Greetings,
We are reaching the end of June, which not only means Independence Day is approaching, but also signals that a batch of new laws is set to take effect July 1 – including a new two-year state budget.
Before we get into highlights of the new budget laws going on the books, I also want to mention that liquor stores statewide will have the option of opening their doors for business on Sundays starting July 2 – as long as local ordinances have been changed to comply with the new state law. Many cities have altered their liquor regulations to allow Sunday sales, but be aware applicatin of this new law may not be universal throughout Minnesota.
As for the new state budget, increased education funding and a historic investments in roads and bridges are two headline items set to take effect.
The new transportation budget is $6.5 billion for 2018-19, with a historic level of existing funds being invested into our transportation infrastructure statewide. There is a $300 million increase in General Fund spending, $940 million in bonding and a $75 annual surcharge on electric motor vehicles set to take effect. Almost $1.9 billion of the transportation funding is appropriated for the construction, reconstruction and improvement of state highways. Additional funds are used for design and engineering work along with construction project management.
The transportation package enacted this year includes legislation I authored which directs taxes already collected on rental cars, leased cars and the purchase of auto parts to roads and bridges instead of the general fund. Combined with bonding, Minnesota will see billions in additional funding over the next decade for road and bridge construction.
The influx of more than $300 million for roads is provided over the next two years, including:
- $16 million for cities under 5,000 citizens
- $102 million for trunk highways
- $48 million for counties
- $15 million for cities
Stearns County will receive $3.7 million in increased funding for road projects over the next four years. As for the small-city funding, here is a sampling of increases in road funding for District 13A towns over the next two years:
- Avon: $27,264
- Eden Valley: $24,412
- Kimball: $22,188
- Paynesville: $43,108
- Rockville: $65,892
The K-12 Education Budget partners more than $1.3 billion in increased funding, 2 percent more to the per-pupil formula each of the next two years that was requested by our school districts, with key reforms. Rocori will receive approximately $980,632 in new funding the next two years, while Albany ($729,449) Paynesville ($409,489) and Kimball ($358,103) are other examples of local funding increases for schools.
While tax changes do not specifically go into effect July 1, the 2017 tax bill delivers $650 million in tax relief to Minnesota families over the next two years, and $790 million in 2020-2021. The following highlights all are in effect for either tax year 2017 (for filings made in 2018), or in calendar year 2018 (the property tax provisions):
- Social security tax relief for nearly 284,000 senior citizen tax returns (single and married filing jointly)
- Property tax relief for small business owners by eliminating the state property tax on the first $100,000 of value on commercial real estate
- An increased child care tax credit so a family of four making $50,000 will get $1,200 more
- A student loan credit that will give 65,000 students an average of a $414 reduction
- A 40% reduction in school levy property taxes on farmland
One side note on the tax bill: Legislation I authored to repeal the law requiring disabled veterans to annually apply for their homestead exemption was enacted. There has been some confusion over how this will be implemented, but here is the bottom line: If you applied for and received the exclusion last time, you automatically automatically will be extended this year without having to re-apply. If you are looking to start receiving this exemption, or for whatever reason did not claim it last time, you will need to apply this year and then can be automatically re-enrolled in future years.
I hope this helps. Complete details of new laws starting July 1 can be found at this link.
Until next time I hope you are able to get out and enjoy local events as we celebrate our great nation’s Independence Day. Have a safe and happy Fourth of July holiday.
Good luck,
Jeff