Dear Friends and Neighbors,
I have lots of important information to share as the week wraps up. In this update I’ll talk about the following:
* Budget shifts
* Gas Tax / Transportation bill
* Star Tribune report on the tax bill
* Scrapping MNLARS
* Eisenhower Bridge of Valor
Budget Update
The House continued its work this week by passing the remaining omnibus finance bills. I still have numerous concerns with the spending, taxing, and bad policy provisions in these bills. The next step is conference committees, where members of the House and Senate come together to work out differences in their respective budget bills. During this process, I’m hopeful these bills are improved before they eventually go to the governor.
I’m particularly concerned about how the Democrats’ budget shifts money around and relies on tax increases to make up the gaps. For example, the education budget increases spending by around $900 million. In order to help pay for this, the bill raids transportation funds and takes over $400 million that was previously “dedicated” to roads and bridges. And then because money is taken from transportation, the budget must include a gas tax increase to make up for those lost dollars. The $400 million equates to 7 cents of the gas tax hike. Likewise, in order to fund the new spending and expanded programs in the health and human services budget, Democrats rely on collecting $2.5 billion in taxes through the sick tax continuation. When this tax originated twenty years ago, the monies collected were supposed to be dedicated to pay for healthcare for the poor. The fund is now used for other purposes. These are just two examples of the many budget shifts that exist in the DFL and governor’s proposals.
Ultimately, if any piece of the moving parts in their budgets change, the whole budget falls apart and won’t work. The only way to realistically pay for this budget is with the collective $12 billion tax increase; it’s not possible without it. So on top of the taxes and spending, I’m concerned with this budget’s reliance on each transfer of funds or tax increase being in place in order to make it work. I fear that this instability will make coming to a compromised agreement especially challenging in the weeks ahead.
Gas Tax/Transportation
On Monday, the House approved the transportation budget bill, which increases the gas tax by 20 cents per gallon – a 70% increase. The 20-cent per gallon increase would give Minnesota the fourth highest gas tax in the country and the package collectively raises taxes by more than $4 billion over the next four years.
The bill also takes auto parts sales tax revenue dedicated to transportation and transfers it into our state’s general fund. This move would reverse the investments we made last year to fund roads and bridges without a gas tax hike.
Like you’ve heard from me before, a 20-cent per gallon gas tax increase would make living and working in Minnesota more expensive. We demonstrated last session that transportation infrastructure needs can be met without further burdening taxpayers. With a billion dollar surplus and a dedicated revenue source, I don’t believe lawmakers should be asking Minnesotans to pay more at the pump.
Star Tribune Tax Report
On a related note, last week, the Star Tribune reported that Governor Walz’s Department of Revenue released a report confirming that his tax plan would hit low and middle-income Minnesotans the hardest. The report indicated that, under the governor’s plan, Minnesotans making under $45,000 would see double-digit percent increases in their tax burdens. The Star Tribune's headline made it clear: "Lowest-income Minnesotans hit hardest by Gov. Tim Walz's tax plan".
MNLARS
Governor Walz announced this week that Minnesota would abandon MNLARS – the state’s failed licensing and registration system – in favor of a private vendor. MNLARS has been plagued by troubles since its inception, has wasted tens of millions of taxpayer dollars, and has caused long waits and headaches for too many Minnesotans. I commend Governor Walz for finally choosing to move away from this inefficient system, and I believe this is the right move for our state to most effectively provide licensing services to Minnesotans. It’s just a shame that the previous administration and the department wouldn’t own up to this mismanagement years ago.
Bridge of Valor
I proudly spoke on the House floor in support of the naming of the Eisenhower Bridge of Valor to remember and honor the sacrifices of all our veterans and first responders, past, present, and future. This provision is a part of the transportation packages in the House and Senate and I’m hopeful it’ll be a part of the final agreement. Click here for a video of my speech.
Also, thank you to Jane Drazkowski for her tireless advocacy for our veterans. I’m pictured below with Jane and Senator Goggins at the Capitol on Monday.
Visitors
Discussed some of the proposals in the public safety omnibus bill with Goodhue County Sheriff Marty Kelly.
Great seeing John Parkes with Goodhue Habitat for Humanity at the Capitol this week!
Staying in Touch
If you ever have questions or concerns regarding any issue, please contact me. You can reach me at rep.barb.haley@house.mn or 651-296-8635.
Have a great week,
