Senate Republicans failed Monday to rush a $500 million tax relief package from the DFL-led House to a final floor vote in the DFL-led Senate.
“Minnesotans are working on their tax returns right now, and they deserve a clear answer from the Legislature on tax reform,” said Senate Minority Leader David Hann, R-Eden Prairie. “The House was able to move quickly on this issue. Senate Republicans think it’s vitally important to citizens of the state that we do the same. There’s no reason to delay.”
DFL Senate leaders said they want to hold public hearings on a plan the House overwhelmingly approved last week.
“This is a very large proposal,” said Assistant Senate Majority Leader Katie Sieben, DFL-Newport. The Senate, she said, wants to “hear from the public on the components that will go into it.”
Hann said he suspects the Senate DFLers are intentionally holding up the tax proposal to keep it as a possible bargaining chip for other measures, like a proposed $90 million Senate office building and parking ramp that is stalled in the House.
The building issue must be resolved “before we have movement on these other major things,” Hann said.
Sieben said the Senate Taxes Committee “isn’t trying to hold anything up. They are moving ahead as quickly as possible, keeping in mind that there is a process in the Senate.”
The proposal includes tax breaks for middle-income Minnesotans and it would repeal new business sales taxes on warehousing services and telecommunications equipment and repair, changes strongly supported by DFL Gov. Mark Dayton.
Dayton wanted legislators to pass the tax breaks by this Friday, giving Revenue Department officials time to implement the changes before Tax Day. Some of the changes would be retroactive for the 2013 tax year, like the working-family credit, student loan interest deduction and tax breaks for consumers who lost their homes to foreclosure.
The Dayton administration is not looking to make elimination of the so-called marriage penalty retroactive, saying that it would be too cumbersome and expensive to adjust tax returns for 650,000 tax filers at the last minute.
Sieben said that legislators probably will not meet Dayton’s deadline, but that tax relief could get final passage soon after.
GOP candidate bows out
The Republican Party’s lone secretary of state candidate, Dennis Nguyen, abruptly dropped out of the race on Monday.
Nguyen, who had captured early support from Republican legislators, had seen some of his backing dissipate last week after revelations that he visited strip clubs.
With at least a few of his previous backers withdrawing their support, Nguyen said he was choosing to spend more time with his four children from a previous marriage.
In addition, he said, “With my many ongoing obligations, both business and civic, it would be difficult, if not impossible, for me to make a full-time commitment to a statewide campaign at this time.”
Sen. Branden Petersen, R-Andover, who has been a spokesman for Nguyen’s campaign, said “a few people … not many” withdrew their support. He confirmed that Nguyen, who is divorced, had been to a strip club.
Secretary of State Mark Ritchie is not running for a third term, leaving the seat open. Two DFL state representatives — Steve Simon of Hopkins and Debra Hilstrom of Brooklyn Center — are vying for the seat.
RACHEL E. STASSEN-BERGER
February tax revenue slips
Minnesota’s tax revenue collections fell slightly below projections in February, coming in about $17 million below the estimate of $1.16 billion.
Individual income tax and sales tax collections beat projections by about $19 million. Corporate income taxes and other tax revenue were down for the month by $35.4 million.
Minnesota Management and Budget officials urged caution interpreting the numbers, which are a brief snapshot in a two-year budget cycle. “Wide swings in variances may be caused by variations in the rate at which receipts are received and processed and differences in the rate at which refunds are issued,” the department said in a statement.