Dear Neighbor,
House committees have wrapped up much of their regularly scheduled work and longer floor sessions are now going to be the norm as the Legislature enters the final month of the 2021 session with much work left to do.
The biggest single job to finish this session is to set a new two-year state budget and this week the House majority began bringing its omnibus finance bills to the floor for votes of the full body. On Thursday, one package related to housing and another allocating Legacy Amendment funds, were approved.
The Legacy bill appropriates revenue raised by a three-eighths of one percent additional sales tax that was passed by Minnesota voters in the 2008 Clean Water, Land and Legacy Amendment to the Minnesota Constitution. The additional “Legacy Amendment” sales tax revenue is distributed into four funds as follows: 33 percent to the Clean Water Fund; 33 percent to the Outdoor Heritage Fund; 19.75 percent to the Arts and Cultural Heritage Fund; and 14.25 percent to the Parks and Trails Fund. The Legacy Amendment runs through the year 2034.
In my view, funding for our Soil and Water Conservation Districts is among the most important provisions in the Legacy bill. This bill does fund SWCDs, but I am a bit concerned about its adequacy because it reduces funding in Year 2 of the budget and, also, there are winners and losers in this proposal.
This bill likely will be the subject of a conference committee in order to find agreement with the Senate before final approval can be considered. I hope the conference committee will fix problems in the House’s version of this bill so it can come back to the House in better shape. SWCDs do a very important job in getting projects going in Greater Minnesota and deserve stable funding and I’ll continue working for that.
Later today, we anticipate more omnibus bills coming up in the House. A bill related to state government finances and another pertaining to transportation are on the agenda. I mentioned in my last email that the transportation bill is rather controversial, especially since it includes a $1.5 billion tax/fee increase over four years. Among provisions in the transportation bill is a gas tax increase, estimated to cost drivers $363 million over four years.
While there are plenty of concerns with the transportation bill that ultimately will need to be resolved by a conference committee, the tax bill still looks to me like it could be the biggest hurdle to clear this session.
On one hand, the House majority is calling for tax increases at a time the state has a historic surplus. Meanwhile, the House minority is calling for tax relief, especially regarding the Paycheck Protection Program loans.
Minnesota remains the only state in the Upper Midwest that has failed to correct this issue and, unless we do, businesses that received forgiven loans from the federal government to make payroll and stay afloat amid the pandemic will be forced to pay state taxes on these dollars. That would be highly disappointing to see, and the state should not stand to profit off emergency funding sent to struggling businesses.
I remain optimistic we will fix the PPP problem and clean up the other issues in omnibus bills during the final weeks of the session so we can put a state budget in place that does well for Minnesotans. Stay tuned as things develop and, as always, let me know if there is anything I can do to help.
Sincerely,
Paul