Greetings from the Floor,
The Legislature wrapped up the 90th biennial session last night just before midnight with votes on the 2018 Pension Bill and Capital Investment Bill. Here are details of each bill:
2018 Pension Bill
- $8.2 billion reduction in unfunded liabilities
- increases employee and employer contributions for all of the various pension plans
- reduces the assumed rate of return from 8.5% to 7.5% for all of the various pension plans
- reduces Cost of Living Adjustments (COLAs) for most of the various pension plans and repeals COLA triggers for all of the various pension plans
- $27.1 million in state aid for some of the various pension plans
I voted for this bill. There has not been a pension bill in three years, and this bill has agreement from the Legislative Commission on Pensions and Retirement, Governor Dayton and the Senate (the Senate voted to approve the bill 66-0).
Capital Investment Bill
- total of $825 million in General Obligation Bonds
- $80 million in Housing Appropriation Bonds
- $416.6 million in Trunk Highway Bonds
- $143.8 million in Appropriation Bonds for Environment and Natural Resources Trust Fund projects
- $6 million for the 20/21 Street underpass
- $628,000 for Weld Hall at Minnesota State University of Moorhead
- $20 million for flood mitigation projects
- $129 million in total project funding for the Minnesota State system
- $79.4 million in total project funding for the University of Minnesota system
- $64.3 million for the Public Facilities Authority for water treatment plant upgrades around the state
I voted for the Capital Investment Bill to fund our local projects. I was disappointed the bill did not become any larger to address more projects around the state. The state does have the debt service capacity to fund around $3 billion in General Obligation bond projects. Passing smaller bills like this only pushes funding for critical infrastructure down the road and adds to the price of projects as construction costs increase over time. Items I would like to have seen addressed better were first and foremost the Clay County Resource Recovery project, more higher education projects and additional funding for the Public Facilities Authority.
On Saturday, the House passed a Supplemental Budget Bill Conference Committee report. I felt that the conference committee report came back better than when the individual bills left the House floor. Most of the controversial policy items were taken out the conference committee report (requiring legislative approval for the Department of Agriculture’s groundwater quality/nitrogen rules and enhanced penalties for protestors). I voted for the bill to provide funding to the Personal Care Attendant organizations to prevent a 7% cut and for $20 million in safe schools revenue. The bill also includes $15 million for the Office of Broadband Development (with no earmarks for satellite internet services), and $3.5 million for the Minnesota State system. Although I think we need to do better in funding both of these items, and the University of Minnesota did not receive any funding, these are steps in the right direction.
Yesterday the House passed the conference committee report for HF 947. This was the Tax Bill Governor Dayton previously vetoed, along with $50 million in one-time funding for school districts. I would like to have seen more attention in tax policy toward tax cuts for individuals, as opposed to corporate tax cuts. However, I did vote for the bill as people need certainty around federal tax conformity before next year. I also appreciated the new education dollars even though it is one-time money.
Several other General Register bills were passed off the House floor last week. The most notable of these bills was to put a constitutional amendment on the ballot in November, 2018 to move money generated from the sales tax on auto parts from the General Fund to the constitutionally dedicated fund for transportation. I did not vote for this bill for a couple of reasons. First, it does not present the comprehensive funding Minnesota needs to keep up with road and bridge maintenance. The plan would be phased in over five years, and after the fifth year $313.6 million would go from the General Fund to the constitutionally dedicated transportation fund. The Minnesota Department of Transportation estimates $600 million a year is needed for road and bridge maintenance. Second, the plan does not provide any new revenue. It only shifts around existing revenue. A couple of years ago, the Speaker of the House, Senate Majority Leader and Governor Dayton all agreed to increased tab fees as a way to better fund transportation. This demonstrated a clear agreement that new revenue is needed (but was never provided). Third, the plan would effectively pit roads and bridges against all other needs in the state. I view this plan as nothing more than divisive politics. It would force a divide between people (education, health care, senior care, economic development, etc.) and transportation. The bill did pass the House; however, it never even came up for a vote in the Senate.
I would sum up this year’s legislative session as a mixed bag. We passed the Capital Investment and Pension Bills which are very good for the state of Minnesota. However, much work was left undone. The Legislature did not adequately address the opioid epidemic or elder abuse. I recognize that governing takes compromise, and I think good compromises were reached on the Tax and Supplemental Budget Bills; however, there is more work to do to properly address all of the pressing needs for the state.
Thank You for the Opportunity to Serve,
Ben