With an insider’s eye, Hot Dish tracks the tastiest bits of Minnesota’s political scene and keep you up-to-date on those elected to serve you.

Contributors in Minnesota: Patrick Condon, J. Patrick Coolican, Patricia Lopez, Ricardo Lopez, Abby Simons, and Glen Stubbe. Contributors in D.C.: Allison Sherry, Jim Spencer and intern Beena Raghavendran.

Posts about State budgets

Capitol renovation project needs $30M more from lawmakers

Posted by: Patrick Condon Updated: March 28, 2015 - 2:39 PM

Problems with water damage, additional need for security improvements and other unforeseen costs have added $30 million to the cost of a major State Capitol building renovation, Gov. Mark Dayton and lawmakers learned Friday. 

If the additional money is approved by lawmakers, it would push the total price of the multi-year renovation to about $300 million. Dayton and lawmakers discussed the additional costs Friday in a meeting of the panel overseeing the project, which also saw leading lawmakers second-guessing some of the decisions by the project's architects. 

The biggest chunk of the additional $30 million in costs, about $17 million, is tied to addressing what the architects described as "water intrusion and settlement." Last spring, demolition work tied to the renovation uncovered evidence of widespread water leaks into the Capitol basement, particularly underneath two outdoor staircases on the east and west sides of the building.

Dayton and lawmakers expressed some irritation about the idea of having to pony up more money for the project, but there seemed to be bipartisan agreement it was probably necessary. 

"I don't know what the alternative would be," Dayton said. Said Sen. Dave Senjem, R-Rochester: "This seems in order -- we're mobilized, we're in there already, let's do it right." 

The additional spending has to be approved through the legislative process. Senate Majority Leader Tom Bakk, DFL-Cook, said some of that might be able to come from construction bonds, but also suggested a portion may have to come directly from the general fund. 

About $20 million from a contingency fund for the project is mostly spent, which Dayton said was also unfortunate but not too surprising. 

"It's a huge building and it's 109 years old," Dayton said. 

After discussing the cost overruns, Dayton and lawmakers haggled with the project's planners about public access to the building. 

Severall senators were upset with tentative plans to park school buses and place handicapped parking spots directly at the building's front, facing south toward downtown St. Paul.

Bakk and Sen. Ann Rest, DFL-New Hope, expressed a strong preference that school buses could instead be parked along the building's east side, on Cedar Avenue. Bakk noted that a new Senate parking ramp under construction just north of the Capitol would have a lot of handicapped spots. 

Dayton, as he has previously, weighed in on the building's art. A recent assessment by Ted Lentz, an architect and member of the Capitol Area Architectual and Planning Board, valued the building's art assets as a stunning $1 billion, but Dayton has been critical of certain aspects of the art, suggesting it over-emphasizes Civil War battles and portraits of former governors. 

A subcommittee of the Capitol Preservation panel has been working on envisioning how to highlight existing art and possibly incorporate new art, too. The panel on Friday backed a request for $3 million in additional dollars to restore existing art that in some cases is damaged. 

Senate DFL budget just shy of $43 billion, sets aside $250M for rainy day fund

Posted by: Ricardo Lopez Updated: March 27, 2015 - 11:01 AM

Senate DFL leaders on Friday unveiled a broad budget outline that called for spending $42.7 billion in the upcoming biennium, about $250 million less than what Gov. Mark Dayton in his budget.

It follows the House Republican budget targets, released Tuesday, which called for a a budget of $40 billion, though it left out a chunk of spending. Republicans did not include in their total budget the more than $600 million in general fund dollars they would divert to road and bridge repairs in the next two years. Once that is factored in, as well as a $2-billion unspecified tax cut plan, the gap between the Dayton, DFL and GOP plans closes substantially.

The DFL proposal, characterized by Senate Majority Leader Tom Bakk as a "middle ground between the House Republican budget targets and Gov. Dayton's budget recommendations," would set aside $250 million to grow the state's budget reserve, or rainy day fund.

Bakk was vague Friday about what the DFL budget proposal will look like, but said details will become clearer in coming weeks as budget negotiations get underway. 

The plan calls for $1.14 billion in new spending, about $730 million less than the projected $1.87 billion budget surplus. Of that, nearly half will be dedicated to education.

DFLer's tax proposal calls for $200 million in tax cuts, which is likely to include property tax cuts, said Senate Taxes Chair Rod Skoe, DFL-Clearbrook.

In a statement, Senate Minority Leader David Hann, R-Eden Prairie, criticized the DFL budget targets. 

“The state budget should reflect Minnesotans’ values, but Senate Democrats clearly refuse to do the hard work Republicans are doing to eliminate wasteful spending," Hann said. "The Republican budget, on the other hand, is designed to increase family budgets and grow the state’s economy."

This is a developing story. Check back later for an update.

Minnesota House GOP wants $2B in unspecified tax relief

Posted by: Patrick Condon Updated: March 24, 2015 - 1:45 PM

Republican leaders in the Minnesota House proposed $40 billion in total state spending over the next two years, including $2 billion in unspecified tax relief.

The GOP spending plan, outlined Tuesday, is about $3 billion less than DFL Gov. Mark Dayton's proposed $43 billion budget plan for 2016-17. Dayton wants considerably less in tax relief, proposing a total of about $200 million in tax credits for child care, working families and school supply purchases. 

"Our priority, really, is to put money in the pockets of hard working Minnesota families," House Speaker Kurt Daudt said. However, GOP leaders have not yet laid out how they plan to distribute $2 billion in tax relief other than to say it won't be in direct rebate checks. 

The $2 billion tax cut proposal matches the size of the state's forecasted $1.9 billion budget surplus, which many Republicans have argued should be entirely returned to taxpayers. 

Under the Republican budget targets, most sectors of state government spending would see small spending increases from the current two-year cycle to the next. However, in some cases the GOP plan does not factor growth in the cost of delivering state services that's fueled by inflation, rising population and other factors.

As a result, some areas, most notably health and human services programs, would see a scaling back in the volume of assistance provided. 

"That's real cuts to people in this state in a time of huge budget surpluses," said House Minority Leader Paul Thissen, DFL-Minneapolis. 

For instance, Republicans proposed spending $11.6 billion on health and human services in 2016-17. That's about $440 million more than is being spent on such programs in 2014-15. However, the Minnesota Management and Budget office estimated that delivering those same services in 2016-17 as in 2014-15 would cost a total of $12.8 billion.

That gives DFLers ammunition to characterize the Republican plan as cutting more than $1 billion from human services. Republicans take issue with that terminology, arguing that cancelling anticipated spending shouldn't be characterized as a cut. 

"What Democrats did is hide spending in the next biennium," Daudt said. 

Republicans provided few details of how they'd achieve that $1 billion in health and human services program reductions. House Ways and Means Chairman Jim Knoblach, R-St. Cloud, said he hopes a large portion comes from culling ineligible people from the rolls of MinnesotaCare. Further details will emerge in the coming weeks as House committees chew over spending levels, he said. 

Republicans would dedicate real new dollars to both public schools and public colleges, although by $775 million less than what Dayton wants in additional new resources. While Dayton's proposed funding boost for higher education would allow two more years of tuition freezes at University of Minnesota and MNSCU schools, Knoblach said the GOP plan would probably only allow such a freeze at one or the other. 

Republicans would significantly trim spending in a couple areas. Agencies administering environmental and economic development programs would get less money in the next two years than they did in the last two. 

Republicans would boost spending in some areas besides schools. Knoblach said they'd seek to add $160 million over two years for nursing homes, and changes to the state formula by which tax money is distributed to nursing homes. Dayton wants less than that, calling for a $25 million increase. 

The Republican plan also directs $100 million into state reserve funds, and leaves $319 million unallocated for the time being. Knoblach said that could later be added to the reserves, could serve as a hedge against a future economic downturn or might still be spent in some fashion. 

Republicans  did not factor into their total budget number more than $600 million in general fund dollars they want to divert to road and bridge repairs in the next two years. If that spending is factored, the gap between the Dayton and GOP plans would shrink slightly. 

With the House GOP at about $40 billion in spending and Dayton at $43 billion, Senate DFLers are planning to unveil their own budget priorities this Friday. Senate Majority Leader Tom Bakk, DFL-Cook, has said his total spending figure would likely fall somewhere between Dayton and Daudt. 

After Friday, lawmakers leave St. Paul for a 10-day spring break. Upon returning, they'll launch into a six-week home stretch that will largely be focused on passing a final state budget ahead of the May 18 adjournment deadline. 

GOP lawmakers tout $7B, 10-year road and bridge plan with no gas tax hike

Posted by: Patrick Condon Updated: March 23, 2015 - 12:38 PM

Republican leaders of the Minnesota Legislature said Monday they have a plan to raise $7 billion over the next decade, without raising the gas tax, to pay for repairs to roads and bridges. 

House Speaker Kurt Daudt and other GOP lawmakers unveiled their proposal at a State Capitol press conference. It's a counterpoint to earlier, 10-year transportation proposals from Gov. Mark Dayton and Senate Democrats, who both favor a larger, $11 billion roads-and-transit plan funded with a new wholesale gas tax to accompany the existing per-gallon tax, higher license tab fees and a Twin Cities sales tax increase for transit projects. 

"We think this is what Minnesotans have been asking for," Daudt said. "They've been telling us they want an investment in our road and bridge infrastructure, and they don't want a gas tax increase."

The Republican proposal creates what its backers dubbed the "Transportation Stability Fund." It would re- direct to roads and bridge projects a series of existing vehicle-related sales taxes that currenty feed the state's general treasury. Those include a sales tax on auto parts, a sales tax on rental vehicles, and a sales tax on vehicle leasing. 

"If you ask Minnesotans if the money they spend on cars should be used on roads and bridges, the answer would be yes," said Sen. John Pederson, R-St. Cloud, the lead Senate Republican on transportation. 

Between them, those existing sources would raise $3 billion over a decade for immediate repairs to roads and bridges, and highway improvements in economically strategic areas. Other major sources of funding in the GOP proposal are $1.3 billion from highway bonds, $1 billion in general bonding, $1.2 billion from "realigning resources" at the Minnesota Department of Transportation and $228 million from the projected $1.9 billion state budget surplus. 

By proposing to shift existing sales taxes from the general fund, and skimming a portion of the surplus for roads, Republicans set the terms of a coming clash with Dayton and Senate DFLers. Leading Democrats including the governor have said they oppose taking money out of the general fund for transportation, arguing it leaves less money for schools and other state priorities. 

Daudt said the sheer size fo the nearly $2 billion surplus leaves lawmakers room to shift some toward roads and bridges without shorting other priorities. 

The GOP proposal also includes far less money for transit projects than what Dayton and many DFL lawmakers have sought. While the proposed metro sales tax hike in several DFL proposals would raise hundreds of millions in new, annual transit funds, the GOP plan directs a total of $64 million to transit statewide over the next two years. That would be split equally between transit in the metro area and outstate Minnesota, meaning just $16 million yearly for Twin Cities projects. 

GOP ROADS

Dayton pitches preschool money in classroom visit

Posted by: Patrick Condon Updated: March 20, 2015 - 10:50 AM

Crouching and sitting on a classroom floor, Gov. Mark Dayton mingled with four-year-olds Friday as he made a pitch for a hefty state spending increase for universal access to preschool in Minnesota. 

"You look like you're 65," observed one little boy. "Close. I'm 68," said Dayton, who interacted with kids for about 20 minutes as they sat in a group and later worked on iPads.

Dayton wants lawmakers to approve $348 million in new state spending so that every public school in the state could provide such classes. It's the biggest single general fund spending increase Dayton has proposed this year, and comprises about a fifth of the state's projected $1.9 billion budget surplus. 

The group of about 15 children in the pre-kindergarten class at Newport Elementary School were well-behaved despite an unusually large crowd of adults accompanying the governor -- aides and security, area state legislators, school district officials and reporters. Their teachers later said the good showing by the kids was a testament to the benefits of early learning. 

"We notice a huge difference between students who do pre-K and those who don't," said Brittany Vasecka, a pre-kindergarten teacher at the school. The classes are half-day and run five days a week. 

In all, 80 percent of students in the South Washington County district attend pre-kindergarten classes, district officials said. Under Dayton's proposal, both districts that already provide pre-kindergarten classes and those that don't would both be recipients of the money. 

"I don't think we should penalize the school districts that have made this commitment," Dayton said. 

But some education advocacy groups have jumped on that lack of a distinction. On Thursday, a business-backed nonprofit called Parent Aware for School Readiness released an analysis contending that about 70,000 low-income kids between birth and age 3 could have access to needed early learning programs if about $100 million less were to be spent on the universal preschool initiative.

In a news release, the group said that districts with high numbers of "wealthier families whose children are already likely to be ready for kindergarten" don't need the funding Dayton's proposal would provide. 

“That ought to be focused on younger children from low income families,” said Ericca Maas, executive director of the group. 

If Dayton and lawmakers were to make preschool access universal to four-year-olds, Maas said, “then next year all of us advocates will be back here saying, ‘what about the three-year-olds.’”

Dayton said he’d be open to more funding for even earlier learning programs. But he said diverting some money away from universal preschool access would run the risk of “pitting four-year-olds against three- and two-year-olds,” Dayton said. 

The DFL governor's preschool initiative is of a similiar character to one of his most-touted successes of his first term, when he and the DFL-led Legislature approved funding for universal all-day kindergarten. Dayton mentioned that success frequently during his successful re-election campaign last year. 

This year, Dayton must navigate the proposal through a GOP-led House, which has different priorities for both the budget surplus and in state management of schools. House Speaker Kurt Daudt and other Republicans, while calling universal preschool a worthy goal, have also suggested some means testing might be needed.

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