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Legislative News and Views - Rep. Chris Swedzinski (R)

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News from the Capitol

Friday, February 22, 2019

You could say things were “electric” in St. Paul this week as I visited with representatives of the Minnesota Valley Rural Electric Co-op (above) and the Redwood Electric Co-op (below). I appreciate your input.

Thanks to the people in the photo below who came to my office during a Catholics at the Capitol event this week.

Dear Neighbor,

The big news this week in St. Paul was that Gov. Tim Walz released his budget proposal for the 2020-21 biennium on Tuesday, pulling back the curtain on his priorities for Minnesota. Let’s just say it doesn’t look good, especially for those of us outside the Twin Cities

The key takeaways are that the governor is proposing than $3 billion in tax increases over the next two years alone, and $4.7 billion in tax increases for 2022-23. This includes his push to raise Minnesota’s gas tax by 20 cents per gallon – a 70-percent increase – vaulting Minnesota’s gas tax to fourth-highest in the nation.

Gas tax hurts lower earners most

This regressive increase to the gas tax would be very damaging to people in Greater Minnesota, especially seniors, lower earners and the agricultural industry in general. The burden of the governor’s tax increase certainly would be felt at the pump, but it also would drive up the prices on goods and services we purchase every day. It’s hard to see widespread support for the governor’s tax increases, especially since the state has a substantial budget surplus.

On a quick side note, I am working to compile testimony from people in our area who have compelling stories to share regarding how the gas tax would be damaging to them. Please reach out to me by using the contact information in this email if you have anything to pass along on that subject.

More tax increases Gov. proposes

As for other parts of the governor’s proposal, it also includes increases to tab fees, the motor vehicle sales tax, the metro area sales tax, business taxes, and reinstatement of the sick tax, which is set to expire at the end of the year, adding $1 billion to the cost of health care for Minnesotans over the next two years.

Walz’s proposal also does not extend Minnesota’s reinsurance program, which could cause rates to rise once again by 50 percent or more on the individual market. Instead of extending reinsurance, the governor has proposed a 20-percent premium subsidy only for those who do not receive federal tax credits under the Affordable Care Act.

In 2020-21, the governor’s budget raises general fund tax revenue by $1.2 billion. The extension of the sick tax adds an additional $947 million, with transportation-related taxes adding $907 million for a total tax increase of $3.1 billion. In 2022-23, the tax increases balloon dramatically; the governor increases general fund tax revenue by $1.4 billion, with another $1.5 billion for the sick tax and $1.7 billion in transportation taxes.

Until next time, have a good weekend.