April 13 - 2018

Budget bills are due just one week from today and that means this past week was filled with bill hearings and preparations for end of session. The Governor sent a letter to legislative leaders, outlining his expectations for the remainder of session. The House GOP released their budget targets as well. Budget committees are working hard to finalize any supplemental spending that will take place and what, if any, policy provisions they will include. 

The Governor's tax bill was introduced this week and will be heard next week, in both the House and Senate. After that, both tax chairs will need to release their plan for how to deal with the federal conformity, likely in a significantly different manner than that of Governor Dayton. 
Dayton Letter
Gov. Mark Dayton  sent a letter to legislative leaders this week, outlining his expectations for the rest of the session. In his letter, the Governor said they should address issues where compromise is likely - such as school safety, protecting the elderly, the opioid crisis, and addressing pension deficiencies. He requested that bills relating to these issues get to his desk by the end of the month (this is unlikely to happen).  

With regards to the budget, the Governor repeated that he will not sign any bill that he feels sacrifices the financial stability of the state. Maintaining a positive financial outlook for the state is paramount to this Governor. He also warned against any cuts to state agencies and/or controversial policies being inserted into budget bills.  

Letters like this one are not that surprising and while they are helpful - for some to understand some key issues - the letter is not likely to have a significant impact on the plans of legislative leaders (as is evident in the next story).

House GOP sets Targets
The House GOP released their Budget targets for session this week. The following shows the breakdown of how they intend to spend the $329 million projected surplus.  It does not include specific funding requests but rather, provides an overview for budget chairs on what they are expected to spend within their jurisdiction. 

Taxes:                                              $107,000,000
Transportation:                               $101,000,000
K-12 Education:                                $30,223,000
Health and Human Services            $10,000,000
Jobs and Energy                              $15,000,000
Agriculture:                                            $250,000
Capital Investment                             $8,893,000 ($825 million bonding bill)
Environment                                          $750,000
Higher Education:                              $5,000,000
Public Safety:                                     $7,119,000
State Government Finance:            ($7,000,000)- Reduction
Other Bills:                                       $50,600,000

It should be noted that the Tax Committee target may seem a bit low to those that have been hearing about costs of doing federal conformity. This is because by doing conformity, the committee will actually raise revenue. They will likely use that revenue to reduce the impact on tax payers. This target reflects how much additional money they will need beyond whatever is raised as a result of conformity.

Also note that these targets only reflect the House GOP and are not the targets of the Senate GOP caucus. 

Buffers Proposal is Rebuffed
A proposal released this week by a state board, regarding fines for violating the state buffer law, was quickly shot down by legislators and the Governor. The contentious Buffer strip law passed last year was once again a point of contention when fines of $200-$500 PER FOOT were proposed. Soon after the proposal was released, legislative leaders and the Governor came out in opposition and the head of the board said he expected the proposal to be withdrawn. 

The 'Dual Roles' Challenge Continues
Michelle Fischbach is being sued again, over her dual role as both Lt Governor and State Senator.  The case brought earlier this year was dismissed by the courts, in part because  Fischbach had yet to perform any official duties - in either capacity - at that time. However, at this point in session that bar may now have been met. IF the judge does not dismiss this case I think we can expect it to be heard quickly and will likely be taken as far as the state supreme court. With only 40-some days left in session and the Senate GOP holding just a 1-seat majority, any potential change in the senate membership could have significant implications for an end-of-session that is already looking rocky.

Other Noteworthy Bills
Here are a few of this week's more "interesting", but perhaps less publicized bill introductions:


These are this year's session deadlines:

1st deadline - March 22, 2018 at midnight
2nd deadline - March 29, 2018 at midnigh t
3rd deadline - April 20, 2017 at midnight 

This means that:
Bills must be out of all policy committees in ONE of the two bodies by 1st deadline.
Bills must be out of all policy committees in BOTH bodies by the 2nd deadline.
Bills must be passed out of finance divisions in both bodies by 3rd deadline.

The deadlines do not apply to the House committees on Capital Investment, Ways and Means, Finance, Taxes, or Rules and Legislative Administration, nor to the Senate committees on Capital Investment, Finance, Taxes, or Rules and Administration. Any bill that is in one of these committees - in both bodies - after 3rd deadline is then "still alive". 

It should be noted that a bill is never really dead until final adjournment. Any bill failing to meet deadlines can always be revived by the rules committee.

Combined Legislative Meeting Calendar

What's Next?

The debate over the budget is now beginning to take shape. The House has released their targets, the Governor's tax bill was introduced this week and budget committees in both bodies are in the home stretch of getting their spending provision out of committee by the end of next week.  The Senate does not require formal adoption of spending targets like the House does, but I expect Senate targets will be released early next week.

After hearing the Governor's tax proposal I would expect both the House and Senate to release their own proposal about how to deal with federal conformity. This will be the final and most significant piece of the budget puzzle. Tax bills will still have some time before they reach the floor, as they will typically be the last major bills voted on the floor before Conference Committees begin. 

After next week's deadline has passed, the majority of committees will be finished with holding hearings and the focus will shift to taxes, budget and bonding. 

Thank you for reading,

Cap O'Rourke

Cap O'Rourke
Lobbyist / President
O'Rourke Strategic Consulting

Cap O'Rourke | (612) 483-1863 | cap@orourkesc.com | www.orourkesc.com/
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