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Supplemental budget coming together one piece at a time

Rep. Jim Knoblach leans in to confer with Sen. Richard Cohen, co-chair of the supplemental spending bill conference committee, during an afternoon meeting May 21. Photo by Paul Battaglia

UPDATED at 2:16 a.m.

In the waning hours of the legislative session, lawmakers are beginning to come to agreements on the supplemental budget.

House Republicans had originally proposed almost no supplemental budget spending, reserving the bulk on the state’s projected $900 million surplus for transportation projects and tax relief. The Senate DFL and Gov. Mark Dayton, in contrast, had both proposed spending more than half of the surplus on supplemental budget items.

One article at a time, lawmakers began to reach compromises on the supplemental budget. The conference committee on HF2749, the supplemental budget bill, began meeting early Saturday afternoon and adjourned early Sunday morning after adopting articles as agreements are reached. Sen. Richard Cohen (DFL-St. Paul) and Rep. Jim Knoblach (R-St. Cloud) chair the committee. Conferees are scheduled to resume their work at 7 a.m. Sunday, taking up energy, equity and human services.

Here are the agreements that have been reached so far.

 

E-12 Education: $88 million

Voluntary pre-kindergarten is the big-ticket item in the proposed E-12 education budget agreement with a $25 million supplemental budget expense. The rest of the approximately $53 million in appropriations for a wide variety of programs would be offset by a provision allowing school district early repayment of maximum effort loans to the state.

Other funding included in the proposed budget includes:

  • $12 million for counselors on other support staff;
  • $4.9 million to extend an equity increase to non-metro school districts;
  • $4.5 million for staff development;
  • $3 million for the Northwest Regional Partnership;
  • $2.8 million for grants for student teachers in shortage areas;
  • $2.75 million for Positive Behavioral Interventions and Supports;
  • $2 million for parent-child home visiting;
  • $2 million for teacher loan forgiveness;
  • $2 million for the Parent Aware rating system for early education programs; and
  • $1.5 million for “grow your own” programs for paraprofessionals.

“I think we worked very well together in a short period of time,” said Rep. Jenifer Loon (R-Eden Prairie), who chairs the House Education Finance Committee.

All of the governor’s “signature” pieces are in the proposal, said Sen. Chuck Wiger (DFL-Maplewood).

“We reached agreement on a lot that we can proudly go forward on,” he said. 

 

Broadband: $35 million

A contentious issue since the beginning of the session, the Border-to-Border Broadband Plan may have finally reached a compromise for its funding.

The often-debated original House proposal saw a $15 million appropriation in Fiscal Year 2017 and $25 million in Fiscal Year 2018 to fund the program. Gov. Mark Dayton has requested $100 million in his supplemental budget. A Senate proposal came much closer to meeting that request, appropriating $85 million in Fiscal Year 2017.

Under the budget agreement, the program would receive $35 million in Fiscal Year 2017. Of the appropriation, no more than $5 million would be used to serve underserved areas, and up to $1 million may be used for administrative costs; $500,000 could be awarded to expand availability to areas that contain a significant portion of low-income households.

“This was a leadership interest on both sides, and I am pleased with the compromise at this time,” Sen. Matt Schmit (DFL-Red Wing) said.

As one-time appropriations, funds would work to further provide high-speed Internet access to Greater Minnesota by furthering availability, testing accuracy and deploying development.

By no later than 2022, the program would be required to reach all Minnesota businesses and homes who lack access to wire-line broadband service at speeds of at least 25 megabits per second download and three megabits per second upload.

By 2026, all businesses and homes would be required to have access to speeds up at least 100 megabits per second download, and 20 megabits per second upload.

 

State Government: $28.6 million

A pair of items at $10 million apiece make up the bulk of supplemental state government spending.

One item is a modification and extension of Minnesota’s Angel Investment Credit, which provides qualified investors in certified small businesses with a refundable income tax credit equal to 25 percent of their investments up to a maximum of $125,000. The credit, scheduled to sunset after tax year 2016, would be extended for one year.

The other $10 million investment is for the Mighty Ducks Ice Arena Grant Program, which, in part, aims to improve air quality at the state’s indoor ice arenas, including the elimination of R-22 in refrigeration systems. By 2020, the refrigerant chemical used to make ice will no longer be manufactured or imported into the United States.

Other spending includes:

  • $3 million to improve the long-term sustainability of the judges retirement plan within the Minnesota State Retirement System that is only 53.3 percent funded and projected to decline over time;
  • $2 million to enhance cybersecurity across state government;
  • $1.3 million for tax refund fraud protection;
  • $250,000 for a disabled veterans interim housing study;
  • $248,000 for National Guard security improvements; and
  • $148,000 continue implementation of the State’s Olmstead Plan that aims to ensure people with disabilities are living, learning, working, and enjoying life in the most integrated setting.

 

Jobs and Economic Development: $27 million

While most of the funding under jobs and economic development goes to broadband, the budget proposal also contains funding for the following:

  • $10 million for 21st Century Fund investment;
  • $4.5 million for the Minnesota Film and TV Board; and
  • $3.65 million for the Mille Lacs Lake economic relief program.

With a net target of $5 million in addition to $35 million for broadband, much of the new jobs spending is offset by more than $20 million in reductions from the Investment Fund and Job Creation Fund.

Rep. Pat Garofalo (R-Farmington) praised Cohen and Senate Majority Leader Tom Bakk (DFL-Cook) for their “statesmanship” in working on the compromise.

“I think this is a good bill that members on both sides of the aisle can be proud of,” he said. 

Equity proposals will be grouped in a separate article, Cohen said. 

 

Judiciary/Public Safety: $24.85 million

The final number for judiciary/public safety is almost evenly split between the Senate’s $45.35 million increase proposal entering the conference committee and the $793,000 decrease proposed by the House.

Of the amount in the final product, $10.44 million is for employee compensation at the Department of Corrections, to cover most of the department’s request for funding negotiated contracts and increased employer-paid insurance.

The plan calls for nearly $5.37 million to expand the Challenge Incarceration Program by 75 beds, and $406,000 for additional program officers. With a goal of lowering an offender’s risk for recidivism, programming includes an intensive boot camp and intensive, close supervision in the community. Following successful completion of all three phases, offenders are placed on supervised release for the remainder of their sentence. 

Reimbursement for serving on a jury would increase under the proposal, which calls for a doubling of juror per diem from $10 to $20 a day ($953,000) and doubling juror mileage reimbursement from 27 cents to 54 cents per mile ($594,000).

Other proposed funding includes:

  • $1.85 million for Corrections Department information technology critical upgrades;
  • $1 million for grants to secure courthouses;
  • $878,000 for additional Guardian ad Litem staff for compliance with state and federal mandates;
  • $820,000 in sex trafficking investigation grants;
  • $650,000 for six additional forensic scientists at the Bureau of Criminal Apprehension; and
  • $375,000 to provide around-the-clock nursing at the women’s prison in Shakopee.

 

Environment and Natural Resources: $19.32 million

The agreement calls for the Department of Natural Resources to receive $16.70 million in appropriations and the Pollution Control Agency $2.62 million.

Among those appropriations is $4.4 million for the DNR to cover anticipated legal costs from the ongoing permitting process for the proposed PolyMet mining project in northern Minnesota.

The appropriations also include:

  • $5.1 million for parks and trails;
  • $1.15 million in SCORE and recycling grants;
  • $1 million for state forest reforestation;
  • $1 million for the Prospectors Trail in northeastern Minnesota; and
  • $670,000 for purchase of a DNR helicopter.

 

Higher Education: $5 million

Under the agreement, an additional $5 million would be spent on higher education over the biennium, including appropriations to the Office of Higher Education, the University of Minnesota and the Minnesota State Colleges and Universities system. The proposed budget includes the following items:

  • $2 million for state grants to low- and middle-income students;
  • $800,000 for health training restoration at the university;
  • $570,000 for operating support at MnSCU;
  • $500,000 for an equity and opportunity initiative through the OHE;
  • $500,000 for an online system connecting students and employers;
  • $200,000 for open textbook initiatives at MnSCU; and
  • $100,000 for a collegiate recovery program at the university’s Rochester campus. 

“It’s all about students,” said Rep. Bud Nornes (R-Fergus Falls), who chairs the House Higher Education Policy and Finance Committee. “I think we’ve spent the $5 million wisely.”

Sen. Terri Bonoff (DFL-Minnetonka), who chairs the Senate Higher Education and Workforce Development Committee, acknowledged that university and MnSCU offiicals had requested substantially more in supplemental funding — $34 million and $21 million, respectively — but was “grateful” some resources could be directed to the university systems in a non-budget year.

“Their requests were worthy requests,” she said. 

 

Agriculture: $2.13 million

The agriculture agreement would provide $2.13 million in new spending over the biennium, which would be more than offset by a $6.7 million transfer from the Rural Finance Authority loan fund, as well as the recapturing of $3.1 million in existing avian flu spending.

The proposed new spending includes:

  • $600,000 million for the University of Minnesota to develop a software tool to help veterinarians and producers better understand and protect against pathogen strains that affect poultry and livestock;
  • $500,000 for the university’s Forever Green research program;
  • $283,000 for the university to purchase new Veterinary Diagnostic Laboratory equipment to increase animal disease testing capacity;
  • $250,000 to establish the tractor rollover protection pilot program, which would cover up to 70 percent of costs of installing roll bars on tractors to reduce the chances of injury in an accident;
  • $250,000 for an industrial hemp pilot program; and
  • $250,000 for the Good Food Access program to address disparities in access to healthy foods.

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