ST. PAUL, Minn. — Gov. Mark Dayton vetoed massive tax and budget bills on Wednesday that Minnesota lawmakers passed in the waning days of the session, setting off a cascade of consequences that he blamed on Republican majorities for not negotiating in earnest.
While Dayton's veto was largely expected, top Republicans responded Wednesday by calling it "vindictive" and branding the governor "a failure."
The Democratic governor's veto of the tax bill means all Minnesota taxpayers will face a more complex filing season next year, and some families and businesses may be taxed more heavily. It also prevents funding going out for schools to make security improvements, money to help public schools fill budget deficits, reimbursement for local offices who have struggled with the state's new driver registration system, opioid abuse prevention efforts and more.
The Legislature had already passed a two-year budget last year. Dayton's veto means some major tweaks and top priorities won't become law.
Dayton said the Republican tax bill was skewed too heavily toward corporations and wealthier residents, noting a modest income tax rate cut would net larger benefits for the highest earners.
He called the bills a result of political gamesmanship and not sound policymaking.
"They wanted their talking points, they wanted re-election, election campaign slogans. And that's exactly what they're already doing," Dayton said. "Reaching an agreement with me was not part of their game plan."
Republican Senate Majority Leader Paul Gazelka and House Speaker Kurt Daudt said they were blindsided by the vetoes, with Daudt lashing out at Dayton: "This session isn't a failure. Our governor is a failure."
Gazelka said rattled off a long list of Minnesota residents who he said would be harmed by Dayton's decision, including people with disabilities and their caretakers who face a budget cut and Secretary of State Steve Simon, who needed authorization to access federal money to boost election cybersecurity.
"In the end, it feels impulsive, it feels vindictive and it didn't help anybody in Minnesota," Gazelka said.
Dayton isn't seeking a third term. Members of the House, currently controlled by Republicans 77-56, are up for election in November. Senators are not on the ballot.
Dayton accused Republicans of loading up a massive budget bill to try to force his signature, including funding for opioid abuse prevention and revamping oversight of senior care facilities. Republicans argued they removed more than half of the provisions Dayton had demanded be pulled out and stressed they provided $225 million to 59 Minnesota schools suffering budget shortfalls — though less than a quarter of that funding was new money.
Dayton called it "fake education funding."
And one of the marquee issues of the session remains unfinished. The Legislature needed to tweak its tax code to account for the big federal overhaul passed late last year.
Department of Revenue Commissioner Cynthia Bauerly, the state's top tax official, said work is underway to make sure Minnesotans can still easily file their taxes even without a so-called conformity bill. She said no vendors such as TurboTax have indicated they would leave Minnesota or raise their prices, but that residents who itemize their taxes may need to answer more questions or provide more receipts.
Dayton downplayed the consequences of the legislative impasse, and reiterated that he would not call lawmakers back to try again in a special session. He suggested lawmakers could make corrections to the tax code when a new Legislature — and governor — returns in January.
"I'm not saying that's a good way to approach this, but the sky is not falling," he said. "It could and should have been avoided," Dayton said.