State Representative
Steve Smith

ST. PAUL In a marathon session, ending late Wednesday morning, the Legislature overwhelmingly approved $350 million in permanent tax reductions and additional funding for schools. Rep. Steve Smith, R-Mound, said the bills were a victory for the people of Minnesota.

"I consistently hear two messages from the people: cut taxes and fund schools," Rep. Smith said. "We have done both of these over the last two years, cutting taxes by more than $3 billion and allocating more than $1.2 billion in additional money for our schools. I think the people have a lot to be happy about."

Under the legislation, income tax rates will be reduced across-the-board, benefitting every Minnesotan. The lowest and highest tax brackets will be reduced .15 percent and the middle bracket will be reduced by .20 percent. These cuts are in addition to the $1.6 billion reduction in income taxes last year. Because of these record income tax cuts, the average Minnesotan will benefit from a 15 percent reduction in their income tax liability.

"Minnesota now leads the nation in reducing the tax burden placed on their taxpayers-- it's about time!" Smith continued. "This is a great accomplishment and it makes the hard working taxpayers the real winners they will be able to keep more of their hard earned money every payday to spend it on the things their families need."

The bill also provides for another sales tax rebate of the current state budget surplus. More than $658 million will be refunded to all Minnesotans that had income tax liability in 1998, filed a claim for the 1998 property tax rebate or had social security income in 1998. The average rebate for a married couple filling jointly is $379 and $188 for a single individual. The checks will be mailed out sometime in August.

"License tab fee reductions came unexpectedly," Smith said. "But they count as another permanent tax cut for the people of Minnesota. Who can argue with that?"

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The license tab fee reduction will cut tab fees by $150 million a year. The provision keeps the registration tax the same for the first year of the vehicle's life. The license fee is capped at $189 for the second year and will be no more than $99 for the third year and thereafter. Tab fee reductions will be implemented on July 1, 2000.

"Our children and schools were the other big winners of the 1999 and 2000 sessions," Smith continued. "Despite our record commitment to education last year our local schools are facing substantial cut backs. We did our best to aid those schools with some one-time funding and more equitable formulas in the future for growing schools districts like ours."

Rep. Smith and state legislators also added to the $1 billion increase in K-12 education they passed in 1999 with a $172 million package which included special education, teacher training and school technology needs. The new funding will also provide aid for districts with declining enrollment and makes funding whole for schools with enrollment growth. The Legislature has also committed to reforming the highly controversial Profile of Learning.

With the new education funding, local school districts are estimated to receive the following additional funds for the 2000-2001 school year:

Estimated $ Benefit From New Funding for

District 2000-2001 School Year

Westonka $569,267

Orono $513,281

Buffalo $814,816

Delano $299,904

Rockford $382,002

"This year's tax and education bills are a great accomplishment; they will truly benefit everyone in the state," Smith concluded. "It is a great ending to two years of successful tax cutting, a commitment to education and more accountable and responsive government. I look forward to continuing these efforts next year."

Each of these bills now move to Governor Ventura's desk for his consideration.

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