Greetings from the Capitol!
We spent most of this week on the House floor, where we received the Democrat majority’s budget bills, including a tax bill that provides revenue for the spending. Here is a snapshot:
TAXES/FEES WOULD COST EACH OF US $550
House Democrats on Thursday approved a $2.6 billion tax increase proposal that will impact every Minnesotan. All Republicans and a few Democrats voted to oppose the measure. The proposal will raise income taxes on nearly one third of Minnesotans – from the very rich to those making $22,000 a year.
The House Democrat plan will also raise taxes on internet purchases, sports memorabilia, cigarettes, and alcohol. The bill also eliminates incentives for charitable contributions, long-term health care and more.
We spent nine hours discussing this bill on the House floor and one thing struck me: The majority contends increasing taxes on cigarettes and alcohol will steer behavior, causing citizens to consume less of each. If that is truly the case, what is the rationale for raising income taxes and eliminating the deduction for charitable contributions? Click here for a brief video where I address this on the House floor.
The proposed burden on Minnesota taxpayers actually rises to around $3 billion when you add new fees the majority is seeking. Our projected state shortfall is $627 million and shrinking, so you can see this tax proposal is more about paying for additional government spending than balancing our bottom line. The total cost is estimated to be $550 per man, woman and child in Minnesota.
Only 9 percent of those who participated in a recent poll agree with an approach which relies on tax increases as the major component to balancing our budget.
HHS BUDGET FAILS SENIORS
The House passed a Health and Human Services budget bill on Monday. It totals $11.2 billion over the next two years and is the second-largest portion of the state budget, ONLY behind K-12 education.
The proposal cuts $150 million from the current forecasted budget. There is a $26 million net reduction in baseline funding for nursing homes and other long-term care facilities. Higher costs would result from a hospital surcharge passed onto patients. Counties may have to raise property taxes to cover for unfunded mandates such as technology upgrades.
It is highly disappointing care for our most vulnerable citizens is not a higher priority for the new majority. They propose $3 billion more in taxes and fees, yet our nursing homes would suffer. The unfortunate reality is these cuts would make it impossible for many homes to keep their doors open.
Both the tax bill and the HHS bill now will go through the conference committee process, where differences between House and Senate versions will be reconciled. I sincerely hope the concerning provisions in the House proposals are eliminated so the final versions are able to gain bipartisan support.
SAFETY FOR CHILDREN'S PRODUCTS
Finally, earlier today we heard two bills dealing with product safety for children. The first bill, HF459, prohibits retailers in Minnesota from selling infant formula, baby food or toddler food that is stored in a container that intentionally contains bisphenol-A. The second bill, HF 458, prohibits retailers from selling any children's personal care products that intentionally contains formaldehyde. I was thrilled with the great deal of compromise that was achieved on both of these proposals and the safety that is ensured for all Minnesota children. Both bills passed with broad bipartisan support.
As always, keep sending me emails with your thoughts on the issues. I also welcome you to participate in an online survey I am conducting, if you haven’t already done so.
Have a good weekend and hope you get a chance to enjoy the spring weather!
Tara