Friends,
The session is a little over a week old, and we’ve already accomplished quite a bit for Minnesotans.
Just minutes into the 2014 session we acted on Rep. Joe Radinovich’s bill that allocated $20 million in emergency funding for the Low Income Home Energy Assistance Program (LIHEAP).
I don’t need to tell you we’ve been walloped this winter – both by the weather and our propane gas bills.
The combination of the unusually cold winter and a loss of 40 percent of state’s pipeline capacity caused the demand for home heating fuel to spike. In the end, propane that normally sold for $1.70 a gallon in the heating season was selling at over $6 a gallon at the peak of the crisis in early February. Today, the average price of a gallon of propane is around $3.25.
This bill will guarantee that the LIHEAP program doesn’t run out of money before the folks who use it run out of need. Any remaining funds will go right back into the state’s general fund.
This bill was on the Governor’s desk and signed in less than a week. I think this was responsive government at its best.
Budget forecast
We received some great news last week. The Office of Minnesota Management and Budget announced its latest budget forecast, and the state boasts a $1.2 billion surplus for fiscal year 2014-15 – an increase of $408 million more than the November forecast.
This is the strongest structural budget in more than a decade. MMB’s forecast also projects a $2.6 billion surplus in the 2016-17 biennium.
Hard to believe that just a year ago Minnesota faced a $600 million deficit and an $800 million IOU to schools. But the DFL rejected short-term fixes and passed an honestly balanced budget that invested in education, jobs and property tax relief, and we now we’re seeing the dividends. Our schools are paid back, our economy is growing, and we have a large surplus.
The news of the surplus will shape the rest of this legislative session. I want to see much of it dedicated to middle-class tax relief, providing economic opportunity to those who bore much of the burden during the Great Recession.
I’m proud to say the House Tax Committee already passed a $500 million tax relief package, partly by adopting federal tax conformity. By doing so, nearly 1 million Minnesotans will receive some kind of tax relief, including more than 650,000 married tax filers by removing the “Marriage Penalty” from Minnesota’s tax code.
I would also like to see the legislature repeal some of the business-to-business taxes that were passed last session. The House Tax bill would repeal the warehousing and storage services, commercial equipment repair (including farm machinery) and telecommunications equipment.
A promise kept
We just received the results from a couple of reports that studied how the legislation we passed in the 2013 session affected property taxes around the state. I’m happy to report that property taxes will go down this year for the first time in more than a decade.
One study conducted by non-partisan House Research found that homeowners will see a significant decrease in their property taxes. Overall, they will see a $161 million decrease in 2014, a whopping 4.9 percent decrease over 2013.
Small businesses will also see a net property tax decrease of 2.1 percent and renters of 0.1 percent.
Property tax levies are set to increase by $124 million, but that doesn’t take into consideration refunds or the fact that $75 million of the increase comes from new construction or property for homestead and businesses.
Direct property tax refunds are expected to increase by $133 million in 2014. This direct property tax relief passed by the legislature in 2013 will increase direct refunds to nearly 500,000 homeowners and renters.
Bonding
If I’m in St. Paul, I’m lobbying my colleagues to include projects important to our district in the upcoming bonding bill. My No. 1 priority is the Big Lake Area Sanitary District project.
The Big Lake Area Sanitary District project would construct a pressure sewer system and force main to convey sewage to the Western Lake Superior Sanitary District connection in the city of Cloquet. It means an additional 115 homes along Big Lake Road will be able to hook up to the Cloquet force main connection. It is an effective and permanent solution to the issue of failing septic systems around Big Lake.
Sincerely,
Mike