the authority to set tuition. In the past the board has often blamed inadequate funding from the Legislature on near double-digit tuition hikes that have recently been levied on students.
Ewer said the key to the proposed tuition cap is that everyone will be in agreement, since the governor and the Legislature cannot constitutionally tell the regents how to spend their budget. The Legislature, however, does get to set the final budget amount, usually based upon recommendations from the governor's office.
"We're working hard," Ewer said. "We're not there yet."
Republican legislative leaders have unveiled a plan to cut tuition by 5 percent, saying it would cost about $57 million.
"What they're talking about is increasing it 5 percent, what we're talking about is actually decreasing it," said Sen. Robert Story, R-Park City. "If holding it to 5 percent is good, then actually decreasing it 5 percent is better."
Schweitzer has called the GOP tuition cut offer disingenuous.
Regent Mark Semmens said they are trying to figure out how much of a budget increase is needed to hold tuition increases at 5 percent for the four-year colleges and freeze it at two-year colleges.
"We're all comfortable enough that it is within reach," he said.
Tuition was raised an average of 8 percent for students entering four-year colleges this fall, another in a long string of hikes. Tuition now makes up a larger share of the university system's budget than it ever has, regents say.
State support for universities has fallen from 75 percent of university spending in 1988 to about 40 percent now. Montana ranks among the lowest states in the region for the level of state tax money that flows to universities on a per-student basis.
Ewer is in the process of building the governor's recommended budgets, and said he is juggling demands among the state's biggest budget items: education, public safety and public health programs.
"The governor's vision is education," Ewer said. "We have an obligation to educate Montana kids in this increasingly competitive world."
Ewer called the tuition cap discussion an "equal partnership" with the regents.
"It's not going to work if the regents feel uncomfortable," he said.
Lawmakers on the panel did not take action on the plan, but legislative lawyers warned that the Legislature has to be careful when it crafts a spending bill for such a plan to make sure it doesn't look like the Legislature is telling the Board of Regents how to spend its appropriation.
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