Inside the Minnesota Capitol

Inside the Minnesota Capitol

Minnesota politics, regulatory agencies and state government news updates

Week in Review

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MNsure Reform
Minnesota’s already low rate of people without health insurance fell even more over the past year, a survey from Gallup finds. At the beginning of 2014, just 9.5 percent of Minnesotans lacked health insurance, the fourth-best rate in the country. As of the start of 2015, that uninsured rate is now 7.4 percent, 2.1 percentage points lower.

Senate HHS Budget Chair, Tony Lourey’s (D-Kerrick) bill, SF139, went through a second committee this week. The bill seeks to eliminate the Board of Directors, and designates MNsure as a separate state agency. It also provides parity for MNCare and Medicaid with respect to compensation paid by MNsure to navigators and brokers to align with private insurers. Addressing the technology concerns, it requires MNsure to establish and maintain an agreement with MN.IT for IT services.

Sen. Lourey noted that the bill encompasses the three key recommendations included in the Office of Legislative Auditor report: governance structure, bring IT under MN.IT, and parity of pay to brokers for public and Qualified Health Plan (QHP) programs.

This year’s MNsure enrollment period was a technological success, but MNsure’s software still has major problems. The software meant to handle low-income people who qualify for public health programs is missing key features, wreaking havoc for counties as they try to manage their public assistance caseloads.

However, Board member Tom Forsythe reacted negatively to the idea saying, making MNsure a state agency would make the exchange less accountable than a board that makes decisions in meetings open to the public. He thought MNsure could concentrate solely on helping Minnesotans easily shop for and enroll in private health insurance plans (QHPs). Forsythe went as far as to suggest separating MNsure and DHS, allowing MNsure to have a much narrower vision. Sen. Sen. Lourey responded that this would contradict the one-stop-shopping premise of the Affordable Care Act. DHS Commissioner Jesson agreed with Sen. Sen. Lourey, saying that more than 90 percent of the people going through MNsure enroll in public programs.

Next stop Senate Commerce Committee.

Ebola Deficiency Funding/Pay Raises
Deficiency funding, usually a non-controversial measure, was held hostage for several weeks by the debate over the Governor’s recent pay raises for his Commissioners. Gov. Dayton maintained that they were a long time coming and the Republicans pushed back saying they were too large of a jump and thought the Governor should have notified them.

The agreed language includes the following one time appropriation from the General Fund.

  • $10.68 million to the Department of Human Services for the Minnesota Food Assistance Program ($246,000) and the Minnesota Security Hospital in St. Peter ($10.44 million);
  • $2.89 million to the Department of Health for costs of statewide Ebola activities and for grants to certain hospitals for Ebola-related expenditures; (Unity $221,000; Children’s $710,000; Mayo $413,000; and UMN $508,000; and $148,000 to EMS Board);
  • $1.35 million for Minnesota Zoo operations; and
  • $568,000 to the Department of Natural Resources for enforcement.

With respect to the salary issue, the language reduces the budgets of DHS, MDH and DNR for FY 2015 by the following: $16,000 for MDH, $6,000 for DHS, and $18,000 for DNR. It freezes salaries at 2014 levels through June 30, 2015 and then allows the Governor to authorize an increase on July 1 before oversight by the Legislative Coordinating Committees kicks in on July 2. There was some question about whether the raises would be automatic or require action by the Governor, so MMB requested clarification that Dayton would have the authority on July 1 to reinstate the increases.

The House and Senate appointed conferees on Monday. The conference committee met on Wednesday and adopted mostly House language with respect to the salary controversy. Votes and final passage on the conference committee report came Thursday in both chambers. The Senate held a lengthier debate over the salary issue with a vote of 35-29 and the House was quick to dispense with the report by a vote of 108-20. Gov. Dayton is expected to sign the bill.


Legislation placing new restrictions on the state lottery is heading for another vote in the Minnesota Senate. The Senate Tax Committee passed the bill Monday. It now heads to the Senate floor. The measure bans the lottery from selling games at gas pumps and ATMs, as well as the online sale of instant win tickets.

During the committee hearing, Sen. Julianne Ortman, R-Chanhassen, told Minnesota Lottery Director Ed Van Petten that she thought the ATM sales were particularly “outrageous.” “I definitely draw the distinction between offering lottery tickets for sale, versus shoving them in your face and targeting certain individuals to buy them,” Ortman said. “It’s a very clear distinction, and when you made that leap I think you absolutely needed to come back and ask for authority through the legislative process and through statute.” Van Petten warned that a ban would put the lottery in violation of its contracts with vendors.

The House is also poised to vote on the lottery ban legislation. Lawmakers overwhelmingly passed the same bill at the end of the 2014 session, but DFL Gov. Mark Dayton vetoed it. He said earlier this month that he would veto the measure again but there is some indication the issue may have come up in negotiations over the deficiency bill.


In making his case for higher state transportation taxes, Gov. Dayton points to a slowing flow of money from Washington for highway construction as a reason that he needs to call on Minnesota taxpayers.

As costs increase for building and repairing roads, Minnesota officials and transportation planners face a choice: scale back their annual construction programs or turn inward for money to narrow the gap.
Dayton is pressing for a new 6.5 percent wholesale tax on gas, which would be on top of the current 28-cent-per-gallon charge. That, along with higher vehicle registration fees and the sale of more bonds, would generate about $6 billion in the next decade to repair or replace 2,200 miles of roadway and 330 bridges.

Rep. Tim Kelly (R-Red Wing), House Transportation Chair, is not convinced raising taxes is the right course. House Republicans plan to seek a quick shot of new transportation funding this session, with a sizable amount drawn from a projected state budget surplus. Rep. Kelly has inferred that GOP members will wait until the 2016 session to figure out a long-term finance plan.

Minnesota’s transportation system is the fifth largest in the nation, the network of entities that care for the system is complex, and the funding streams are unpredictable.

SurveyUSA interviewed 600 Minnesota adults between Feb. 20 through Feb. 24. They answered questions about Gov. Dayton’s performance, transportation, commissioner pay raises and sports.  On the transportation question:

Governor Dayton proposes a sales tax on gasoline, higher driver’s license registration fees. and a higher general sales tax in the 7-county Minneapolis metro area to raise $6 billion over 10 years for new highways, bridges and mass transit. Do you approve or disapprove?

43% Approve
51% Disapprove
6% Not Sure

House Republicans propose spending $750-million on highways and bridges over four years by using some of the state’s budget surplus and other existing funds without raising taxes. Do you approve or disapprove?

75% Approve
17% Disapprove
8% Not Sure

February Forecast Projects Larger Surplus

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Minnesota Management and Budget (MMB) announced a short time ago that the surplus for FY 2017-2017 has ballooned to $1.869 billion. This $832 million increase is mostly the result of additional revenue collections. Here is the statement released earlier this morning:

“February Forecast Projects FY 2016-17 Balance To Be $1.869 Billion

Increase in Balance due to Higher Revenues, Lower Spending
FY 2016-17 revenues are now forecast to be $42.497 billion, a $616 million (1.5 percent) increase over November estimates. Current law spending is forecast to be $41.128 billion, $115 million (0.3 percent) below previous projections. Changes to revenue and spending in the current biennium add $107 million to the FY 2016-17 beginning balance. As a result, the projected forecast balance in the next biennium is now $1.869 billion, an increase of $832 million over the November forecast.”

Week in Review

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Pay Raises/Ebola Funding

Reacting to the firestorm over the Governor’s recent salary increases for his Commissioners, the House had inserted language to cut the funding for one year for the Departments of Health, HHS and DNR. In response, the Senate took up the bill late last week and in an effort to preempt the Republicans offering an amendment regarding the recent pay raises, Senate Majority Leader Tom Bakk (DFL-Cook) offered his own amendment to the deficiency bill last week, which includes Ebola deficiency funding, to suspend the Governor’s salary increases until July 1 to give the legislature time to assess the increases. Governor Dayton made his displeasure known saying he’d veto the emergency spending bill if it cuts the pay of his commissioners, delaying emergency money for the departments of Health, Human Services, and Natural Resources, and for the Minnesota Zoo.

The House passed the bill on Thursday and settled on an agreement worked out by the Governor and legislators to rescind the Commissioner pay raises until July 1, 2015, and return authority for future salary increases to the Legislative Coordinating Committee beginning July 2, 2015. The Governor would have one day, July 1, to decide to reinstate the salary increases without review.

The Senate and House bills must now be reconciled in conference committee. Sen. Bakk has indicated that the final version will be ready for floor action next Thursday.

MNsure Audit Report

According to the much anticipated Office of Legislative Auditor report on MNsure, in its first year of operations, MNsure’s failures outweighed its achievements. Several committees are holding oversight hearings on the report.

MNsure missed its enrollment target again this year. Just over 60,000 people signed up during open enrollment. That was below the target of 67,000 that the Board set in December, and far below the original target of 100,000 enrollees. Although many low-income residents have successfully signed on for public health programs, it’s failed to attract many middle-income customers to use the site to sign up for commercial coverage offered by private insurers.


Privacy advocates are pushing to allow Minnesota voters to decide whether their electronic communication should be protected from unreasonable search and seizure, encouraging the Legislature to put the question on the 2016 ballot. Rep. Peggy Scott (R-Andover) responded by introducing HF327. Rep. Scott worries that law enforcement is overstepping its authority in acquiring data like financial and telecommunications records without getting search warrants.

A House committee held a hearing on the bill this week. No committee hearing is scheduled in the Senate and DFL Senate Majority Leader Tom Bakk said he’s reluctant to put any measures on the ballot next year.

Privacy issues are a major theme at the Capitol this year. There are also discussions about the privacy implications of police body cameras, police use of automated license plate readers, and electronic health records.


In an attempt to increase public support for his $6 billion transportation proposal, Gov. Mark Dayton released a list of 600 state road and bridge projects Tuesday that he says won’t happen unless his plan is passed into law. Transportation Commissioner Charlie Zelle said about 72 percent of the projects on the list are in rural Minnesota and Twenty-eight percent are in the seven county metropolitan area.

The Governor is proposing to raise the wholesale tax on gasoline by at least 16 cents per gallon and to hike vehicle registration fees to pay for the road and bridge projects in his plan. He also wants to increase the sales tax in the metro area by a half cent to pay for transit projects.

House Transportation Chair Tim Kelly’s (R-Redwing) plan is to spend $187 million a year over the next four years by tapping the state’s budget surplus and by trimming other spending in the transportation department. He said he expects to announce a broader package in a few weeks.
Senate Democrats have backed a plan that resembles Dayton’s proposal but is more generous.

MNsure Audit Released

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The Office of the Legislative Auditor (OLA) released its much-anticipated review of MNsure’s first year of operations. MNsure is Minnesota’s online health insurance marketplace that was established in accordance with the Affordable Care Act, also known as Obamacare. Overall, the OLA concluded that “MNsure’s failures outweighed its achievements in its first year of operations. There were widespread problems with MNsure’s online enrollment system and customer service, causing difficulties for consumers, insurers, counties, and the Department of Human Services.” The report also made key recommendations for the Legislature:

  • The Legislature should amend State law to give the Governor, rather than the MNsure Board, authority to appoint the MNsure Chief Executive Officer. In addition, the Legislature should consider whether to retain the MNsure Board as a governing body or to make it purely advisory.
  • The Legislature should amend statutes to formally create a governance structure for MNsure’s enrollment system and ensure that MNsure’s future information technology work is subject to oversight from the Office of MN.IT Services.
  • MNsure and DHS should ensure that insurance brokers are fairly compensated for enrolling consumers through MNsure.
  • MNsure should improve its ability to access and analyze the applicant and enrollee data it collects.

Several committee hearings were held on the report immediately after it was released. There were predictable partisan attacks and defenses of the MNsure program. The Republicans focused on the overall cost of the program, IT glitches, and the lack of customer service. The Democrats highlighted the gains Minnesota has made in reducing the uninsured and that the program continues to improve. To a degree, there did seem to be some bipartisan appetite to pursue legislation to improve MNsure based on the OLA’s recommendations. One bill, SF 139, authored by Senator Tony Lourey, would eliminate the MNsure Board of Directors and make MNsure a cabinet-level State agency. It has passed one committee in the Senate.

While much of the report focuses on MNsure’s shortcomings in its first year, the report did contain a few bright spots for MNsure. The report concluded that 67 percent of individuals surveyed who purchased private coverage through MNsure would purchase the same coverage again and 43 percent of respondents indicated that MNsure lowered their insurance costs.

In any event, the report and the interest around it seem to indicate that this issue is not likely to fade into the background anytime soon.

Week in Review

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Pay Raises

Gov. Mark Dayton and the Republican House are sparring over state agency commissioner pay. Last month, Dayton increased pay for 26 commissioners and department heads by a total of $802,000. Republicans say the raises are outrageous. But Dayton said the salary hikes were necessary to attract and retain top talent to state government. He says it also puts state pay in line with other units of government. During a House Ways and Means Committee hearing on Monday to consider the deficiency bill, Rep. Drazkowski (R-Mazeppa) offered an amendment, which was adopted, for a one time reduction in the budgets of the agencies impacted by the deficiency bill to send a message over the raises.

Rep. Roz Peterson (R-Lakeville) has introduced a bill, HF666, which would give the Legislature the authority to approve the salary of certain executive branch officials.

Ebola Funding

On Monday, the House Ways and Means Committee passed, as amended, HF264, the deficiency bill which included money for the four hospitals that stepped in to assist with the Ebola crisis. The bill was amended to appropriate $2 million for Fiscal Year 2015 to the General Fund for the Commissioner of Health to provide grants to eligible hospitals and the EMS regulatory board. It breaks the funding down by each of the four hospitals and EMS board. (This language is also in Senate bill). The bill was placed on the General Register for floor consideration where it also lies in the Senate.


Gov. Mark Dayton made it clear this week he will again veto legislation that tries to limit Minnesota Lottery sales. He criticized the bills that would ban lottery sales at gas pumps, ATMs and online. Lawmakers passed a similar bill at the end of the 2014 session, and Dayton issued a pocket veto.

Dayton outlined a possible new proposal for lottery proceeds, dedicating some of the money to a special state fund for school construction and college campus improvements. Dayton said it would help remind Minnesotans of the importance of lottery funds.


In an effort to offset the projected cost of improvements, Gov. Mark Dayton wants railroads to pay significantly higher property taxes. Dayton’s plan would generate more than $20 million a year for the state and $45 million for local governments. It would expand the taxable property of railroads to include train cars, locomotives, bridges and other structures and update the method for determining the value of railroad property.

State officials identified $240 million in rail improvements that are needed statewide. Minnesota Revenue Commissioner Cynthia Bauerly said that much of the new tax money collected from railroads would go to cities, counties and townships along rail lines.

BNSF Railway spokeswoman Amy McBeth said there are questions about the legality of the proposal, saying it appears to be a violation of a federal law that precludes different treatment of railroads.

House Tax Committee Chair Greg Davids (R-Preston) called the proposed tax regressive, punitive and a non-starter. Senate Tax Committee Chair Rod Skoe (D-Clearbrook) said he wants to learn more. His panel will take a close look at the proposal later this month.

Week in Review

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In light of issues MNsure has encountered during its first year, Sen. Tony Lourey (D-Kerrick), Senate Health and Human Services Budget Committee Chair, wants more accountability. His bill eliminates the Board of Directors, and designates MNsure as a separate State agency. It also creates parity for MNCare and Medicaid enrollees with respect to compensation paid by MNsure to navigators and in-person assistors to align with insurance producers, and requires MNsure to establish and maintain an agreement with MN.IT for IT services. Lourey’s bill was passed by the Senate State and Local Government Committee on Wednesday, the first of several stops along the way.

Sen. Julie Rosen (R-Vernon Center) has a bill that would preserve MNsure’s current structure, but make some key changes, including allowing insurance executives to sit on the board. Those who helped create MNsure say having an industry executive on the board presents a conflict of interest. But others, including the business community, have long argued that someone who knows the ins and outs of the insurance enrollment process may have prevented some of MNsure’s technological glitches.

Rep. Joe Atkins (DFL-Inver Grove Heights) authored the MNsure bill in the Minnesota House two years ago, says he’s concerned about doing away with the board and is not ready to make big changes.

House Health and Human Services Reform Committee Chair Rep. Tara Mack (R-Apple Valley) introduced a bill last month to cap pay for MNsure’s top officials and require the State to seek waivers making federal subsidies for health insurance available to anyone, whether they buy insurance on or off the exchange.

Governor Dayton says he is open to the discussion.

Mental Health

Gov. Mark Dayton is calling for a $35 million boost in funding for mental health services throughout the State — a plan mental health advocacy groups are applauding.

In broad terms, it pumps new money into prevention and early intervention programs, improves access to treatment and expands community support for recovery. The Governor’s plan would establish a single statewide emergency phone number for crisis services. It creates a new psychiatric residential program for children, and expands the number of community treatment teams.

Funding would be increased for adult housing services, community mental health centers and family care. The plan also includes a study of State payment rates to mental health care providers.

Rep. Matt Dean (R-Dellwood), Chair of the House Health and Human Services Finance Committee, was reserving judgment on the mental health proposal until he learns more about it.


While the Governor and the new House Republican majority have both said a big transportation spending boost is one of their top legislative priorities this year, the two parties are far apart on how to pay for it.

Dayton has made it clear that a successful transportation deal must establish permanent new money streams for transportation projects. The Republican approach has been more modest, resting largely on using a slice of the projected budget surplus to escalate road and bridge spending over the next four years, utilizing efficiency savings at the Department of Transportation, and issuing bonds for more road and bridge building.

House Speaker Kurt Daudt (R-Crown) insists he is optimistic that this legislative session could produce a transportation bill to make both Democrats and Republicans happy, but does not think the public is ready for a gas tax. House Transportation Chair Tim Kelly (R-Red Wing) said he would like to see the Legislature pass a more modest plan this year, and wait until next year to tackle a more comprehensive funding solution. But his Senate counterpart, DFL Sen. Scott Dibble (DFL-Minneapolis) said a final reckoning with the size of the need should not be delayed. Senate Majority Leader Tom Bakk (DFL-Cook) agrees.


Minnesota’s Department of Employment and Economic Development has awarded nearly $20 million in State grant funding to 17 projects aimed at increasing broadband Internet access in underserved rural areas. The grant money, which was allocated last session by the State Legislature as part of the Border-to-Border Broadband initiative, will be matched with $25.8 million in private investment.


Lawmakers are considering a request for $2 million to help defray the millions of dollars spent by four Minnesota hospitals designated to treat Ebola cases. Mayo Clinic Hospital-Saint Mary’s Campus is one of those four designated centers, and has spent more than $1 million preparing to treat Ebola cases. Of that money, roughly $785,000 was related to the hospital being a designated Ebola treatment center.

In total, the four designated hospitals spent more than $4 million, according to information submitted to the Minnesota Department of Health. Supporters of the aid say these hospitals stepped up during a potential health crisis and should not have to bear all of the costs.

The three other hospitals designated as Ebola treatment centers are Unity Hospital in Fridley, Children’s Hospital and Clinics in St. Paul and the University of Minnesota Medical Center in Minneapolis. The House Health and Human Service Finance Committee amended a bill for $2 million in grant funding to help the hospitals recoup some of their costs. On Monday, Senate Finance Committee Chairman Dick Cohen (DFL-St. Paul) decided to divvy up the $2 million based on the percentage of the total Ebola preparation costs spent by each hospital. It is expected to be taken up on the Senate floor shortly. The House Ways and Means Committee was to take up the bill on Thursday, but rescheduled the meeting for Monday, citing the need for further negotiation.


A measles case reported at the University of Minnesota is eliciting discussion about Minnesota vaccination laws and prompting health officials to remind parents that it remains a contagious and dangerous disease. The debate has also sparked attention at the national level among presidential candidates, with some controversial remarks made about the effectiveness/health risks of vaccines. Current Minnesota law allows parents to opt out of vaccinations for medical or philosophical reasons, but Rep. Mike Freiberg (DFL-Golden Valley) introduced a bill to require parents to talk to a doctor first before opting out. As measles continues to be an issue across the country and in Minnesota, this may be something the legislature delves into.

Week in Review

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On Monday, Governor Dayton presented his 2015 Transportation proposal. His proposal would bridge the $6 billion State highway transportation funding gap over the next 10 years by raising new dedicated revenues for roads and bridges.

The new funding for roads and bridges would be generated from a 6.5% gross receipts tax on gasoline (the wholesale gas tax would be reset once a year based on the wholesale price of gas), raising the current 1.25% base tax on vehicle registration fees to 1.5%, and raising car registration fees by $10.

Additionally, the proposal:

  • Requires MNDOT to generate efficiencies of 15 percent from all new revenues, allowing MNDOT to do $6 billion of work for $5.38 billion in new funding.
  • Funds roads, bridges and transit across MN and creates 119,000 new jobs.
  • $6 billion over the next two years to State’s highway funding deficit.
  • $2.356 billion in local government transportation projects.
  • $2.92 billion for transit systems.

House Transportation Committee Chair Rep. Tim Kelly, R-Red Wing, said the Legislature needs more time to figure out exactly how much money the State really needs for its roads, bridges and transit.


On Tuesday, Gov. Mark Dayton rolled out his proposed $42 billion two year budget. It would seek to invest the State’s $1 billion surplus in initiatives to improve education and child health. Dayton’s budget includes $17 million for K-12 education with $373 million in new money, and an additional $93 million for higher education. It also includes an expansion of a child care tax credit that will cost the State $100 million. Another $44 million will go to child protection and mental health services. His proposal also includes $109 million to provide 31,000 four-year-olds with preschool.

Dayton’s budget also includes more than $70 million for new bonding to make railroads safer and annual railroad assessments to make rail crossings safer. He proposed changing how the State taxes railroads and assessing a new fee dedicated to safety improvements. The Governor’s budget proposal would make a $30 million investment in broadband infrastructure development and would invest in a continuum of care solution that promotes mental health and early intervention. Additionally, he allocates another $11.6 million to the Department of Human Services to help DHS cover its share of MNsure’s expenses. Most of the money would pay for MNsure IT fixes.

Absent from Dayton’s budget is new funding for nursing homes, because the industry got a funding increase during the last legislative session. Nursing homes are looking for what amounts to $200 million more in this session The Long-Term Care Imperative (nursing home coalition) said they will continue to push the issue. Their proposal has the backing of some key House Republicans.

House Speaker Kurt Daudt, R- Crown, said he hasn’t picked a date to release the Republican budget, but hinted that it would follow the next budget forecast released at the end of February.


Week in Review

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Committee deadlines for the 2015 session were established this week:

  • March 20, committees must act favorably on bills in the house of origin;
  • March 27, committees must act favorably on bills, or companion bills, that met the first deadline in the other house; and
  • April 24, committees must act favorably on major appropriation and finance bills.

The House, Senate and Governor also announced an agreement on allocation of space in the renovated Capitol. The design reduced the number of offices for State Senators inside the Capitol from 39 to 4, assigning offices in the newly constructed Senate office building across the street.


The first bill adopted on the House floor was the tax conformity bill, HF6, introduced by House Tax Committee Chair Greg Davids (R-Preston). It was introduced on January 8 and passed by the relevant House Committees a week later. The bill was amended to add language from HF27, clarifying the 2013 Destination Medical Center law to address a recent Attorney General’s ruling. Following a unanimous bipartisan 129-0 House floor vote, it moved to the Senate, with sponsorship by Sen. Rod Skoe (DFL-Clearbrook). House Minority Leader Paul Thissen (DFL-Minneapolis) urged the Senate to move quickly to pass the bill and it did so on Thursday with a vote of 62-0.

Minnesota Senate Republicans unveiled a plan to eliminate the state income tax on Social Security in an effort to keep retirees from leaving the State. The “Retire in Minnesota Act” would reduce Minnesota’s income tax on Social Security income by 10 percent annually until it is completely phased out in a decade. Although leaders acknowledge it will reduce seniors’ contributions to the State’s fund, they argue that loss will be made up by the seniors who stay in the State and contribute to the economy.

Meanwhile, Gov. Mark Dayton has proposed an expansion of the State’s child and dependent care credit, which, if approved by the Legislature, would provide nearly $100 million in tax relief to families.

Nursing Homes

With Minnesota’s elderly population on the rise, nursing home owners and workers have told Minnesota legislators that they are in need of more State money to stay open and retain staff. Care Providers of Minnesota is part of a Coalition, Long Term Care Imperative, that is advocating for a $200 million plan that would reform nursing homes reimbursements. They launched a campaign, “Face Aging MN,” to increase awareness among the public of aging and long-term care needs. The nursing home proposal would link more public money for higher nurse salaries to better quality of care. It also attempts to equalize reimbursement rates between rural and urban parts of the State, and expand health insurance options for employees. The nursing home proposal already has support among some key Republicans in the Minnesota House, including Aging and Long-Term Care Policy Committee Chair Joe Schomacker of Luverne. as well as DFL Human Services Finance Committee Chair Tony Lourey of Kerrick. The Lourey-Schomacker bill would connect nurses’ pay in an area to how much State money facilities receive.

Sunday Liquor Sales

Sen. Roger Reinert (DFL-Duluth) and Rep. Jenifer Loon (R-Eden Prairie) introduced legislation to repeal the State’s ban on Sunday liquor sales. Both lawmakers said with growing public support, they believe 2015 is the session to pass the bill. House Speaker Kurt Daudt supports repeal and Governor Dayton has indicated he would sign it if it comes to his desk. At a press conference announcing the bill, several liquor store owners were in attendance and one owner from a store in the Mall of America estimated her store would make $100,000 more a year in sales if open on Sundays.


Transportation Funding Issue Heats Up

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Right out of the gate, both chambers of the Minnesota Legislature put forward transportation funding packages. It has been called the issue of the session. The need for reliable, efficient transportation touches everyone in their daily lives.

Governor Dayton made it very clear that his number one priority for 2015 will be increased transportation funding for State roads, bridges and transit. The Governor will propose wholesale and retail gasoline taxes as one way to generate funding. The specifics of his proposal will be released later this month.

House Republicans countered that while they support additional funds for transportation, they prefer to do so within the context of the State’s estimated $1 billion budget surplus for the next biennium. House Transportation Chair Tim Kelly (R-Red Wing) introduced HF4 on January 8 which he said was designed as a short-term fix until the House could better determine the State’s real transportation needs. The bill seeks to use a mandated 15% efficiency savings across the Minnesota Department of Transportation. Of the total package, $750 million would come from existing funds or capital bonding with no need for new taxes. The bill would earmark $200 million toward local roads and bridges.

Senate Democrats followed up with introduction of their bill, SF87 by Transportation Chair Scott Dibble (DFL-Minneapolis) on January 12. The Minnesota Department of Transportation (MnDOT) estimates a $6 billion funding shortfall for transportation over the next 10 years. Sen. Dibble stated that the need is not complicated and has been well documented. He lamented that our roads are less safe, accidents costly, goods and services can’t get to market in an efficient manner, and without proper transport our youth, disabled, and seniors are forced out of homes and community. Sen. Dibble remarked that we can’t build enough roads to accommodate everyone and need to find transit options. By contrast, House Republicans have no proposal for mass transit in their bill. The Senate bill increases revenue for funding to just under $800 million, with an additional $567 million for local road and bridge repair and replacement, as well as rail grade and crossing improvements through General Obligation bonds. It imposes a sales tax on gasoline at the wholesale level of 6.5% and increases license tab fees. There is some concern that the wholesale gas tax could bring in less money than projected if the price at the pump stays at current low levels.

Sen. Dibble recognized that the Republicans are not in favor of funding along the lines included in this bill and that there will be tough negotiations ahead. Republican House Speaker Kurt Daudt says it’s unlikely Republicans will vote for a tax increase to raise revenue for transportation but promised to keep working with Democrats this session to find common ground.

2015 Minnesota Legislative Session Begins

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The Minnesota Legislature convened on Tuesday, January 6 at noon to begin the 2015 Minnesota Legislative session. The first day of session was marked by the swearing in of new members, organizational matters and other formalities. Most of the legislative business in January will consist of committee overviews of matters within their jurisdictions.

On Thursday, January 8, the DFL Senate leaders and Republican House leaders announced their key priorities for the upcoming session. The bills singled out by the leaders will mark the general focus and goals for these caucuses. Both plans emphasize job creation and education, but they take very different routes to get there.

Minnesota Senate Democrats proposed free education at the State’s two-year colleges, loan forgiveness for rural doctors and dentists, and a program to link up current minded students with employers. The other bills highlighted in the Senate DFL press conference also would fund early childhood education, child protection measures, and disaster relief for counties hit by storms. The House Republicans, on the other hand, emphasized reducing or removing regulatory barriers for business and reducing taxes as the best way to boost the State’s economy and generate jobs.

Governor Dayton will unveil his priorities for 2015 when he releases his proposed budget on January 27. However, speaking at the Minnesota Chamber of Commerce Session Priorities Dinner on Wednesday, January 7, Dayton made it very clear that his number one priority for 2015 will be increased transportation funding for State roads, bridges and transit. The Governor will propose wholesale and retail sale gasoline taxes as one way to generate funding. House Republicans countered that while they support additional funds for transportation, they prefer to do so within the context of the State’s estimated $1 billion budget surplus for the next biennium.

The physical constraints which will hamper the upcoming legislative session because of an extensive remodeling and updating of the State Capitol building have become clear. The project begun last summer and will continue through 2016. The constraints are so significant that Republican Senate Minority Leader David Hann of Eden Prairie is even proposing that the Legislature skip the 2016 session and complete any business required for the biennium during the 2015 session. Other legislative leaders admitted being intrigued by the possibility, but questioned how realistic it would be to accomplish.

Senate First Six

Senate Majority Leader Bakk said the State has a surplus because of the good work of the Legislature over the last two years. “We left $600 million on the bottom line to make sure the incoming legislature and Governor had a clean slate. Our proposals are scalable. We do not see a need for general fund spending increases.”

SF1 (Jensen) – Disaster Relief bill. Heavy rains last summer brought about major flooding in the State. FEMA funding was made available, but need a State match. The bill provides appropriations to the disaster assistance contingency account.

SF2 (Stumpf) – Education bill. The legislation grants tuition relief for qualifying high school seniors at a MNSCU site. It aims to address the shortage of skilled workers and match up unemployed workers with the employers that have vacancies. The bill encourages graduating seniors to enroll in community or technical college (provided they follow the set guidelines). The cost savings for students should cover about 50% of their education costs. The hope is that more students will go into trade and technical schools to aid in boosting rural economy.

SF3 (Clausen)- Jobs bill. The legislation provides loan forgiveness for doctors, mental health professionals, public health nurses, and dentists who agree to work in rural Minnesota. There is a critical shortage of dentists, healthcare professionals in rural Minnesota.

SF4 (Sheran) – Child Protection bill. The bill proposes stronger protection for children facing maltreatment. It would require records be kept on file for five years and enlist county agency involvement.

SF5 (Bonoff) – Jobs bill. The legislation addresses the PIPELINE, apprenticeship programs, creating a dual training competency grant program. It implements a “Earn while you Learn” proposal; the State will partner with business via the Minnesota Department of Employment and Economic Development for grant dollars to support the student classroom on-the-job-training.

SF6 (Hoffman) – Education bill. The bill takes all-day kindergarten to the next level with funding for universal all-day preschool for four year old students.

Transportation Chair Sen. Dibble said transportation will be an extremely important focus for the Senate. He explained that they won’t be introducing the bill until next week, saying it will reflect recommendations of the MoveMN coalition that wants to generate funding through tax hikes.

House First Five

In the House, Speaker Daudt characterized the first five bills as those that represent the priorities that Minnesotans care about. He maintained that he will work with anyone who wants to work with their caucus to achieve their goals.

HF1 (Kresha) – Tax bill. The bill provides new markets tax credit for mining, timber and high tech. It also contains a pass through tax credit for S Corps. and speeds up the permitting process for the Minnesota Pollution Control Agency from 90 days to 45 days.

HF2 (Loon) – Education bill. The legislation builds on the teacher evaluation process passed four years ago, and will be part of the process for teacher removal. It also seeks to streamline the process for teacher licensure including out of state teachers and offer flexibility for local school districts to bring in local community experts.

HF3 (Shomacker) – Long Term Care bill. The legislation introduces additional incentives for the long term care workforce. It offers a loan forgiveness program for certain health care workers and expands the scholarship program to nursing staff in long term care facilities to work toward a higher degree. The bill directs Minnesota Department of Employment and Economic Development to make long term care a priority in their workforce planning and establishes a long term care savings account along the same lines as an HSA. The new account would provide a tax credit for long term care costs for individuals who are not at retirement age to offset the cost of tax penalty for early retirement withdrawals.

HF4 (Kelly) – Transportation bill. The legislation seeks to use 15% efficiency savings across Minnesota Department of Transportation. $750 million of funding would come from existing funds with no need for new taxes. The bill would earmark $200 million toward local roads and bridges.

HF5 (Mack) – Health Care bill. The legislation seeks to bring about greater transparency and accountability for MNsure. The bill calls for requesting a federal waiver to allow for individuals to receive ACA tax credits outside of MNsure.