April 20 - 2018

We hit third deadline today, which means that all budget bills must have made it out of both their respective finance committee hearings by now, in order to continue on to the finish line. *See exceptions in the 'Deadlines' block below. 

While budget committees rolled out their supplemental budget proposals, the tax committees in both houses heard the Governor's tax plan.  Not at all surprising, there are a number of policy provisions and appropriations that have have drawn the ire of Governor Dayton. This is all part of the end of session negotiations that will begin in earnest in the next few weeks.

Tax Debate Begins
This week the Governor's tax plan was rolled out. As we might have predicted, it was met with support from DFLers and opposition from the GOP. Of particular concern among GOP legislators is a proposed reinstatement of the Provider Tax which was set to expire. Dayton is also renewing his call to undo some of the provisions related to tobacco from last year's tax bill. 

Also released this week was a tax increase study which showed that the Governor's tax plan would result in higher taxes for many Minnesotans, as result of extending the Provider Tax.  

GOP legislators are unlikely to support either of these issues in their bills, which will be rolled out soon.

Transportation has bipartisan support for more funding but they differ widely on where that funding should come from. As both transportation finance packages moved through the process many DFLers were concerned for the lack of transit funding in the bills. Both the House and Senate are relying on bonding to fix many of the roads and bridge projects.  

The big fight in the transportation funding debate will come next week when they will likely discuss a proposed constitutional amendment to dedicate the sales tax from some auto-related sales to a fund for roads and bridges. Supporters say the funding is needed and long overdue. Many are opposed though, saying it removes money that had been going to the general fund and prohibits it from being used for other critical needs, such as schools or health care. 

State Government Bill 
The House took a unique strategy in their supplemental appropriations bill, which was already expected to be opposed by Governor Dayton when they announced a cut- target of $7 million for state. In addition to that, the House also wants to use $26 million that was supposed to be used to pay off bonds from the Vikings stadium and redirect those founds to support three veterans homes in greater Minnesota. While the Governor supports the new veterans homes, his administration does not think this is the best manner to fund them.

Opioid Update
At the beginning of session there were bipartisan calls for legislation to address the growing issue of opioid addiction. One of the key pieces of the legislation introduced by the Governor and legislators was a small tax on opioid prescriptions, to fund the  programs needed for fixing this epidemic. That tax is finding opposition and potentially puts some of these new efforts to fight this problem in jeopardy.

1 New Justice 1 Less House Member
Rep. Paul Thissen was appointed to the State Supreme Court this week, by Governor Dayton. This court seat opened up when Judge David Stras was recently appointed to a Federal Judgeship. This was Dayton's 6th supreme court appointment; he has now appointed 5 of the 7  current  justices . It also puts an end to the legislative career of Rep. Thissen, who served as Speaker of the House (13-14) and ran twice for governor. 

Other Noteworthy Bills
Here are a few of this week's interesting, but perhaps less publicized actions:

Lawmakers consider capping minimum wage for tipped employees

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, 2018 at midnight 
Last day of session - May 21, 2018

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?

Now that we are past all three deadlines, the work will really begin to focus on taxes and the budget. Funding proposals  from each budget  area will now progress to Finance Committee  in the Senate and Ways and Means in the House. 

It is likely that these bills could be combined in some manner.  The Senate has indicated there will be one supplemental bill while the House has suggested there will be four. I am not sure sure what that means as far as how this will play out. 

As the budget bill(s) moves along it is expected that both the House and Senate will soon release their tax plans in response to Dayton's recently released plan. 

Not surprisingly , there are already major differences brewing between the Governor and the legislature. There are likely to be some differences between the House and Senate as well. While there is still plenty of time to find resolution it will require all sides limit their list of needs, and that process has not yet begun.

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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