Dear Neighbor,
With just two weeks left to go, the House passed a series of finance bills this week in St. Paul during several marathon sessions. Now, it's on to conference committees for the following bills which I've summarized below:
TRANSPORTATION
The Road and Bridge Act of 2015 is the major part of House Republicans' comprehensive proposal for transportation in Minnesota. It invests $7 billion over the next decade. Unlike the governor's proposal to raise the gas tax by at least another 16 cents by gallon, the House's plan includes no tax increases, instead dedicating existing tax revenue. Over the next 10 years, the Republican proposal prioritizes repairing or replacing 15,500 lane miles for all roads and 330 bridges statewide. This is accomplished through the following investments:
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$4.03 billion for state roads
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$1.44 billion for county roads
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$583 million for municipal roads
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$282 million for small cities under 5,000
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$139 million for Greater Minnesota bus services
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$60 million for township roads & bridges
K-12 EDUCATION
The House's omnibus K-12 education finance bill spends $16.87 billion, a $1.06 billion increase over current spending. This legislation not only provides more funding for our schools, but also includes important reforms to ensure we're offering all students a quality education. Reforms are in the bill to improve student learning by empowering teachers and schools, providing flexibility to school districts, putting teaching before testing and providing fairer funding. The House prioritizes early childhood learning by increasing funding for early learning scholarships and school readiness aid. This allows us to target our efforts where they are needed instead of taking the governor's one-size-fits-all approach with his universal pre-K proposal.
TAXES
The House Republican Omnibus Tax bill directs $2 billion in tax relief to virtually all Minnesotans. A new Minnesota child or dependent tax exemption would save a middle-class family of four more than $500 over the next two years. The House bill recognizes that, while the state has a projected budget surplus of nearly $2 billion, most families haven't seen surpluses in their household budgets.
Another key component would phase out Minnesota's practice of taxing Social Security benefits. Estimates indicate this provision would provide tax relief in the range of $280 to $600 per person. Minnesota is one of only six states that taxes Social Security. Highlights in the tax bill include:
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2,045,000 Minnesotans would receive relief through a new state version of the personal or dependent exemption equal to 25 percent of the federal exemption.
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366,500 aging adults living on fixed income would receive relief from the phasing-out of the tax on social security.
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240,000 farmers would receive relief through a property tax credit that reduces their disproportionate share of school district debt service.
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130,000 families with pre-kindergarteners would receive relief through the expansion of the education deduction to include pre-kindergarten expenses.
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109,500 college students would receive student loan debt relief through a NEW tax credit for principal and interest loan payments on student loans.
HHS
The House HHS (House & Human Services) finance bill protects the most vulnerable, and expands access to quality, affordable care for all Minnesotans. It gets a handle on skyrocketing costs and reduces layers of redundant government bureaucracy.
In total, the HHS bill spends $11.81 billion. This is a $634 million increase over current spending, but it significantly slows the trajectory of growth in HHS spending which now consumes 29 percent of the state budget – double from just a few decades ago.
As House Republicans look to bring government spending more in line with family budgets, this legislation works to eliminate waste and abuse by no longer paying entitlement benefits for people who do not qualify for them (audits show as many as 17 percent of enrollees are either in the wrong program or altogether do not qualify). The Department of Human Services will be given new authority to detect and collect on the millions of taxpayer dollars wasted on unnecessary or illegal payments.
Most of the House's finance bills are now being worked on in conference committees in preparation for final passage so we can present a formal plan to the governor for his action. There will be many moving pieces between now and May 18, when the Legislature is set to adjourn.
As always, your correspondence is welcome.
Sincerely,
Rep. Linda Runbeck