By Dustin Hurst | Watchdog.org

HELENA —  As a sitting member of the Land Board in March 2010, Attorney General Steve Bullock, a Democrat, probably didn’t anticipate catching so much grief over his vote to oppose development of the Otter Creek mine in southeastern Montana.

BULLOCK: We need to make sure Montana is getting its share.

As Bullock seeks a promotion to higher office — he’s running for the governor’s mansion — that vote continues to haunt him and he’s forced to play defense over it.

Bullock’s opponent, Republican Rick Hill, says the vote against Otter Creek development was irresponsible and could have cost the state millions in education funding.

At the second gubernatorial debate Thursday night on Montana Tech campus in Butte, moderators queried Bullock about his opposition to developing the natural resource, which already has netted Montana $86 million, most of which the state funneled directly into education.

It’s the second week in a row Bullock has played defense on the issue. Moderators at the first debate last week in Helena delivered a similar inquiry.

Bullock held firm on his 2010 vote as a member of the state Land Board, the custodian of Montana-owned lands and certain resources. The Democrat explained to the capacity crowd stuffed into the Montana Tech auditorium that he felt St. Louis-based Arch Coal, the investor, would pay too little for the 572 million tons of coal available under the proposed agreement.

“What I said when Otter Creek came up is that we in Montana have a history of giving away our resources,” Bullock offered. “We need to make sure Montana is getting its share.”

Bullock said the Montana coal brought about one-ninth the price of certain coal reserves across the border in Wyoming.

Hill, his Republican opponent, scoffed at Bullock’s assertion, telling the crowd that external factors lowered the price of the Montana coal.

HILL: Lack of infrastructure necessitated a lower valuation.

“You can’t compare it to Wyoming coal or even compare it to other coal mines because there’s no infrastructure there whatsoever,” Hill argued. “There’s no transportation system, there’s no workforce that’s directly available or trained.”

Hill hit on a troubling problem Montana’s neighbor to the east — North Dakota — experiences while simultaneously enjoying an economic revival thanks to burgeoning oil fields. Though thousands of new wells drilled miles below the surface offer millions of gallons of never before tapped oil, companies have difficulty transporting their product to refineries because of a staggering lack of underground pipelines.

As a result, oil barrels from North Dakota’s enormous Bakken geologic formation, which spills into parts of eastern Montana, sell for about $20 less than it would in more developed areas.

Still, Hill said he’s hopeful the Otter Creek coal reserve will serve as an engine for economic growth for Montanans.

“There’s no reason, with all the wealth we have in this state, that we should be next to last in how much we have in take-home pay,” Hill said.

Bullock again stood pat on his vote against the development. “We need to make sure we get a fair price,” he said.

SCHWEITZER: Protesters want me to return $86 million in coal money?

Bullock sided with Superintendent of Public Instruction Denise Juneau in opposing the agreement. Gov. Brian Schweitzer, Auditor Monica Lindeen and Secretary of State Linda McCulloch formed a majority to approve the deal.

The agreement will boost Montana’s economy and tax revenues for years to come.

A May 2012 study by University of Montana researchers Patrick M. Barkey and Paul G. Polzin reveals as many as 2,648 new jobs will flow to the state during peak mine and railroad construction, bringing $103.5 million in new personal income to the state. Eastern Montanans’ household incomes should increase about 8 percent, the duo said.

Continuing mine operations will mean 1,740 permanent jobs and $125 million in new annual income, generating at least $91 million in annual tax revenue for the state.

A small gaggle of out-of-state protesters occupied the state Capitol in Helena  in August to ask the Land Board to reverse course on the deal. The occupiers warned that the coal dust from passing trains would harm public health in vulnerable Montana cities.

The protesters also cried that the state shouldn’t allow the company to sell coal that will eventually be burned in China, an energy-hungry and rising superpower with few environmental safeguards.

Much of the Otter Creek coal will find its way to China through Pacific coast seaports.

CUFFED: Helena police arrested 23 protesters who refused to leave the Capitol

Schweitzer didn’t listen to the protesters and has playfully mocked those who would ask the panel to change its collective mind.

“Is what they are asking me, is to give Arch Coal their $86 million back?,” Schweitzer asked the AP in August.

Schweiter said the mine should generate more than $5 billion in tax revenue through its lifetime.

Contact Dustin Hurst at Dustin@Watchdog.org or via Twitter using the @DustinHurst handle.