As you probably know by now, Governor Dayton released his budget proposal to the legislature for the 2014-2015 fiscal year. I’m already deeply concerned about how this budget would enlarge the size of our state government, hurt middle class Minnesota families, and harm our business climate.
Governor Dayton’s budget proposal calls for $37.9 billion in state spending for the next biennium. To give you some perspective, the budget for the 2012-2013 fiscal year was $35.2 billion. This amounts to a 7.6% increase in spending and an 11.9% increase in taxes. That 11.9% tax increase translates to $3.7 billion in tax increases – the largest tax increase ever proposed by a Minnesota governor. The governor has long called for a “balanced approach” to solving our budget problems. I hardly think that offering $225 million in cuts with $3.7 billion in tax increases is a “balanced approach” for our state. Minnesota families simply cannot afford to pay more in taxes to grow the size of our government.
Perhaps the most concerning aspect of this plan is the $2.1 billion of new sales taxes proposed on goods and services that will be paid for by the middle class. The budget proposal seeks to tax clothing over $100, health club memberships, over-the-counter drugs, haircuts, legal services, accounting services, online purchases, digital downloads, and auto repairs. We know that in these Minnesota winters, our families need warm winter coats. Imposing a tax on them hits middle class families where it hurts. I’m also perplexed by the governor’s proposal to increase the cigarette tax by 94 cents. When he was running for governor in 2010, then-candidate Dayton referred to this idea as a regressive tax that would hurt middle incoming working families. I’m not sure why the governor has flip-flopped on raising taxes on the middle class, but you can be confident that I will be consistent in opposing such taxes.
I’m also troubled by how Governor Dayton’s budget proposal would affect the business climate in Minnesota. The governor is pushing for a two percent increase on the top two percent of income earners. My concern with this kind of tax increase is that taxes on income hurt small businesses registered as S-Corps and LLCs who file their taxes through individual tax returns. Ninety-two percent of businesses, job creators in Minnesota, file through individual tax returns. To make matters worse, the governor wants to tax business-to-business transactions like legal, accounting, advertising services. Making the cost of doing business in Minnesota higher will only force job creators to flee our state and relocate in neighboring states with more competitive business climates. While the Governor touted his budget as a “Budget for a Better Minnesota” last week, I believe a more fitting title would be a “Budget for a Better Wisconsin.”
While I’m concerned about the direction this budget is heading, it is still early in the legislative process and much could change. I will continue to update you on my thoughts about the budget and how it will affect you as session moves forward.
WRIGHT COUNTY COURT VISIT
Last Friday I had the privilege of shadowing Judge Geoff Tenney at the Wright County Government Center. I spent the entire day observing court proceedings ranging from criminal to family to juvenile cases. It was an eye-opening experience that one can only have by observing the process. As someone who has volunteered in the Wright County jail for the past ten years, it was amazing to see how much the Wright County court system has modernized its recording and tracking systems. While much has improved on the administrative side of the court system, I was saddened to see that the vast majority of cases before the court related to chemical dependency issues. As a member of the Judiciary Policy & Finance Committee, I would like to see greater emphasis on chemical dependency treatment in jail. Wright County is one of the few counties that does this and I hope it can be example to other correctional systems across the state.
I enjoyed visiting with constituents last week from the ABATE group in my St. Paul office. Members of ABATE (which stands for American Bikers for Awareness, Training, and Education) met with legislators to discuss motorcycle and biker safety issues. Thank you to Rod Quist of Maple Lake, Tom Wose of Monticello, Mike Jencks of Buffalo, Becky Hasslen of Buffalo, Dave Clifton of Buffalo, and Maureen O’Hern of Buffalo for stopping by my office. I also had the pleasure of meeting with Scott Peterson, a constituent who is a student taking classes with the University of Minnesota’s Extension Services program.
As the legislative session moves forward, I am interested in your feedback. Please feel free to contact me by e-mail at Rep.Marion.ONeill@House.MN or contact my office at 651-296-5063. You can also send me mail to my office address: 229 State Office Building, 100 Rev. Dr. Martin Luther King Jr. Blvd., St. Paul, MN 55155. Please feel free to share this e-mail with your family, friends, and neighbors so they can sign up and stay in touch.