Omnibus state government finance bill calls for General Fund spending cuts

UPDATED: 11:24 p.m. with committee action

Encouraging efficiencies and doing more with less are two priorities of the omnibus state government finance bill.

Sponsored by Rep. Sarah Anderson (R-Plymouth), HF495, with a delete-all amendment, checks in at nearly $902.64 million in General Fund spending, a cut of $67.4 million from current state agency level funding.  

In a statement, she noted that state government spending has irresponsibly increased three times faster than economic growth. “This omnibus bill right-sizes government with commonsense reforms including limiting future commissioner pay raises, freezing full-time equivalents (FTEs), and streamlining government.”

Approved late Wednesday by the House State Government Finance Committee on a split-voice vote, the bill now goes to the House Ways and Means Committee.

“Though making these changes is difficult … it puts our priorities in line with what the public expects us to do,” Anderson said just before the vote. “They’re expecting that we use their tax dollars wisely and we focus on the priorities of the state, and that’s what this bill hopes to do.”

“I strongly oppose the bill because of the draconian cuts to state agencies and state employees,” said Rep. Sheldon Johnson (DFL-St. Paul).

More than half of the proposed reduction — $36 million — would be a one-time reduction in state contribution to the Public Employees Retirement Association for Minneapolis pension reimbursement. Anderson said a recent actuarial report indicated that reducing the state share would still keep the fund on solid footing, in part, because the employer share doesn’t change and less overall money is needed for the fund.

Other base General Fund reductions include:

• $4.14 million to the Department of Administration;
• $3.47 million to Minnesota Management & Budget;
• $3.05 million to the House of Representatives (and a one-time $3.94 million reduction in carryforward funds);
• $2.89 million to the Office of the Attorney General;
• $2.26 million to the Senate (and a one-time $1.72 million reduction in carryforward funds);
• $878,000 for public television;
• $866,000 to the Office of the Secretary of State;
• $438,000 to the Office of the Governor;
• $436,000 to the Human Rights Department; and
• $214,000 to the Campaign Finance and Public Disclosure Board.

 MORE: View the spreadsheet

There is no new funding for the under-construction legislative office building, and debt service and construction costs of the accompanying parking garage are to be paid by those using the facility. Fees would not be charged in the garage for disability parking.

What would HF495 do?

Fiscal, revenue and local impact notes would become the jurisdiction of the Office of the Legislative Auditor. Minnesota Management & Budget prepares them now.

The bill would limit the number of full-time equivalent executive branch agency employees at 35,927. Any staff reductions should prioritize protecting client-facing health care workers, corrections officers, public safety workers and mental health workers. Agencies would be permitted to offer early retirement incentives as a means of achieving compliance. Those incentives would include the state continuing to make the employer contribution `for health insurance after the employee has terminated state service.

Rep. Sarah Anderson

Earlier this session, the governor created a kerfuffle by doling out nearly $803,000 in pay increases — ranging from $22,407 to $35,475 — to state agency heads. They were ultimately reined back in by the Legislature, although the governor can still make the change on July 1, 2015, without legislative consent. The omnibus bill allows for potential raises, but they could not exceed the lesser of the percentage increase over the past 12 months in Minnesota median household income or the consumer price index.

Changes would be forthcoming to the Metropolitan Council, the self-described “regional policy-making body, planning agency and provider of essential services” for the seven-county Twin Cities metropolitan area. Currently, the 17-member board is appointed by the governor and serves a term concurrent with the state’s top elected official.

The bill calls for staggered member terms, including a provision to stagger the terms of current members. Additionally, members would need to be an elected city council member, mayor or county commissioner. The chair would be elected by the other 16 members of the council, rather than appointed by the governor.

With a goal of improving economic and social conditions of its constituency, three of the state’s four ethnic councils would be revamped and renamed as the Minnesota Council on Latino Affairs, Minnesota African Heritage Council and Council on Asian-Pacific Minnesotans. Each council would have 15 members: 11 appointed by the governor and four legislators. Additionally, the Legislative Coordinating Commission would be charged with appointing an executive director for each council by Nov. 15, 2015. Current executive directors may apply. Each director is now appointed by the respective council.

No members of the Metropolitan Sports Facilities Authority would be permitted to receive a salary. Members could still get per diem and expense reimbursement.   

A healthy eating, here at home program would be established to provide incentives for low-income Minnesotans to use federal Supplemental Nutrition Assistance Program benefits for healthy purchases at Minnesota-based farmers' markets.

Hennepin County would be permitted to prevent condemnation of county property by a railroad company through eminent domain if the county determines public safety or first responder access would be negatively impacted as a result.

A number of racing commission policy and technical changes are included in the bill, including eliminating the requirement for 25-week season that begins before the first Saturday in May and raising the ceiling on fines related to horse racing of commission rules from $2,000 to $5,000.

The 15-member Legislative Commission on Surrogacy would be created to develop recommendations on public policy and laws regarding surrogacy.

Free rehearsal and storage space must be provided in the Capitol Complex for the Minnesota State Band, which operates as a nonprofit organization with an all-volunteer membership.

Veterans

The bill would provide qualified military members, their spouses and retired military members who honorably left service within the previous two years to receive expedited, temporary licenses in the areas of optometry, podiatry, dietetics and nutrition, family and marriage therapy, professional counseling, professional clinical counseling, alcohol and drug counseling and barbering. Each temporary license would be for six to 12 months. A temporary licensee would need to meet state standards to earn a permanent license.

The Honor and Remember Flag would be designated as a symbol of our state’s concern and commitment to those who have lost their lives while serving in the armed forces.

A reclassification program would be established “to provide a bonus to eligible members of the Minnesota National Guard who complete training that results in the award of a new military occupational specialty or air force specialty code in specialties that are identified by the Adjutant General to be necessary for the enhanced readiness of the Minnesota National Guard.”

The Department of Veterans Affairs must verify that a business is owned by a veteran before the Department of Administration certifying the business as a veteran-owned small business.  

What’s in the bill?

The following are selected bills that have been incorporated in part or whole into the omnibus state government finance bill:

• HF146 (Dettmer)
• HF352 (S. Anderson)
• HF437 (Scott)
• HF456 (Howe)
• HF506 (Schoen)
• HF649 (Urdahl)
• HF744 (Gunther)
• HF795 (Mack)
• HF859 (Kresha)
• HF1261 (Kresha)
• HF1359 (Anzelc)
• HF1467 (S. Anderson)
• HF1470 (Smith)
• HF1793 (Loonan)
• HF1805 (Nash)
• HF2130 (Mariani)