Minnesota budget plans firmed up in the House and Senate

The House will likely pass a budget measure on Thursday; the Senate will follow with its own soon afterward.

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The exterior of the Minnesota State Capitol prior to exterior renovation project.

Photo: Glen Stubbe, Star Tribune

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Minnesota legislators are moving quickly to spend money to make the state’s home care workers a bit better off, its low-income students less hungry at lunchtime and the state’s streets less bumpy.

In sharp contrast to recent years, Minnesota has a surplus rather than a deficit, allowing the Legislature to boost tax relief and provide more state aid for key programs. The state began the year with a $1.2 billion projected surplus. Legislators and Gov. Mark Dayton have already spent about $443 million on tax relief, some retroactive to 2013.

In the coming days, the Legislature will approve further plans for the extra money.

“We are pursuing a budget that will grow our economy from the middle out, while investing in bread-and-butter priorities to create more jobs and economic opportunity,” said House Speaker Paul Thissen, DFL-Minneapolis.

The House plans to vote on the budget measure Thursday, with the Senate following suit within days, according to Senate Majority Leader Tom Bakk.

For Bakk, DFL-Cook, and a bipartisan cohort of lawmakers, the key facet of the budget plan is the 5 percent pay boost it would give to nursing homes and community-based caregivers.

“I feel awful good about that,” Bakk said. The Senate could approve its budget bill on Monday, which would set up lawmakers to create a joint negotiating committee to work out differences between the two bills in coming weeks.

Both the House and Senate measures include the 5 percent rate increase to home and community-based health care workers.

Dayton began the session backing only a 4 percent increase for those workers who care for the disabled and elderly. But spokesman Matt Swenson said Monday that the DFL governor now supports a 5 percent increase.

In the House bill, those nursing home and caregiver increases would cost the state about $91 million in the short term.

While those plans satisfy both Republican and Democratic desires, Republican Rep. Greg Davids said he fears other parts of the measure could have lasting impact. “It’s going to leave the next Legislature a big hole,” said Davids, of Preston. He said the way the measure arranges health care spending, particularly in light of outlays needed to comply with the federal Affordable Care Act, could snap back next year.

The Legislature also plans to use some of the surplus money to help local governments fill potholes left after one of the worst winters ever. The House version would send $15 million to cities and counties to smooth out rutted roads statewide.

“We’re facing one of the most severe pothole seasons,” said Rep. Frank Hornstein, DFL-Minneapolis. “Every Minnesotan has a story about the route they are driving that has huge potholes. … This is a very urgent priority.”

Schools could get an extra $3.5 million to ensure that low-income pupils whose parents pay some of their lunch costs will always get a lunch to eat. Lawmakers were outraged to learn that some schools were taking hot lunches from low-income kids and giving them a cold sandwich or stamping students’ hands with words “lunch” or “money” for all to see.

Tax cuts already in

In March, Dayton signed into law a measure to provide immediate tax relief for low-income families, college students, parents who got their employers’ help to adopt children, educators who paid for classroom supplies and others. Those groups will get a state income tax break on their 2013 taxes.

The House plans to follow that up with a second measure that would give $103 million in tax relief to farmers, renters, homeowners and business property owners.

“I don’t know how people would explain that more property tax relief isn’t a good idea,” House Taxes Committee Chairwoman Ann Lenczewski, DFL-Bloomington, said last week.

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