Minnesota House of Representatives
Public Information Services


Public Information Services Menu

Dayton’s budget proposal prioritizes health, education and transportation

By Ricky Campbell
Gov. Mark Dayton enters a State Capitol hearing room to deliver his biennial budget proposal. Photo by Paul Battaglia

Gov. Mark Dayton on Tuesday released a two-year, $45.8 billion biennial budget proposal that includes an expansion of MinnesotaCare, increased education spending and an increase in the state’s gas tax.

The spending plan, called “An Opportunity Agenda for a Better Minnesota,” is about $1.2 billion more than the current two-year budget. It includes expansion to the working family and child care tax credits, would close corporate tax loopholes and include sales tax “clarifications.”

To offset the increased spending, which includes a $312 million insurance premium relief bill, the budget banks on the state’s November forecast that projects a $1.4 billion surplus.

Among the budget increases are $609 million for E-12 education; $62 million for the state grant program to increase student aid for more than 82,000 students; $60 million to further expand broadband in Greater Minnesota; and $20 million to restore funding in a pair of job creation funds that were cut last year.

But Republican lawmakers, who control both chambers of the Legislature, said the DFL governor’s proposal is too bold. Expanding the public health insurance option is a “non-starter,” according to Senate Majority Leader Paul Gazelka (R-Nisswa).

While most decision-makers at the capitol see the same issues, the solutions differ.

“We look for tax relief as well,” Gazelka said in an afternoon media briefing. “That’s an area that I think Minnesotans deserve. We had a $2 billion tax increase four years ago. We now have a surplus, and yet the governor’s proposal is to increase spending 10 percent. Ten percent. That’s just more than we think is appropriate.”

“I was encouraged last night when the governor talked about stability in state government and wanting to sure that we’re maintaining it and finding efficiencies in government. But that growth in spending is a concern,” House Majority Leader Joyce Peppin (R-Rogers) said.

The governor is calling for $300 million in tax relief that, he says, would affect 450,000 Minnesotans and their families. Included in that is $94 million to expand the Working Family Tax Credit to 107,000 new households and $34 million to cut by 40 percent farm property taxes for school district debt. Additionally, he proposes a $61 million Child Care Tax Credit to help 95,000 families afford child care.   

Dayton’s budget will be broken down into separate bills and head into a number of committees over the coming weeks.

Public option and health care

House Speaker Kurt Daudt comments on the governor's biennial budget proposal that was released Tuesday. Also present are House Majority Leader Joyce Peppin, from left, Senate Majority Leader Paul Gazelka and Rep. Jim Knoblach, chair of the House Ways and Means Committee. Photo by Andrew VonBank

Saying the state needs to “reform for the future,” Dayton unveiled his so-called “public option plan,” an expansion of MinnesotaCare. The public option would require a one-time initial cost of $12 million and shift $716 million from the General Fund into the Health Care Access Fund to help cover costs.

According to Minnesota Management and Budget Commissioner Myron Frans, the reform would expand medical coverage provided through the Health Care Access Fund from 4 percent to 10 percent.

The public option would be sold through MNsure as an additional option on the individual market.

Aware the topic is a lightning rod for Republican lawmakers, Dayton said, “They are concerned about more competition. This is one way of providing more competition.”

Dayton also suggested continuing the provider tax, which is scheduled to end December 2019.

“I believe it would be a serious mistake to eliminate such an essential source of state funding for health care,” Dayton said.

Funding for a health insurance premium relief bill (HF1/ SF1*) now in a conference committee is also included in the governor’s plan. Senate and House lawmakers tasked with finding common ground on divergent insurance fixes on Tuesday were nearing a $300 million-plus rebate plan. Dayton signaled Tuesday his administration and top Republican lawmakers were making inroads, but the details are stilling being ironed out.

Dayton’s proposal from the onset has been to spend $312 million for 25 percent across-the-board relief for Minnesotans facing skyrocketing premiums on the individual market.

Transportation and the returning gas tax

Back again this year is a call to increase the state’s gas tax.

It would cost “the average Minnesotan driver $75 a year,” Dayton said. “…It’s not even the Cadillac version. It’s one that will maintain the existing highway conditions and make some easy improvements and expansions.

“If we don’t do that, or don’t do something like it, the guarantee is that the conditions are going to get worse. Highways are going to get more congested. They’re going to become more antiquated; more expensive to repair now and in the future,” Dayton added.

According to the administration, Minnesota is facing an $18 billion transportation funding gap over the next 20 years. Forty percent of new revenues would go to counties, cities and townships to repair or replace 1,700 miles of roads and 235 bridges.

The plan also includes beefing up bus rapid transit and light rail lines in the Twin Cities metropolitan area and 500,000 additional hours of service to Greater Minnesota.

“A little disappointed that he’s still willing to push the gas tax,” Peppin said. “…Certainly roads and bridges will continue to be a priority for our caucus.”

Overall, House Speaker Kurt Daudt (R-Crown) said the governor intends on spending too much and not focusing enough on tax breaks.

“The good news for everyone is that, I think, we see some of the same problems in Minnesota,” Daudt said. “I think we see that middle income Minnesotans aren’t thriving in the way that they should in this economy. We see that young learners in the state of Minnesota need some better options and some better choices to be more successful in their education careers. Frankly, I think we can do better in growing our state’s economy and doing better for all Minnesotans.”

Search Session Daily

Priority Dailies

House, Senate head toward lawsuit over governor's legislative funding veto

See you in court. That was the message Friday from Republican House and Senate leadership in ...

Weary lawmakers pass final budget bills, wrap 2017 special session

(UPDATED AT 3:27 p.m. with Gov. Dayton reaction) Day three of the 2017 special session saw la...

Recent Dailies

Lawmakers, registrars sound off on rollout of new motor vehicle licensing system

House lawmakers on Monday heard from Minnesotans exasperated by this summer’s rocky rollout of th...

Mediation ordered to work out legislative, gubernatorial funding dispute

The Minnesota Supreme Court has ordered the Legislature and Gov. Mark Dayton to use mediation to ...

2017 state fair poll results

The cheese curds have been eaten, cookies consumed and Pronto Pups polished off. And, with the 20...

Minnesota Supreme Court takes up legislative funding battle

The fate of Gov. Mark Dayton’s legislative funding line-item veto now rests with the Minnesota Su...

Judge rules Dayton’s veto of Legislative funding violated constitution

(Updated 3:19 p.m.) A Ramsey County judge on Wednesday ruled that Gov. Mark Dayton’s line-ite...

New laws on tap for July 1 include long-awaited Sunday sales

It took a special session, but the state government is funded for the 2018-19 biennium. The f...

Judge OKs legislative funding for 90 days

A Ramsey County judge has given the go-ahead for the House and Senate to remain operational until...

Dayton, legislative leaders have their day in court over funding issue

Lawyers for Gov. Mark Dayton and Republican legislative leaders met in a Ramsey County court Mond...

Legislative leaders will sue governor over line-item veto

Leaders of the Republican-controlled Legislature are moving forward with their lawsuit against DF...

Governor still hopeful negotiations can solve legislative funding fight

Gov. Mark Dayton said Friday he remains hopeful his dispute with Republican legislative leaders o...

Dayton signs budget bills into law, but showdown with lawmakers continues

DFL Gov. Mark Dayton announced Tuesday he would sign into law nine budget bills that make up the ...

Lawmakers pass bonding bill to close out special session

With all other omnibus budget bills agreed to, the House wrapped up the special session early Fri...

Lawmakers send governor bill to fund state government

Lawmakers late Thursday night OK’d the appropriations needed to fund state government agencies, v...

Despite veto threats, House passes mixed-bag uniform labor bill

Pleading for brevity as the Legislature entered its third day of a deadline-neglecting special se...

House repasses tax bill amended with extended Super Bowl bar hours

The omnibus tax bill, including a few extra hours for Super Bowl revelry, is headed to the govern...

With self-imposed deadline gone, Legislature still piecing together budget

When Gov. Mark Dayton, a DFLer, and Republican leaders House Speaker Kurt Daudt (R-Crown) and Sen...

House again OKs transportation plan heavy on borrowing, General Funds shifts

The House passed another omnibus transportation finance bill Wednesday that would rely on General...

A hostile start to special session sees two omnibus bills passed before 7 a.m. deadline

One night of overtime was not nearly enough for the Legislature to complete its crafting of a 201...

Compromise education bill passed by House in special session

After weeks of negotiations over the best approach to reduce the achievement gap, lawmakers passe...

‘Bipartisan,’ trimmed down special session tax bill gets House approval

Called the largest tax relief package in 20 years, end-of-session negotiations produced a tentati...

Legislative leaders expect special session to last through the night

One overtime may not be enough for the Legislature to complete its crafting of a biennial state b...

Public Information Services  ·   175 State Office Building, Saint Paul, MN 55155   ·   Public.Information@house.mn