Legislative Update

The following information was shared with the library community via the MLA and ITEM Legislative Update Newsletter Monday, March 19, 2018 by Sam Walseth, Capitol Hill Associates, in his role as the MLA-ITEM lobbyist.

Governor’s State of the State Address
Wednesday night (March 14) Governor Dayton delivered his final state of the state address. He reflected on his two terms in office and thanked Minnesotans for their support in giving him the opportunity to serve two terms. He noted several statistics about where the state was financially when he arrived and where the state is today. In terms of education funding he said Minnesota had fallen into the bottom half of states for funding when he arrived and is now ranked 18th.

He touted the advancements in early childhood education funding and said 80,000 kids today are participating in all day kindergarten and PreK programs because of the investments he pushed for. He talked about the value of our workforce in the eyes of the business community and noted a statistic that says Minnesota is the third best state for business.

He talked about fiscal stability for the state budget and urged legislators to not dedicate auto part sales tax revenues for transportation as that would siphon off over $1.3 billion from the general fund in the next four years.

Dayton wants to allow Minnesota’s to buy into MNCare for health insurance coverage. He said Minnesota’s uninsured rate has risen from just over 4% in 2015 to just over 6% today. He talked about gun violence and the need to listen to the children begging for safety measures.

On the issue of conforming Minnesota’s tax code to the new federal law, he said corporations received enough help and Minnesota needs to focus on tax fairness for families. Lastly, he said our future workforce will come from people outside of Minnesota and while that’s hard for some to grasp, it’s a fact of life and we need to be more welcoming of new people to our state.

He indicated that we should expect details of his supplemental budget proposal by Friday. Legislative committees are planning to review aspects of his plan in their respective committees next week.

Governor’s Supplemental Budget
Last Friday (March 16) Governor Dayton released a supplemental budget plan that would leave his mark on the state’s budget for years to come. In the big picture, Governor Dayton wants to revisit several tax provisions he opposed last year yet signed into law. Namely, last year’s repeal of the automatic inflators on the statewide business levy and the inflators on tobacco taxes are targets in his supplemental budget plan. On spending, he would spend $227 million of the $329M surplus projected for the current biennium, raise another $20 million in tax revenue and keep $123 million on the bottom line for the budget reserve/cash flow account.

In the next biennium, his supplemental budget proposal would increase state revenue by $580 million and would spend $555 million. E-12 programs are a major recipient of the new spending he’s proposing. Making permanent the newly enacted School Readiness Plus early learning program is a top priority for the Governor and Commissioner Cassellius. The Governor includes a bump in special education funding and of course his previously announced school safety plan is also included. The Governor’s plan also includes state funding to pay for the omnibus pension bill that is starting to work its way through the process.

There’s a small change in the E-12 budget that is of direct interest to library services. The Governor’s supplemental budget plan calls for capturing and repurposing unspent Regional Library Telecommunication Aid (RLTA) funds. The MDE estimates that $350,000 each biennium will go unspent from the current $1.2 million annual appropriation. The plan calls for shifting these dollars into the school Telecommunications Equity Aid (TEA) program. We’re working to learn more about this situation.

On the whole, the Governor’s plan will meet resistance from the GOP majorities in the legislature. Dayton’s position that Minnesota should detach from the federal tax code is in direct opposition to GOP efforts to conform Minnesota’s tax code to the recent federal tax bill. This sets up for gridlock as we head deeper into the 2018 session. Details of his plan will emerge this week as committees dig into his plan.

To see agency detail of the Governor’s supplemental plan go here:
https://mn.gov/mmb/budget/currentbud/gov18-19/
https://mn.gov/mmb/assets/18-19-supplemental-budget-agency-item_tcm1059-330545.pdf

Hearing on HF 1484–Bonding
Thursday afternoon the House Education Finance committee reviewed HF 1484
that appropriates $10 million for the library construction and renovation
grant program.

Chief author Rep. Jeff Howe (R- Rockville) introduced the bill and gave a
brief history of the program and how it’s structured. He thanked Rep. Mary
Murphy for her longtime support of libraries and then asked his two
testifiers from Kimball, MN to talk about their local effort to build a new
library.

Kimball Mayor Tammy Konz and Margaret Arnold, a library friend and leader of
the Kimball library building task force, shared the vision and effort
they’re undertaking to build a new library. Their presentation was well
received and several committee members referenced library projects that had
been funded in their communities through this grant pool.

Library construction and renovation grants would be funded through the
bonding bill, so the Education Finance committee’s work today is just the
start. We likely won’t see a formal version of the omnibus bonding bill
emerge until very late in session.