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Capitol Update Report - May 24, 2016

Sarah Psick - Tuesday, May 24, 2016

The 2016 Legislative Session began on Tuesday, March 8th – one of the latest starting dates for a session in recent memory. It was a short session, just over 10-weeks for the House and Senate to complete the legislative business by the constitutional date to adjourn sine die of May 23, 2016.   By Sunday night, the legislature passed two of the four major bills prior to adjourning – taxes and supplemental budget.  As has been reported, the end of the session was not pretty.  There was an attempt to pass a bonding and transportation bill in the final hours, but that went down in flames when the bill was amended in the Senate and the House adjourned sine die before the bill returned for final passage.  The ball is in the Governor’s court to either sign or veto the bills which passed; and, to decide whether or not to call a special session and continue working on the unresolved issues.   

Taxes:  The first major conference committee bill approved by the Legislature was the omnibus tax bill.  The bill was a two-year process because the legislature failed to pass a tax bill in the 2015 session.  This year, the legislature approved a bill which provides $257 million in tax relief over the 2016-17 biennium and $543 million in the subsequent biennium.  The bill includes a first-in-the-nation student loan tax credit; expansion of the child care tax credit; tax deductions and credits for families contributing to 529 savings plans; expansion of the working family tax credit; expansion of tax credits for some veterans; school building agricultural credit; increased local government aid (LGA) payments to cities and counties; and a phase-out of the state general levy that applies to commercial and seasonal properties.  The bill also includes a property tax exemption for the proposed major league soccer stadium, several local tax provisions, and tax abatements for economically distressed business in the Mille Lacs area.  The bill also repeals the annual inflation adjustment on the cigarette excise tax and freezes the current rate which raised objections during the Floor debate.  The bill does not include a plan to establish a paid family leave program modeled after the state’s unemployment insurance program.

Budget:  The supplemental budget conference committee met throughout the weekend and reached agreement on a $187 million bill early Sunday morning.  The bill includes funding for a wide range of programs across all policy areas.  Included in the bill is $25 million for prekindergarten, $35 million for broadband expansion, and $35 million for equity programs.  Other funding was provided for state parks and trails, Mille Lacs area economic relief, human services programs, Mighty Ducks ice arena grants, judges pension plans, increased per diem for jurors, higher education grants, and other program areas.  The bill also included four tax provisions with fiscal costs in the next biennium:  a one-year extension of the angel investment tax credit; exemption of military pensions from state tax; tax credits for families who have a stillborn baby; and elimination of sales tax for modular homes.  Governor Dayton has expressed concern regarding several provisions not included in the bill, but has not indicated whether he will sign or veto the bill as it was passed. 

Bonding and Transportation:  At the eleventh hour, literally – 11:00 p.m. on Sunday night, the House and Senate seemed to have reached agreement on a bonding and transportation bill.  The proposal would have authorized funding through general obligation bonds, general fund appropriations and state transportation dollars for roughly $1.1 billion of public works spending on projects like rail crossing safety upgrades, water infrastructure improvements, higher education needs, parks and trails development, Capitol security upgrades, road and bridge projects, and , many local area projects.  The spreadsheet was distributed to legislators with roughly an hour remaining in the legislative session, but confusion erupted when many legislators had trouble accessing the documents online and printed copies were only available to a few.  The bill was debated in the House and passed, but when the Senate took up the bill there was confusion regarding what many thought was agreed upon language regarding funding of the Southwest light rail transit line.  Language was missing from the bill to give additional authority to local counties to provide the necessary funding.  The bill was amended in the Senate and passed.  However, the bill needed to return to the House for final passage as amended.  Before the bill made it across the street for consideration, the House adjourned sine die and the legislative session ended – without final passage of a bonding and transportation bill.

ere is a link to an article by Don Davis, reporter for Forum Communications Company with a very good look at the chaotic last minutes of the 2016 legislative session:  http://capitolchat.areavoices.com/2016/05/23/tick-tock-tick-tock-last-minutes-of-2016-legislature/

Other Issues:  Several high profile bills succeeded this session including changing to a presidential primary rather than caucuses beginning in 2020; authorization of the use of police body cameras, drug sentencing reform, extended unemployment benefits for laid-off Iron Range workers, and many other issues.  A few prominent issues were not resolved including implementation of the REAL ID act.  The federal government will require REAL ID compliant driver’s licenses to board airplane beginning in 2018, so the legislature could wait until the 2017 session to resolve this issue.

Legislative Retirements:  All 201 legislative seats in the Minnesota House and Senate are up for election this November.  The filing period for office opened on May 17 and runs through May 31.  At the end of the session, the following members have announced they are not running for re-election to the office they currently hold:

  • Senator Teri Bonoff (DFL, Minnetonka)  Running for Congress
  • Sen. Dave Brown (R, Becker)
  • Sen. Barb Goodwin (DFL, Columbia Heights)
  • Senator Alice Johnson (DFL, Blaine)
  • Sen. Jim Metzen (DFL, South St. Paul)
  • Sen. Julianne Ortman (R, Chanhassen)
  • Sen. John Pederson (R, St. Cloud)
  • Sen. Roger Reinert (DFL, Duluth)
  • Sen. Bev Scalze (DFL, Little Canada)
  • Sen. Kathy Sheran (DFL, Mankato)
  • Sen. Katie Sieben (DFL, Newport)
  • Senator LeRoy Stumpf (DFL, Thief River Falls)
  • Sen. Dave Thomson (R, Lakeville)
  • Rep. Mark Anderson (R, Lake Shore)
  • Rep. Joe Atkins (DFL, Inver Grove Heights) Running for Dakota County Commissioner)
  • Rep. Dave Hancock (R, Bemidji)
  • Rep. Tim Kelly (R, Red Wing)
  • Rep. Tara Mack (R, Apple Valley)
  • Rep. Carly Melin (DFL, Hibbing)
  • Rep. Kim Norton (DFL, Rochester)
  • Rep. Tim Sanders (R, Blaine)
  • Rep. Yvonne Selcer (DFL, Eden Prairie)

 The following House members are leaving their House seat and running for the Minnesota Senate:

  • Rep. Carolyn Laine (DFL, Columbia Heights)
  • Rep. Jason Isaacson (DFL, Shoreview)
  • Rep. Jerry Newton (DFL, Coon Rapids)
  • Rep. Dan Schoen (DFL, St. Paul Park)
  • Rep. Erik Simonson (DFL, Duluth)

What’s Next?  Technically, the 2016 legislative session is over and legislators should return home to their families and constituents.  Governor Dayton has not indicated if he will sign, veto or line-item veto the tax and budget bills, but says he will make this decision by the end of the week.  He also has not indicated if he will call a special session to try and pass a bonding and transportation bill.   But, this decision will not be made unless there is agreement with all legislative parties on the remaining issues. 

Capitol Update Report - May 20, 2016

Sarah Psick - Friday, May 20, 2016

Legislative Update as of Noon, Friday, May 20th

The clock is running out on the 2016 legislative session and there is still no agreement on the major issues – taxes, budget, bonding and transportation.  All bills must be passed by midnight on Sunday, May 22nd

Big Picture:  Typical end of session negotiations involve meetings of the Governor, Senate Majority Leader and Speaker of the House; each side will bring other members of their leadership team or subject area experts.  These meetings have been taking place at the Governor’s office,  State Office Building and Minnesota Senate Building – on and off for the past week.  There is a general belief that an agreement is near on the budget, tax and bonding issues; but, that resolving the stalemate on funding transportation and transit will be difficult to reach. 

Conference Committee Activity:  Conference committees have been meeting on the tax and supplemental budget bills throughout the week.   Although there are no budget targets, the tax conference committee has been working and many provisions have been adopted and agreed to by members of the House and Senate.  The supplemental budget conference committee last met on Monday night.  They have adopted “same and similar” policy provisions and need a budget target in order to continue working.  The transportation conference committee has not met this week. 

Many smaller conference committees have also been meeting and working to resolve the differences between the House and Senate on those bills.  These conference committees include:  REAL ID, body camera usage, Legacy funding, LCCMR (lottery proceeds) funding, health policy provisions, agriculture  policy provisions, life insurance, manufactured homes and other issues.

Bonding:  The House released an $800 million bonding bill on Wednesday this week and brought it to the Floor for a vote yesterday.  The bill contained very few “new” projects and focused on asset preservation, infrastructure, repairs, and transportation bonding projects.  As with the Senate, the bill requires a 3/5th majority vote in order to pass.  On the House Floor, the bill received 69 yes votes, short of the required 81 votes needed to pass; the bill previously failed to pass the Senate last week by one vote.  So, in an unusual move, the House and Senate have appointed members to a bonding “conference committee” to review the bills that went to the House and Senate Floors and try to work out an agreement.  At this point, they do not have a target from leadership for the size of a bonding bill.

What’s Next?:  Leadership negotiations will continue throughout the day, there is an urgency for an agreement to be reached at some point today – Friday, because legislative staff will need time to draft final bills once the details have been resolved.  Smaller conference committees will meet to work out the differences on those bills and they will be sent back to the House and Senate for final approval; the big conference committees will meet when budget targets are announced.  At this point in every legislative session things become very fluid, the House and Senate meet on and off throughout the day, and there is a lot of waiting. 

Capitol Update Report - May 13, 2016

Sarah Psick - Friday, May 13, 2016

The clock is ticking on the 2016 legislative session and while the House and Senate have been working to pass bills on a wide variety of topics – telecommunications reform, autocycle regulations, debt settlement services regulation, fence regulation, nutrient wastewater treatment technology and other issues; negotiations on the budget and tax issues have been few and far between.  To date, 31 bills have been passed by the House and Senate, and signed into law by Governor Dayton.  In order to finish on time, Governor Dayton, House Speaker Daudt and Senate Majority Leader Bakk will need to find agreement early next week. 

The Final Four:  The four “big” issues remain to be resolved:  taxes, transportation, bonding and budget.  This is a repeat of where things were at last week and not a lot of progress was made in the last seven days.  Transportation:  The transportation conference committee met this week and an offer was made by the House Republicans in response to the offer from Senate DFLers at the end of the previous week.  The House offer included using the budget surplus to dedicate transportation-related fees and taxes to roads and bridges, trunk highway bonding, Metropolitan Council reforms, and some type of funding for transit.  Taxes:  This week the Senate passed a second omnibus tax bill, in addition to the omnibus tax bill still in conference committee from last session.  One of the main items included in the Senate tax bill is creation of a paid family leave program modeled after the state’s unemployment insurance program.  The House will be working off the omnibus tax bill passed last session. 

Budget:  The supplemental budget conference committee, comprised of House and Senate members, met late into the night several times this past week.  The supplemental budget bill contains 29 articles and funding for all areas of state government.  The conference committee meetings consisted of presentations by non-partisan staff on the spreadsheets and side-by-side documents outlining the differences in policy positions.  The conference committee will likely meet again this weekend to continue working on the policy differences.  Bonding:  At the end of last week, the Senate’s $1.5 billion bonding bill failed to pass on the Senate Floor by one vote, not reaching the required 3/5th majority support.  The House Republicans have set a target of $600 million for a bonding bill, but have not released the proposal to date.  House DFLers have stated they will not put up one vote for a $600 million bonding bill.  The bill also requires a 3/5th majority vote to pass in the House, meaning at least eight DFL members must vote for the bill, together will all 73 Republican members. 

Governor’s Fishing Opener:  Governor Dayton will host the 69th Annual Governor’s Fishing Opener at Big Sandy Lake in McGregor this weekend.  The Governor’s Fishing Opener has been a tradition in Minnesota since 1948.  The event was designed to promote the development of Minnesota’s recreation industry, and in recent years, it has served as a kick-off celebration for the summer tourism season.  According to the Governor’s office, fishing generates an estimate $4.2 billion in direct retails sales annually in Minnesota, supporting 35,000 jobs statewide.  Minnesota has the second-highest angler participation rate of any state in the nation (32-perent).  Dress warm!

Sunday Sales of Liquor:  The issue of whether or not liquor stores should be open on Sunday has become an annual debate at the Legislature.  Minnesota law prohibits two industries – liquor stores and car dealerships, from operating on Sundays.  These laws have been in place for decades.  Recently, efforts from large liquor distillers, “big box” liquor stores and a social media campaign have led the charge to repeal the current law.  On the other side, “mom and pop” liquor stores, municipal liquor stores and others have opposed the change with the belief that increased costs will not be followed by an increase in revenues.  This week, an amendment was offered in the House to give cities the option of allowing liquor stores to open on Sunday.  Again, the legislature defeated the amendment, this year by a vote of 56-70.    

Claim’s Bill:  The Joint House/Senate Subcommittee on Claims was established in 1976 to hear and recommend to the legislature whether or not to pay claims against the state by various persons who cannot proceed against the state under the State Tort Claims Act.  The joint subcommittee also handles other claims that cannot be litigated.  Typically, the joint subcommittee hears a number of claims relating to injuries sustained by prisoners while performing “sentence-to-serve” duties.  This year, the joint subcommittee heard requests from claimants under the “Imprisonment and Exoneration Remedies Act” which was enacted two years ago to create a compensation process for cases where a person was exonerated of a felony for which they were wrongfully incarcerated.  The 2016 Claims bill, HF 3328, provides payments to three Minnesotans who each spent time in a Minnesota prison for crimes they were later exonerated from.  The bill passed the House this week and is awaiting action in the Senate. 

Next Week:  The Legislature will enter the final week of session and have until May 23rd to complete their work.  (Technically, the final day for passing bills into law is Sunday, May 22nd according to the state Constitution.)  All of the “big” issues remain on the table.   If an overall agreement is reached between the leaders, we can expect many long nights as the conference committees meet to work out the details of the bills. 

All members of the House and Senate are up for reelection this fall and on Tuesday, May 17th those interested in running for reelection or challenging an incumbent legislator may begin filing for office.  The filing window runs from May 17 through May 31, 2016.