Gov. Mark Dayton vetoed the omnibus tax bill


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. While the project would create hundreds of jobs, he said that, as proposed in the vetoed bill, the host community (Bloomington) would carry too large of a financial burden. “It would be preferable to find an approach, which recognizes the project’s regional and even statewide benefits through statewide, regional or user-generated financial support,” he wrote.

With a vote on a stadium for the Minnesota Vikings set for Monday, Dayton said his quick action is intended also to diffuse attempts to use the tax bill as a bargaining chip to garner votes for the stadium bill.

“I hope the Legislature can separate the issues,” he said.