By Rep. Paul Anderson
Most of the major spending bills have been debated and passed in the House. The last two weeks saw some long floor sessions with numerous amendments being offered, but few actually being accepted. The Health and Human Services bill, for example, had around 90 amendments filed onto it, and most of them were heard but eventually voted down during the seven hours of debate on the bill.
Several bills remain, among which are the Legacy bill, which was slated to be heard a week ago but was pulled off the calendar because of ongoing discussions pertaining to its content. Several items were added to the bill during committee hearings, including a change in the previously agreed-upon split of parks and trails money between the three entities that receive the funding; namely metro parks, out-state parks, and the DNR, on behalf of state parks. Some want the recommendations of the Lessard-Sams Council followed more precisely, while others feel the Legislature should make whatever changes it feels are necessary. Because of this impasse, the fate of the Legacy bill is uncertain.
Another omnibus bill that hasn’t been heard yet is the one pertaining to energy. The bill was put together several weeks ago, but much opposition was raised about certain parts of it, including the solar mandate and accompanying sales tax. Rural electric co-ops and municipal power systems were eventually amended out of several of the most expensive provisions of the bill, but it hasn’t moved very quickly to the floor. One of my colleagues who serves on the Energy Committee said there was a chance the entire bill would be dropped and certain parts of it added to other bills. We’ll see if it shows up on the calendar for this week.
The tax bill passed last week in the House is another example of the huge increases in spending this majority plans on implementing. A fourth-tier income tax bracket is added, along with a fifth bracket that’s supposed to be a temporary tax to pay off the school shift. In all, the bill raises $2.6 billion in new tax revenue. One of the measures contained in the bill that’s gaining attention because of its huge increase is the tax on alcohol. Current state tax on a 31-gallon barrel of beer is around $4, but under this plan it will go up to around $27. When all federal, state and local taxes are figured in, the total tax bite on that barrel of beer will be $54. Compare that to neighboring Wisconsin with its total beer tax of $18, and it doesn’t take a rocket scientist to figure out that our border communities will have a difficult time in keeping Minnesota residents home when it comes time to buy their favorite refreshments!
A key component in figuring tax policy should be one of remaining competitive. This tax bill certainly goes in the wrong direction. The higher income tax brackets, which would make us the second highest in the nation behind only California, make us less competitive with our neighboring states, especially when some of them are considering actually lowering taxes. The 600-percent increase in the tax on beer is too much, and will certainly drive business out of state.
It’ll be interesting to see what comes out of the conference committees that will work on these bills. In several instances, the Senate did not put such large increases in their language. They also did not address higher fees for large water users in their agriculture bill. It’s my hope some of these increases are scaled back.
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