Saturday, March 08, 2014

Missed a Day (or Two).  The weekend is here and I can catch up with a couple days where I haven't been able to blog.  We started our circuit of SEE regional meeting with our first meeting in Isanti (at the Creamery Crossing, which I highly recommend for food and value) and meetings will run through the month.  Monday we are meeting at the Red Goat in Cokato.  I hope to see as many SEE members there as possible.  These are valuable listening sessions where membership gets to voice concerns and opinions on legislation in an informal setting.

Now, back to business.

House Passes Tax Cut Bill.  The Minnesota House of Representatives passed a $503 million tax cut bill by an overwhelming vote of 126-2 on Thursday.  The bill undoes several of the tax increases enacted by the Legislature and signed by the Governor last session.  Foremost among the cuts are the repeal of the business-to-business taxes, some of which are slated to go into effect on April 1 if the Senate does not act on the bill and get it to the Governor to sign before then.  Expect a concerted effort by the business community to push the Senate toward action in the next couple of weeks.  The House vote roughly coincides with Governor Dayton's release of his supplemental budget for the remainder of the biennium.  I'll talk a bit more about the Governor's budget later (and how disappointing it is for education), but his plan calls for an additional $113 million in budget cuts beyond what the House improved, mostly through almost full conformity with changes made in the federal tax code last year, particularly in the area of the estate and gift taxes.

Here is a story from the Pioneer Press that discusses the House vote and the Governor's budget:

Governor's Budget.  As I mentioned above, the Governor released his budget on Thursday.  It's heavy on tax cuts, light on spending, and somewhere in between on putting money into the budget reserves.  I described the proposed tax cuts above and how they go beyond the bill the House passed on Thursday.  The budget proposes $162 million in new spending, $3.5 million of which would go to education to pay for making reduced-price lunches free and preventing lunch "refusals" in Minnesota school districts.  The remainder of the projected surplus--$455 million--would be placed in the budget reserve.

It is difficult to say how the Legislature will respond to the Governor's budget.  It's pretty obvious that there are going to be considerable tax cuts in the final package.  It's also obvious from the Governor's perspective that he is leaving space for the Legislature to increase spending by either not cutting taxes as greatly or dipping into the budget reserve.  What there isn't is much room to move dollars from one expenditure to another in the Governor's proposed spending increases.  The largest single new spending increase in the Governor's budget proposal is an additional $64.3 million to pay for a proposed 4% increase for nursing home providers.  There are a number of other increases in the $10 million to $20 million range, but given the fact that $20 million has been budgeted, passed by the Legislature and approved by the Governor for low-income heating assistance, there is even less room to maneuver.  Further, the Governor's recommendations all are going to budget areas that would be difficult to move dollars out of.

What is most disappointing from the education community's perspective is the lack of new resources in the budget.  It's not that much different from last year, where legislative efforts--especially in the House of Representatives--put more revenue into the base budget for education.  Add to that the work done in the Senate Tax Committee to increase equalization and it added up to a good year for education in 2013 that started with somewhat meager hopes.  It will be interesting to see how the Legislature proceeds.  I think it is extremely important for educators from all regions and stripes to contact their legislators and remind them that although 2013 was good (and that legislators should be thanked for their efforts), there is still a lot to be done and that cannot be done without resources.  There are a number of bills floating around to correct problems in the education funding system--particularly the doughnut hole from SEE's perspective--and put more money into an education funding base that hasn't truly kept pace with inflation over the past two decades.

It will make for an interesting couple of months ahead.

Link to Governor's press release on tax and budget recommendations:

Tax Cuts:

Budget Recommendations:

Thursday Bill Introductions.

SF 2314 (Torres Ray)/HF 2378 (Davnie): Increases revenue for early childhood screening, early education, English language learners, and adult basic education:

SF 2328 (Torres Ray)/HF 2679 (Mariani):  Increases revenue for extended time, English language learners, and the safe schools levy:

SF 2370 (Jensen)/HF 2547 (Radinovich):  Doughnut Hole Solution:

SF 2382 (Pratt)/Currently No House Companion:  Modifies unrequested leave of absence provisions for teachers:

SF 2411 (Nelson)/Currently No House Companion:  Anti-Bullying Bill modeled on North Dakota Anti-Bullying Legislation:

HF 2743 (Hortman)/SF 2520 (Hoffman):  Increased equalization for facilities-related levies including debt service:

HF 2744 (Dorholt)/SF 1939 (J. Pederson):  Increases English language learner eligibility from 5 to 7 years:

HF 2776 (Brynaert)/SF 2479 (Dahle):  Recommendations of Career Pathways and Technical Education Task Force:

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