It's crunch time at the Legislature as the clock winds down on the 2016 session. With just 12 days to go, here is an update on what's likely to happen to bring the session to a close.
While the two-year state budget was complete in the 2015 session, and state operations are fully funded through June 30, 2017, much of the discussion continues to revolve around money. While we left session last June with a projected $2 billion surplus through June 30, 2017, revenue forecasts in February indicated the surplus was dwindling dramatically.
Hence, only $900 million remains for the Tax Bill and the Transportation BIll for this last year of the biennium. And, with an economy that is limping along, the concern is how NOT to have a deficit next January when a new legislature is seated. The concern must be fiscal responsibility for the immediate future.
The Senate has issued a Supplemental Budget plan and it includes $600 million in new spending. The governor proposes approximately $700 million in new spending.
The House is proposing no net new spending for the eight major supplemental state budget bills. There are some instances where adjustments take place to direct more money to some areas, but it nets out at zero. The House leaves the $900 million surplus fully available to be split between our top priorities this session: transportation and tax relief.
The completion of a tax bill is one of the top goals in the House this year. A package the House passed last year remains in a conference committee after the Senate failed to act on it. It can be taken up this year and features a phase-out of the state tax on Social Security income benefits, tax relief for middle-class families, college students, veterans, farmers, job creators and innovators.
I am also hopeful that a provision providing debt service equalization for low property wealth school districts (HF 2982) will also be included in the Tax Bill. It will benefit the Centennial School District and many others across the state. I am a co-author of this bill along with many other House members.
Another bill I authored (HF 782) is included in the Tax Bill, and I am working to make sure it remains in the bill through conference committee. This bill closes a loophole at the local government level and allows citizens to have the opportunity for a reverse referendum when their city would use lease revenue bonds to borrow money for capital improvements. This law would empower local taxpayers and increase accountability in local decisions.
Most Minnesotans agree we need to improve our roads and bridges. That said, most Minnesotans also agree they do not want the gas tax to be increased.
A proposal that has been on hold since the House passed it last year helps us make good on both accounts by making roads and bridges a priority.
The House plan directs taxes Minnesotans are already paying on car parts, auto repairs, vehicle leases, and rental cars to a special Transportation Stability Fund. By adding a portion of the $900 million budget surplus and bonding, we could fix 15,500 lane miles of roads and 330 bridges statewide – all without raising taxes.
Senate Democrats take a different approach through their recently unveiled budget proposal, devoting less than 4 percent of the $900 million state budget surplus to transportation. In addition, Gov. Mark Dayton and DFL lawmakers continue advocating for a historic gas tax increase of 12 cents per gallon and expansion of light rail in the Twin Cities area.
It all comes down to priorities and the House is focusing on roads and bridges. Meantime, U.S. Sen. Al Franken and Dayton’s Metropolitan Council chairman have urged legislators to spend state funds on Southwest Light Rail this session. The Metropolitan Council Transportation Committee estimates the total cost of the SWLRT Green Line extension has grown by nearly 50 percent, with initial estimates at $1.2 billion while recent reports state a new cost of $1.77 billion.
I am strongly opposed to spending our tax dollars for such a questionable project. Two provisions I authored are in the House's transportation package. One stipulates light-rail projects cannot move forward without the Legislature providing either funding or approval. The current lack of oversight has allowed for the unfettered expansion of mass-transit projects at an unsustainable pace.
Another transportation provision I authored would make the Metropolitan Council 100-percent accountable for the operating costs of transit instead of passing off 50 percent of those costs to state taxpayers.
Look for more news as these and other issues evolve at the Capitol between now and the Legislature's May 23 date for adjournment. As always, your correspondence is welcome.