Tax bill addition could be key to bonding bill passage

Help for thirsty southwestern Minnesota communities became a last minute addition to the omnibus tax bill — a move that could signal a positive outcome for a proposed bonding bill, HF2490, which is expected to be taken up on the House floor Thursday night.

The Lewis and Clark Regional Water System project that would bring water to parts of southwestern Minnesota, including Worthington and Luverne, became a surprise component to end-of-session negotiations. While partial funding for the nearly $70 million project was supported by the Senate and the governor in their bonding proposals, the House was silent. However, the DFL-controlled House had their eyes on several key Republicans from that area to add the needed votes to get a bonding bill passed.

Rep. Ann Lenczewski

Thursday’s amendment, which is expected to be added to the conferred tax bill tonight, would provide $45 million in local bonding authority, with the local governments responsible for one-third of the debt service, while the state would be responsible two-thirds. Authority for the communities to use a half-cent sales tax to fund the issue is also included. The project’s funding is expected to be completed with a $22 million from the so-called cash bonding bill, HF1068, also expected to be taken up on the House floor tonight.

Rep. Ann Lenczewski (DFL-Bloomington) and Sen. Rod Skoe (DFL-Clearbrook), the respective tax committee chairs, sponsor the omnibus supplemental tax bill, HF3167*/SF2726. Lenczewski said the Lewis and Clark project will not change the $103 million bottom line of the conferred bill and that project funding could come from money targeted for local government aid in later bienniums.

The project, which would pipe water from the Missouri River in South Dakota to several communities including those in Minnesota, has relied heavily on federal funds since construction began in 2003. About 65 percent complete, the federal government has stopped its funding, according to the project website.

Lenczewski said the water problem is rightfully taken care of in a tax bill, and she defended the last minute inclusion.

“This is a fundamental infrastructure government service which is water. The House feels good as a group where we’ve gotten to with some saying we must do this because the feds pulled the rug out from under these folks. This is the state stepping forward. … I think we will all benefit if this problem is solved once and for all.”

Tax conferees came to agreement on an omnibus bill May 7, but held off on signing the report   — needed before the bill could be moved to the House and Senate floors — in case the bill was needed to carry other provisions.

Besides aid for the Lewis and Clark project, the signature component of the $103 million bill is $45 million in property tax relief for homeowners, renters and those farmers living on their land.