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Minnesota House of Representatives

State Representative Andrew Falk

439 State Office BuildingState Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
651-296-4228

For more information contact: Sandy Connolly 651-296-8877

Posted: 2009-05-08 00:00:00
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NEWS COLUMN

HOUSE PLAN MEETS GOVERNOR ON REVENUE, PRIORITIZES EDUCATION AND HEALTH CARE



Dear Friends and Neighbors,
Since this legislative session began, I have been contacted numerous times by constituents – educators, parents, hospital and nursing home staff, and business owners; all have asked to be spared from damaging cuts to help balance our state budget. I have told each of them that I agree – we cannot fill our budget hole by cutting funding to the things that make our state great.
The Governor, the Senate and the House all agree – to avoid these damaging cuts, we need new revenue. The choice of revenue is the sticking point. On Friday, I voted for a House and Senate plan that will protect our schools, our hospitals and our nursing homes by dedicating three new revenue streams to keep them whole.
This plan will generate nearly $1 billion, almost exactly what the Governor wants to borrow. The money generated will go into two accounts, one for schools and one for hospitals and nursing homes. This new revenue will go a long way toward preventing the kind of deep cuts that would be necessary with a “cuts alone" approach.
Under the bill, a new fourth-tier income tax rate of 9 percent would be created for the state’s highest income earners (married couples filing jointly and earning more than $250,000, and single heads of households making more than $212,500.) The bill also raises the cost of an alcoholic drink by a few pennies – the first increase in over 20 years, and puts a surcharge on banks and credit card companies that charge customers excessive interest rates.
While this isn’t enough new revenue to fully protect state services from budget cuts, it does place a priority on educating our kids and keeping our important hospitals and nursing homes open. And, at a time of record unemployment, it helps protect jobs.
The Governor has promised to veto this bill; I find that to be very unfortunate. While he has been good at portraying his “no new taxes” as being responsible and harmless, there has actually been serious harm done to our state over recent years.
Without new revenue, cuts have been the path to a balanced budget. Cuts to schools, cuts to city and county aid, cuts to health care, cuts to public safety and cuts to transportation; the cumulative effect of these cuts is staggering. Minnesotans recognize that the damaging cuts of the past few years have led to schools living on the edge, and as a result, repeatedly turning to local taxpayers for help. Cities and counties have been forced to cut services and delay improvements. Thousands of Minnesotans have lost their health insurance, nursing homes have closed, and more hospitals than ever are on the brink of financial ruin. And, despite the “no new taxes” decree, property taxes have increased by $3.1 billion since 2003 and fees, another word for tax, have gone up by over $2 billion. Whether the Governor will admit it or not, taxes have gone up, and services have gone down. Sadly, these tax increases hurt seniors, young families just starting out, and the growing ranks of the unemployed the hardest.
I remain hopeful that the Governor will recognize this is a reasonable and fair way to protect our schools and health care in Minnesota. It isn’t a final answer, but it’s a very good beginning.
Please feel free to call me if you have any questions about what is happening at the state legislature. I can be reached at 651-296-4228 or by email at rep.andrew.falk@house.mn. I look forward to hearing from you.

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