Dear Neighbor,
The 2014 session is at its midpoint and spring finally has sprung. Here is a quick look at some of what has taken place in St. Paul this year as we awaited the robin’s return.
OMNIBUS TAX BILL
The House passed a 436-page bill (HF 3172) that spends $323 million of General Fund money in 2014-15 and $892 million in 2016-17. It fully funds the 5-percent rate increase for disability care workers, puts $58 per pupil on the basic formula for K-12 education, increases penalties for sex offenders and repairs potholes among other expenditures. But it also comes with a $1.2 billion price tag just one year after all-funds spending increased by $1,500 for every man, woman and child in Minnesota.
TAX ADJUSTMENTS
Legislation which passed this session (HF 1777) brings Minnesota’s tax code into line with some provisions of the federal tax code in tax year 2013. It also includes other major provisions starting in 2014. This tax bill repeals last year’s new sales taxes on commercial/industrial repair, warehousing and telecommunications machinery and equipment. The whole package sends $443 million back to taxpayers and puts $150 million in budget reserves.
PROPERTY TAXES
Another bill (HF 3167) recently received overwhelming support in the House, sending $103 million back to taxpayers this biennium and $108 million in the next. Much of this is through property tax relief. For example, the homestead credit refund (formerly called the Property Tax Refund) for property taxes payable in 2014 is increased by 3 percent and the renter's credit is increased by 6 percent. Several amendments offered by Republicans were included.
SENATE BUILDING
A new $90 million Senate office complex that has been the subject of much public criticism was approved by the House Rules committee. Of chief concern is the way this project did not make its way through the traditional legislative process where the public can participate.
MINIMUM WAGE
House File 2091 passed and will increase the state minimum wage from $6.15 per hour to $9.50 per hour for large employers (gross sales over $500,000 annually) and $7.75 per hour for small employers (gross sales under $500,000 annually). The increase comes in three stages, and will reach the new minimums by August 2016. Current federal minimum wage is $7.25 per hour. It is worth noting that a House-Senate stalemate on how high to raise the minimum wage was broken just after a House committee passed the Senate’s office building plan.
BULLYING
The House passed the final form of an anti-bullying bill, approximately one year after it first cleared the House and then stalled in the Senate. A key point of contention surrounded whether we are best served by having local parents and officials make decisions, or if a state bureau was necessary.
MNSURE
MNSure’s Legislative Oversight Committee met after news outlets confirmed Gov. Mark Dayton and his top advisers knew that major problems existed with the program prior to its Oct. 1 launch. An investigation by the state auditor’s office is underway to determine the true nature of MNsure’s issues. A wide enrollment disparity between public and commercial plans makes sustainability of MNsure a strong concern for this new program.
BONDING
The biggest headline item the second half of this session could be a bill to pay for construction projects throughout the state. The House proposal is a two-part plan which adds up to around $1 billion. There is $850 million in borrowing and $125 million in cash from the state surplus.
I’ll keep you posted as things unfold. Until then, please stay in touch with me on the issues.
Sincerely,
Bud