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State Representative Dean Urdahl

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Posted: 2016-03-07
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Guest Column

Overview of key issues as 2016 session starts


 

By Rep. Dean Urdahl

The 2016 legislative session is beginning and once again we face some challenging issues. Here is a quick overview of some items expected to make headlines in the coming months:

State surplus

While 2016 is not a budget year by definition, some of the top legislative issues will necessarily pertain to taxes and spending. This is especially true because the state must make decisions regarding a revenue surplus. We learned in the February revenue forecast that $900 million is available on the bottom line after one-third of the surplus was placed in reserve accounts per state statutes. That is 25 percent less than the November forecast projected, leaving us with less immediately available revenue on the that we can apply to tax relief (such as eliminating the state tax on Social Security checks) and passing a long-term transportation plan.

Transportation

Last session the House passed a 10-year, $7 billion transportation plan using our surplus, bonds and rededicating current revenue from transportation-related sales taxes. Unfortunately, the insistence by some that we raise the gas tax by at least 16 cents per gallon stalled that proposal.

The House's plan remains in a conference committee and is still ready to move at any time. A key provision in that Roads and Bridges Act is legislation that would direct tax dollars we already pay when purchasing auto parts and services toward roads and bridges. While bonding is an important piece in conducting projects on roads and bridges, my proposal would provide a stable, ongoing source of revenue.

Last year, we did pass $12.5 million in transportation funding specifically for small cities (fewer than 5,000 residents). If we pass the full House Republican transportation plan, it would mean more than $27.5 million more for the small cities roads program, translating to $285,670 for small towns in District 18A alone every two years.

Taxes

The House also in 2015 passed a tax bill which would have provided $2 billion in tax relief, only to have that package stall in late-session negotiations. Surplus funds breathe new life into some of these provisions in 2016. As I said, we should start by ending Minnesota’s practice of taxing our seniors’ Social Security retirement benefits. We also should work to lower property taxes for families and small businesses, along with providing relief for farmers who face razor-thin margins and a contracting ag. economy.

Long-term care

One of our biggest accomplishments in 2015 was a comprehensive nursing home rate payment reform that greatly aided our nursing homes in Greater Minnesota. It was the most comprehensive nursing home funding reform in 30 years, including $138 million in new funding. The key thing is this revenue is not dedicated, meaning the local facility can determine how to best use this income, whether it's to increase staff wages, buy new equipment, or make property enhancements.

This year, House Republicans unveiled the CARE Act, a package of proposals aimed at improving the quality of life for Minnesota's aging adults. In addition to phasing out the state income tax on social security, the CARE Act offers individual-empowering approaches to saving for the future like providing flexibility with life insurance policies.

Bonding

Even-numbered years are when the Legislature typically assembles the most significant capital investment bills to pay for construction projects throughout the state. Whatever bonding bill takes shape in 2016 will be on top of a $373 million package approved in 2015. As was the case with the 2015 bonding bill, the focus in 2016 should be on nuts-and-bolts infrastructure projects such as local roads, bridges and water/sewer lines.

 

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