Dear Neighbor,
The House put forward its proposal for a supplemental budget this week and it is much more responsible than what the governor issued in his plans a few weeks ago.
There already is a two-year state budget in place, but in "off years" such as this one, adjustments often are made to fine-tune things.
Just to rehash the governor's plan, his spending increases far outweigh any tax relief and he chews through most of the state's $900 million surplus. He proposes significant tax hikes, including from wholesale gas tax increase and a metro area sales tax increase for transit.
By contrast, the House plan is neutral in terms of spending vs. reductions. Existing spending is shuffled to focus on our priorities. This shows we can reprioritize the existing budget to make improvements instead of simply increasing spending.
The real key to our neutral net is that it preserves the $900 million surplus. Retaining that will allow us to take another look at the House's top priorities: providing tax relief and passing a long-term transportation plan that focuses on roads and bridges.
Bills we passed last year pertaining to both of those subjects remain in conference committees and can advance this session. The transportation plan spends $7 billion on roads and bridges over the next 10 years without raising increase the gas tax. This plan would repair or replace an estimated 15,500 lane miles of road and 330 bridges statewide.
A cornerstone of this proposal directs sales taxes we already pay when purchasing auto parts toward a new roads and bridges account. This is just common sense.
There also are a number of provisions in the tax bill that would help many, many Minnesotans. One important one would phase out the state's tax on social security benefits for seniors. It has never made sense to double-tax that income and we should stop doing it. There also are proposals to end the tax on military pay, provide property tax relief for farmers and small businesses, and more.
This is a far better plan than what the governor proposes. We are waiting for the Senate to come out with its own plan, but you can expect Democrats in that body to be looking for something closer to the governor's tax-and-spend model.
Look for more as things evolve at the Capitol.
Sincerely,
Tom