February 20 - 2018

Earlier today, both the House and Senate convened for the second year cycle of the 90th Minnesota State Legislature. For political geeks like myself, first day of session is much like the first day of school; there is a chance to see people you haven't seen for a while and catch up ... but it also comes with A LOT of homework. 

It is always hard to predict exactly what will happen over the next few months but at a minimum we know many of the topics that will be hotly debated, even if there is no promise of resolution in sight.  So to kick things off, here are some of the topics that are sure to get attention this session ...

- Taxes: to conform or not to conform
- Bonding: how big is enough?
- MNLars
Opiod Epidemic
Sexual Harassment Policy
Special Elections

This would be an interesting Jeopardy board, right? (lol)
Let's get started .... 
Taxes: to conform or not to conform
The tax overhaul bill the federal government passed in late 2017 significantly changed the way people and businesses are taxed by the federal government. As a result, it will become certainly more complicated for Minnesotans to file their taxes in 2019 - and potentially more expensive. The Tax committees will be wrestling this session with how or if they should align state taxes more closely with the new federal taxes;  but in doing so there are a number of consequences.  

The new tax system likely means that the state will see a forecast surplus ranging anywhere from $600 million to $1 Billion (the February forecast is due to come out soon). In order to conform with the feds it is likely that legislators will have to spend large chunks of that surplus. Additionally if they were to "fully conform" it would likely mean tax increases for a large number of Minnesotans. Add on the fact that Governor Dayton has additional priorities that he would prefer to spend money on, and you can see that this debate will be going on throughout the session.

Bonding: how big is enough?
Typically the 2nd year of a legislative cycle is called the bonding year. This is when the state approves a wide range of infrastructure projects that are paid for with bonds, sold on the markets. Bonding bills are also often referred to as "the state credit card". This funding can only be used for infrastructure projects such as buildings, roads and bridges,not for ongoing programming.  

Passage of bonding bills requires two-thirds support in both bodies so there is a need for bipartisan support to get them through. Governor Dayton has submitted his proposal of projects - totaling nearly $1.5 billion. Many GOP legislators are wary of spending too much on bonding this year, so the balancing act becomes: how big can you make it in order to gain enough DFL votes, while also keeping enough GOP votes? The House and Senate will each release proposed bills later this session.

If you thought the roll-out for MnSure was messy, the new Mn License and Registration System (aka MNLars) says "Hold my beer". Apparently, 10 years of work and $93 Million does not get you very far these days. State officials recently announced that they would need an additional $43 Million to finish the project that aims to update the computer system that racks and updates our drivers licenses and license plates. This is simply just a major screw up and it will certainly be a significant point of contention between the legislators and the Governor during session.

Opioid Epidemic
In an effort to curb the alarming rate of opioid addiction and overdoses in Minnesota, Governor Dayton and some GOP legislators are looking to impose a penny-per- milligram fee on pharmaceutical companies to fund efforts to mitigate the crisis in MN. The new fee will raise about $20 million annually but is opposed by industry organizations.

Sexual Harassment Policy
With two legislators stepping down at the end of last year, as a result of allegations of inappropriate behavior, there has been a renewed effort to update the process and understanding of harassment in the workplace at the capitol. All legislative leaders have indicated a willingness to implement new policies around this topic but what that means exactly, is yet to be determined. One of the most challenging parts is that there are so many people that work at the capitol ... but they all have different bosses ... and having a policy that covers everyone is nearly impossible. 
Special Elections
The Special elections held Feb. 12th resulted in no net change at the Capitol. DFL'er Karla Bingham held on for a win to replace Senator Dan Schoen in the Inver Grove Heights / Hastings area. Meanwhile, GOP candidate, Jeremy Munson, was successful in replacing former Rep, Tony Cornish. n the end, both parties held on to the seat they held before. 

Many pundits may try to decipher meanings from the election - as predictors to the November midterm elections - but those are still a long way off and many other factors that will come into play before next Fall.

What's Next?

The  first week of session will typically be filled with overview hearings and broad topics. S ome bills may be heard, such as approval for legislative funding that Dayton vetoed last session and has said he will now sig n, but mostly this first week will serve as a warm-up.  

Next week I expect a number of committees to ramp up their work and begin hearing bills in earnest. With a shortened legislative calendar it will be important for both bodies to take full advantage  of hearing schedules to process any bills they expect to get signed.

We could also see a re- emergence  of the legal challenge to Senate President Fishbach's dual role of Senator and Lt. Governor. An earlier challenge was dismissed by the courts; in part because she had not taken any action yet. Now however, with session underway, that argument could be contested.

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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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