Dear Neighbors,
The 2018 legislative session begins this coming Tuesday and I am looking forward to another year representing you and your family in St. Paul.
Last year, the legislature passed a balanced two-year budget that made important investments in the things that matter most to Minnesotans like education, health insurance relief and reform, and roads and bridge improvements. In addition to those important investments, we passed one of the largest tax relief bills in state history that ensures Minnesotans are able to keep more of their hard-earned money. All in all, it was a productive session.
This session we enter the second year of a biennium and I would expect the legislature to focus more of its energies on policy-focused reforms like federal tax conformity and a bonding bill.
Late last year, President Trump signed into law the largest federal tax reform bill in decades. The vast majority of Americans are already seeing the benefits of this tax reform in their paychecks.
Here in Minnesota, the federal tax bill has potential impacts on our state budget. This leaves lawmakers with two options this session: conform to the federal tax code changes or leave things the way they are.
If we do nothing, the process of filing in Minnesota along with compliance and auditing will be a mess. Think like the MNLARS debacle, but with taxpayers’ returns instead of vehicle titles.
If we do conform, Minnesota will experience an increase in tax revenue. Thus, the House Tax Committee will have to take steps to ensure that the increased tax revenue is returned to taxpayers to prevent any type of widespread tax increase.
Simply put, this is shaping up to be one of the major stories of this year’s legislative session.
Along with federal tax conformity, the legislature will be looking at passing a bonding bill this year. Earlier this year, the governor proposed a $1.5 billion bonding package. If a bill does pass, it will be dramatically smaller than what the governor is asking for and focused on transportation and infrastructure.
Additionally, I would expect a fix to the MNLARS debacle to be addressed this year along with more work to continue to bring down the costs of health care for Minnesotans.
Personally, I will continue to do my absolute best to ensure the values and priorities that matter most to you are well represented in St. Paul. Please do not hesitate to contact me if I can ever be of assistance to you or your family. I can be reached by phone at 651-296-4929 or 701-361-1909 or via email at rep.jeff.backer@house.mn.
Jeff