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State Representative Kim Norton
100 Rev. Dr. Martin Luther King Jr. Blvd.
651-296-9249
For more information contact: Matt Swenson 651-297-8406
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NORTON SAYS STRONG MINNESOTA REQUIRES NEW, PROGRESSIVE REVENUE
ST. PAUL, MN - Rep. Kim Norton (DFL - Rochester) voted Saturday for the House Omnibus Tax Bill (HF2323) saying new, progressive revenue is needed to keep Minnesota strong during the state’s worst ever fiscal crisis. The bill passed by a vote of 68 to 65 after months of careful work by the House Taxes Committee. The House Tax Bill offers the most significant tax reform in 20 years and raises $1.5 billion in new revenue by eliminating corporate tax loopholes, increasing progressivity in the tax system by raising the income tax on Minnesota’s highest earners ($300,000 and above) to more closely reflect what is paid by middle income earners, and providing for moderate tax increases on optional consumer goods such as alcohol (3-5 cents) and cigarettes (54 cents).
“We’re looking at the worst budget crisis in state history. With tough decisions on every front, lawmakers in the House have proposed responsible, thoughtful budget plans that protect jobs, our most vulnerable, and our future," said Rep. Norton. “We’ve made $1.6 billion in careful cuts and enacted new and needed reforms to make government more efficient. But the success of those bills and the course of our future require a tax bill that raises some revenue in order to save us from having to cut $1 billion more in jobs and services to Minnesotans. If we want a strong future and an end to this recession, we have to pay for it.”
According to a Tax Incidence Study released by the Minnesota Department of Revenue earlier this year, the state’s low- and middle-income earners ($113,000 and below) pay on average 12% of their income in state and local taxes while Minnesota’s highest earners ($447,000) pay just 8.8%. The House Tax Bill would address that disparity by creating a new 4th tier income tax bracket for the state’s highest earners and making moderate reductions in income taxes on low-and middle-income Minnesotans. It would also significantly slow the pace of rising property taxes ($3.1 billion since 2002) that have made the state’s tax system more regressive in recent years.
Governor Pawlenty has indicated he will veto any proposed tax increases aimed at balancing the budget shortfall. But Norton has raised objections to the governor’s proposed borrowing plan that would replace tax increases with revenue bonding. The governor’s plan has never been attempted in the history of the state. It would borrow $1 billion from future revenues, accumulate $600 million in interest payments, and take 20 years to pay off. The House soundly rejected Pawlenty’s plan Friday by a bipartisan vote of 130 to 2.
“We can’t push this deficit onto our children, we have to take care of it now,” Norton said. “Short-term fixes just won’t cut it. Lawmakers have to address these problems squarely and honestly. Minnesotans elected us to lead, even when the decisions are hard. These decisions are hard, but I won’t easily sacrifice the future of our students, the quality of our hospitals, or the strength of our economy just to avoid making them.”
Saturday’s vote on the House Tax Bill concluded a 6-day series of marathon floor sessions in which lawmakers passed ten finance bills aimed at balancing Minnesota’s record $6.4 billion budget shortfall. Now those bills must be reconciled in conference committees with the Senate before being sent to Governor Pawlenty’s desk. Budget balancing plans between the House, Senate, and governor are different, and rely on the following budget frameworks:
Minnesota House of Representatives
• Makes $1.6 billion in budget cuts
• Delays $1.8 billion in payments to K-12 schools
• Relies on $1.5 billion in new revenue
• Adds $300 million in budget reserves
• Balances the budget in 2012/2013
Governor Tim Pawlenty
• Makes $1.5 billion in budget cuts
• Uses $1.3 billion in Health Care Access funds to pay for other services
• Delays $1.3 billion in payments to K-12 schools
• Borrows $1 billion from future revenues
• Adds $500 million in tax cuts and budget reserves
• Leaves a $2.6 billion deficit in 2012/2013
Minnesota Senate
• Makes $2.4 billion in budget cuts
• Relies on $2.2 billion in new revenue
• Balances the budget in 2012/2013
Going into the final weeks of the 2009 Legislative Session, Rep. Norton is confident lawmakers will find compromise and a responsible end to one of the most difficult legislative sessions in memory.
“The bills we passed this week will start the discussion with the Senate and the governor,” said Norton. “It would have been easier to vote ‘no’. But people in my district and the people of Minnesota deserve a budget that addresses our deficit in a balanced manner; one that preserves the quality of life Minnesotans expect and deserve. I’ll continue doing everything I can to make that happen.”
Rep. Norton encourages all residents of District 29B to contact her directly with their questions, concerns, and suggestions in the coming weeks. Norton can be reached by phone at (651) 296-9249 or by email at rep.kim.norton@house.mn. The legislative session is scheduled to adjourn May 18.
News Items
- Rep. Norton Selected as Vice Chair of House Health and Human Services Finance Committee - (Posted: 2012-12-14 00:00:00)
- It’s Time for Legislature to Get Back to Basics, Balance the Budget Honestly - (Posted: 2012-12-11 00:00:00)
- Second Saturday Coffee Meeting Date Changed to December 9 - (Posted: 2012-12-03 00:00:00)
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