Capital investment bill on its way to the governor

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The nearly $500 million capital investment bill came back from the Senate with two additional appropriations that the House voted to accept — a $500,000 grant from the Business Development Through Capital Project Grant Program to fund construction of a flood wall in South St. Paul and $2 million to transform the Harriet Tubman Center in Maplewood “to be used as a regional safety service center for domestic violence shelter, legal services, youth programs, mental and chemical health services, and community education.”Repassed 97-33 by the House, HF1752*/ SF1463 now moves to the governor for action.The bill calls for $496.4 million in general obligation bonding to fund road and bridge projects; maintenance work at the University of Minnesota and the Minnesota State Colleges and Universities system; asset preservation projects at various state-owned facilities; and design work for needed repairs to the State Capitol. It is sponsored by Rep. Larry Howes (R-Walker) and Senate Majority Leader David Senjem (R-Rochester). Continue Reading

New tax bill emerges in conference committee

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Fresh off a gubernatorial veto of the omnibus tax bill, HF2337*/ SF1972, the House Taxes Committee chairman said that when it comes to trying to improve the state’s tax climate, “We’re never going to quit.”Rep. Greg Davids (R-Preston), who sponsors the bill with Sen. Julianne Ortman (R-Chanhassen) urged Gov. Mark Dayton to sign HF247*/ SF872, a stripped-down version of the previous tax bill. A House conference committee reviewed the new bill this morning and it awaits action by both bodies, possibly yet today.Dayton’s primary objection to the previous bill was the long-term cost of the bill’s proposed credits. It would have cost the state more than $145 million in the out-years.The General Fund impact of the new bill would be $18.4 million over the 2012-2013 fiscal biennium. The financial hole is expected to be filled by cost savings achieved in other bills passed this session.The cornerstone to the previous tax bill was a freeze on the state property tax levy paid by business property and seasonal property owners. That would have cost the General Fund $71.8 million in the 2014-2015 biennium. Continue Reading

Bonding bills passed in both chambers; conference committee needed

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After a long and winding road, a capital investment bill finally made it to the House floor. The DFL put up a majority of the 99-32 votes to move it to the Senate, which passed it 45-22. A conference committee is expected to work out the differences.Sponsored by Rep. Larry Howes (R-Walker) and Sen. Julie Rosen (R-Fairmont), a delete-all amendment to HF1752*/ SF1463 upped the bonding total approximately $62 million from the bill’s original total of $433.9 million. Howes called it a compromise and part of the end-of-session negotiations. (See the spreadsheet.)Getting a bonding bill to the floor this session has been controversial. Continue Reading

Gov. Mark Dayton vetoed the omnibus tax bill

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Gov. Mark Dayton vetoed the omnibus tax bill, legislation that Republicans say would have addressed their session priority — tax relief for Minnesota businesses to help grow jobs.The governor called HF2337*/ SF1972 “fiscally irresponsible” and out of balance — providing tax relief for one sector while ignoring others. He said that businesses have not been the only ones experiencing an increase in property taxes.“For homeowners, renters and farmers, the bill would not begin to undo the damage from last year’s elimination of the Homestead Credit and cuts in Local Government Aids. I remain committed to broad-based, comprehensive property tax relief for all property taxpayers, including – but not limited exclusively to businesses,” Dayton wrote in his veto letter.Rep. Greg Davids (R-Preston) and Sen. Julianne Ortman (R-Chanhassen) sponsor the bill that would have frozen the state property tax levy paid by business owners and seasonal/recreational property owners. It would have also provided an upfront sales tax exemption on capital equipment purchases for all small businesses; and increased the angel investment credit by $5 million, with special emphasis on Greater Minnesota projects. Dayton objected to the bill’s cost to the General Fund and said that it would add “another $145 million to the deficit projected for the next biennium, which is already projected to be $1.1 billion.”The bill came to his desk yesterday, and Dayton said the quick veto is a signal that he is willing to work with the Legislature on a tax bill that is balanced.Dayton cited bill provisions that would provide a tax increment finance extension to help spur the planned expansion to the Mall of America. Continue Reading

Conferred tax bill passes House and moves to Senate

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A Republican proposal to provide tax relief to state businesses passed the House 75-57, with DFLers characterizing it as “uberpartisan,” and that education would get the short shrift because of how the relief would be funded.When HF2337*/ SF1972 left the House floor for conference committee, it contained a provision to phase out the state property tax levy paid by business owners and seasonal/recreational property owners. The gap in the state coffers would have been filled by reducing the renters property tax credit.A compromise between House and Senate conferees eliminated the provision and opted for the bill’s new credits to be paid by canceling approximately $43.5 million to the General Fund from the budget reserve account. It also changed the phase-out to freezing the base amount.Sponsored by Rep. Greg Davids (R-Preston) and Sen. Julianne Ortman (R-Chanhassen), the bill awaits Senate action.There are several other provisions in the bill directed toward tax relief and grant aid for Minnesota businesses — a session priority for Republicans.They include:an upfront sales tax exemption on capital equipment purchases for all small businesses;increasing the angel investment credit by $5 million, with special emphasis on Greater Minnesota projects;increasing the research and development tax credit by 24 percent for Minnesota companies; andproviding for a veterans jobs tax credit.DFLers positioned the bill as Republicans putting the state’s businesses at the front of the line when it comes to property tax relief.“This is an anti-education bill, putting businesses ahead of education,” said Rep. Mindy Greiling (DFL-Roseville). She pointed to the $2 billion the state owes the schools from previous efforts to help balance the state budget. “When we have that kind of debt to students that we say are our top priority, I don’t think it behooves us to be Santa Claus to businesses.”Rep. Ann Lenczewski (DFL-Bloomington) called the bill “uberpartisanship.”“When I hear it is an uberpartisan bill, it is such nonsense,” Davids countered as he pointed to DFL-sponsored provisions included in the bill. Continue Reading

Rep. Lyle Koenen of Clara City: Complicated road to the Minnesota Senate

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Several House members are planning a run this fall for the Senate. But none has a more complicated road for a seat than former Rep. Lyle Koenen (DFL-Clara City).Because redistricting paired him with Rep. Andrew Falk (DFL-Murdock), Koenen, a five-term House member, opted to run for the Senate seat that opened when Sen. Gary Kubly (DFL-Granite Falls) passed away.Koenen won the April 10 special election, and while he was sworn-in April 18 to serve out Kubly’s term, his future in the Senate remains in question.At the recent Senate District 17 convention, he and another candidate went through a grueling four rounds of balloting before delegates opted for no endorsement, triggering an August primary to determine the district’s DFL candidate. If Koenen wins the primary, he will be on the November ballot.His trek to the Senate actually began before redistricting after the 2000 census. He was serving as the Chippewa County DFL chairman, when he was prompted to run against Republican incumbent Charlie Berg. “No one was running, and I was asked at the last minute ­— just to get my name out,” he said.He was victorious in the 2002 election, and since then has represented an area that has experienced radical change — with district counties seeing some of the greatest population declines in the state. Continue Reading

Presumption of joint child custody

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An emotional debate that crossed party and gender lines had members characterizing a bill to change the state’s child custody laws as “long overdue,” while others termed it “problematic and would negatively affect children for years to come.”Sponsored by Rep. Peggy Scott (R-Andover), HF322 would change current law to a presumption of joint legal and joint physical custody with a minimum of 45.1 percent of parenting time for each parent. A parent is currently entitled to receive at least 25 percent of parenting time. Provisions would be extended to those who are not married, but where parentage has been established.Passed 80-53 by the House, it now moves the Senate where Sen. Pam Wolf (R-Spring Lake Park) is the sponsor.At every committee stop the bill has made over its two-year journey to the House floor, testifiers’ stories have been “heart-wrenching and breathtaking,” Scott said. The current system pits parents in a divorce situation against one another, she said. “It is a contest to see who is the most fit. Continue Reading

Parenting percentage bill going to the House floor

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Heading to the House floor is a bill that would give fathers greater rights in child custody disputes.HF322 would change current law to a presumption of joint legal and joint physical custody with a minimum of 45.1 percent of parenting time for each parent. A parent is currently entitled to receive at least 25 percent of parenting time.It was approved on a split-voice vote by the House Ways and Means Committee.Rep. Peggy Scott (R-Andover), the bill’s sponsor, said custody issues are generally worked out between the couple without court intervention.“Two parents going into to a custody issue will have time to work this out on their own, and if they don’t, then the judge steps in,” she said. “This bill doesn’t say that out of the chute they have to have 45.1 percent parenting time. This bill allows flexibility.”But this is projected to come at a $1.5 million cost to the General Fund in fiscal year 2013 and $4 million in each of the following two fiscal years. The cost reflects the additional court staffing that will be added, according to a nonpartisan fiscal note.“I think this is a small amount of money to invest in making children have as close to equal access to both parents as possible,” Scott said.There will be savings to the state in other ways, she said. Continue Reading