With dismal job numbers, a recession at the state’s doorstep and a nearly $1 billion deficit projected for the biennium, this year’s House capital investment bill is all about maximizing jobs, federal dollars and other matches.
“We do think of this as a jobs bill to put people back to work,” said Rep. Alice Hausman (DFL-St. Paul), sponsor of HF380, and chairwoman of the House Capital Investment Finance Division.
The $1.06 billion bill, which includes $960 million general obligation bonding, seeks improvements to zoos, planning for or building commuter rail lines, historic preservation, land acquisition for a new state park, and higher education preservation and construction.
“We’re focusing on infrastructure and the jobs that come out of building that infrastructure. We believe that can have a transforming effect on the state,” Hausman said.
Approved 99-34 by the House March 6, the Senate later received the bill, with Sen. Keith Langseth (DFL-Glyndon) as the sponsor, and replaced its language for that of the House. The bill passed 57-9, and it was returned to the House where a conference committee was called to work out the differences.
The spending amount proposed in both the House and Senate measures is close to that in Gov. Tim Pawlenty’s initial recommendation. But the project list varies between the three.
With more than $4 billion in requests from local governments and state agencies, bringing the bill down below $1 billion in general obligation bonding hasn’t been easy, and Hausman acknowledges more cuts may lay ahead.
Traditionally a bonding bill spends around 3 percent of the General Fund. Based on the February Forecast projecting a nearly $1 billion deficit this biennium, the governor recommends lowering the bonding cap to $825 million.
“This is a bill that has to get smaller rather than bigger. The dilemma is that everyone here is an advocate for their communities,” Hausman said.
On the House floor, an amendment successfully offered by Rep. Bev Scalze (DFL-Little Canada) diffused concern that the House bill would come in at more than the 3 percent threshold. Passed 128-4, the amendment affirms the intent that the biennial General Fund appropriation for debt service not exceed 3 percent.
Republicans termed the bill one of “niceties, not necessities.”
“In a time when Minnesotans are hurting financially, the bill is too big,” said Rep. Paul Kohls (R-Victoria). “Ask the question; are the projects in the bill truly critical to regional or state importance?”
Last year the $334 million capital investment bill, which Hausman sponsored, was vetoed by the governor.
While some projects in last year’s vetoed bill are included, such as $38 million for a Duluth arena, it took some “thinking outside the box” for others to make it onto the list. Hausman referred specifically to funding for new bioscience facilities at the University of Minnesota and housing initiatives through the Minnesota Housing Finance Agency. Both propose to use their own bonding authority to secure funding, while the state would cover the debt service payments.
Bonding proposals for environment and natural resources-related spending are a little more than $200 million with the bulk of the money, $135.8 million, targeted to the Department of Natural Resources. Some DNR bonding highlights include:
• $28.2 million for various flood control efforts;
• $18.5 million for state park rehabilitation, development and facility improvements;
• $15.5 million for Lake Vermilion State Park acquisition and development;
• $13.9 million for grants for regional and local parks;
• $13.5 million for acquisition and development of state trails;
• $8 million for wildlife area acquisition and improvement; and
• $5.5 million for grants for regional and local trails.
The Pollution Control Agency would receive $32.5 million, with $25 million from the state’s remediation fund slated for cleanup projects at closed landfill sites, including the Washington County Landfill. Another $5 million in general obligation bonding is for a beneficial reuse of wastewater demonstration project and $2.5 million for remediation systems at the Albert Lea Landfill.
The Board of Water and Soil Resources would receive $39.3 million, with $35 million going to the Reinvest in Minnesota Reserve program to purchase conservation easements. Another $3 million is for wetland replacement and $1.3 million for Clean Water Legacy programs.
Also included is $21.2 million for capital improvements to metropolitan parks, the St. Paul Great River National Park, the Springbrook Nature Center and other projects.
Health and human services
Bonding projects for health and human services would include:
• $4 million for asset preservation, and safety and security of the Moose Lake Sex Offender Treatment Facility;
• $4 million for campus redevelopment for Brainerd Regional Human Services Center; and
• $3.5 million for Hennepin County Medical Center education training room and lab expansion.
The Minnesota Housing Finance Agency would receive $2 million to address long-term homelessness needs by establishing a nonprofit housing bond account within a housing development fund. The agency could then annually issue the bonds for up to 20 years to make loans and to finance construction and rehabilitation of permanent supportive housing. The monies are not included in the governor’s recommendation.
Heritage and culture
Several so-called quality-of-life projects submitted by the House Minnesota Heritage Finance Division include:
• $21 million for upgrades to zoo facilities, including an expansion to the polar bear exhibit at the Lake Superior Zoo, repair and new infrastructure at the Como Park Zoo and asset preservation at the Minnesota Zoo;
• $4 million to county and local jurisdictions as matching money for historic preservation grants;
• $4 million for phase II construction of a National Volleyball Center in Rochester;
• $3 million for a pre-design for Orchestra Hall and Peavey Plaza renovations in downtown Minneapolis;
• $500,000 Historic Fort Snelling asset preservation; and
• $300,000 for the Oliver H. Kelly Farm revitalization near Elk River.
Generally higher education gets the greatest share of a bonding bill, and this year, at $417 million, it’s no different.
Included in the House proposal is more than $136 million for the University of Minnesota to cover the state’s share of several projects, including:
• $48.3 million for a new science teaching and student services building on the Minneapolis campus;
• $40 million in asset preservation;
• $24 million for a new Bell Museum of Natural History on the St. Paul campus;
• $10 million for an addition to the Department of Civil Engineering building at the Duluth campus, and
• $5 million to renovate a community services building on the Morris campus.
The Minnesota State Colleges and Universities system would receive more than $281.4 million, including $60 million in asset preservation. Other projects include:
• $25.5 million for a Trafton Hall renovation at Minnesota State University, Mankato;
• $14.9 million for a Brown Hall renovation at St. Cloud State University;
• $13.3 million for a regional law enforcement training facility at Hennepin Technical College in Brooklyn Park;
• $13.2 million in classroom additions at Inver Hills Community College; and
• $13.1 million for the Lommen Hall renovation at Minnesota State-Moorhead.
Of the $34 million directed to the Department of Education, $32 million would go to complete secondary school construction in Red Lake, and $2 million would be for library accessibility and improvement grants.
Also included is $2 million for pre-design for a new dormitory and asset preservation at the Minnesota state academies and $355,000 in asset preservation at the Perpich Center for Arts Education.
Included in the areas of public safety are:
• $16 million for expansion of the Faribault Correctional Facility;
• $11 million for asset preservation;
• $5 million for a public safety training center at Camp Ripley; and
• $3.66 million for a Southeastern Minnesota regional public safety training center.
The bill also asks the commissioner of public safety to develop a long-term strategic plan to address maintenance and staffing of existing crime labs and for new regional and local crime labs.
The House State Government Finance Division recommended projects totaling $99.12 million. Although the governor recommends $18 million for preserving the exterior of the Department of Transportation headquarters in St. Paul, it is not included in the House recommendation.
After a substantial paring down, projects proposed include:
• $13.4 million for State Capitol restoration; and
• $500,000 for pre-design of a new state emergency operations center.
Funding in the bill looks toward creating a network of rail lines in the Twin Cities metropolitan area.
“Talking line-by-line is almost irrelevant,” Hausman said. “We need to look at the whole area. This all has to do with a system that works together. Most other states and regions are ahead of us.”
The largest chunk is $70 million for the Central Corridor that is designed to link downtowns Minneapolis and St. Paul. It would also be the primary east-west line in the metropolitan area, which would ultimately link together many rail lines. This money would be enough to leverage federal funds for the project, although some additional state money would be needed in next year’s bonding bill. The governor and Senate have proposed the same amount.
The bill also includes $500,000 for things like preliminary engineering, environmental studies or park-and-ride lot construction for the following transitways: Bottineau Corridor, interstates 94 and 494, Red Rock, Robert Street Corridor, Rush Line and Southwest Corridor. The same amount is allocated for work on the Cedar Avenue Bus Rapid Transit Corridor.
The bill also includes $4.5 million to help turn the Union Depot in St. Paul into a multi-modal transit center.
Veterans and military
Of greatest priority to the House Agriculture, Rural Economies and Veterans Affairs Finance Division are the state’s veterans homes. The bill includes $2.8 million to address health and safety issues at the five homes administered through the Department of Veterans Affairs.
Also included is:
• $7.9 million for construction of a 90-bed veterans home in Kandiyohi County;
• $6 million for asset preservation at various National Guard armories in the state, and to bring some armories into compliance with the Americans with Disabilities Act;
• $300,000 combined for veterans memorials in Virginia, Eden Prairie and Richfield; and
• $227,000 for an addition and renovation of the Silver Bay Veterans Home.
Contributing to this article: Courtney Blanchard, Nick Busse, Mike Cook, Craig Green, Tom Hammell, Brian Hogenson and Patty Ostberg.