Gov. Dayton comes down in proposed state budget spending

by T.W. Budig
ECM Capitol reporter

Republicans crammed into a Capitol press conference room this afternoon (Monday, May 16) in a mass show of support for holding firm on not raising taxes.

“When it comes to holding the line on taxes and spending, we cannot compromise,” said Senate Majority Leader Amy Koch, R-Buffalo.

The demonstration of unity came within hours of Democratic Gov. Mark Dayton budget offer’s to split the remaining $3.6 billion of state budget deficit between spending cuts and additional revenue.

Republicans are unwilling to spend more than $34 billion over the upcoming two-year budget cycle, while the Dayton Administration has been proposing to spend about $37 billion.

But Dayton’s offer of today means the governor is willing to decrease spending to $35.8 billion, according to a Dayton Administration official.

If there’s a special session or state government shutdown because of a budget impasse, he’s not to blame, Dayton explained.

“I think it’s their (Republican leaders) responsibility and their fault, because I offered to go half-way,” said Dayton of failing to successfully conclude the legislative session.

The regular legislative session ends a week from today.

In terms of his latest offer, Dayton proposed a new 4th-tier income tax bracket with a marginal tax rate of 10.95 percent to tax wealthier Minnesotans.

It would apply, for instance, to typical married couple with more than $250,000 in taxable income.

Originally, Dayton had proposed more than $3 billion in tax increases, including a temporary surtax on incomes over $500,000.

But the governor dropped the surtax, as well as a proposed property tax increase on homes valued at over $1 million.

Senate Minority Leader Tom Bakk, DFL-Cook, former Senate Tax Committee chairman, said the governor’s 4th-tier tax proposal would affect about 45,400 Minnesota tax filers. “It doesn’t seem like a big price to pay,” said Bakk of balancing the state budget with fewer cuts.

Bakk and House Minority Leader Paul Thissen, DFL-Minneapolis, both indicated their respective caucuses would support the governor’s latest proposal.

Support in the Senate DFL caucus would be “near unanimous,” said Bakk.

Dayton is willing to consider other forms of new revenue other than what he has proposed, he explained, and indicated everything is on the table in terms of spending cuts.

The governor and Republicans, said Koch, are fairly close on a number of budget bills — K-12 education, for instance. “We’re going to keep our phones on, keep our doors open,” Koch said of continuing budget talks with Dayton.

Only one budget bill, the agriculture bill, has been signed into law by Dayton.

Republican “working” conference committee budget targets show wide gaps between Republicans and Dayton on a number of bills in terms of spending:

Higher Education; governor, $2.7 billion; Republicans, $2.5 billion.

Tax Aids and Credits: governor, $3.5 billion; Republicans, $2.5 billion.

Health and Human Services: governor, $11.4 billion: Republicans, $10. 7 billion.

Environment and Energy: governor, $277 million; Republicans, $201 million.

Transportation: governor, $180 million; Republicans, $62 million.

Judiciary and Public Safety: governor, $1.8 billion; Republicans, $1.8 billion.

Jobs and Economic Development: governor, $165 million; Republicans, $138 million.

State Government: governor, $872 million: Republicans, $602 million.

K-12 Education: governor $14.2 billion: Republicans, $14.1 billion.

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