DFL still a long way from deal on budget

  • Article by: BAIRD HELGESON , Star Tribune
  • Updated: April 14, 2013 - 7:55 PM
House Speaker Paul Thissen
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House Speaker Paul Thissen

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DFL legislative leaders are trying to convey a sense of calm and harmony, but beneath the surface they are scrambling to piece together a budget deal, sort out a funding shortfall for the new Minnesota Vikings stadium and avoid chasing off Mayo Clinic, the state’s largest private employer.

Heading into the session’s final stretch, Democrats also are digging in on tax increases despite heavy criticism from Republicans and business groups.

“We are not shying away from the fact that we need to raise taxes to invest in education and job creation and property tax relief,” said House Speaker Paul Thissen, DFL-Minneapolis.

It’s a treacherous political landscape and outside groups are already taking to the airwaves to land body blows during the crucial weeks before the Legislature adjourns on May 20 and campaign season gets underway.

“It’s about spending, and spending too much,” said Charlie Weaver, executive director of the Minnesota Business Partnership, which is part of a group that launched $600,000 in advertising to bash proposed tax hikes.

While many budget pieces are in play, some key elements are coming into focus.

Legislators will probably approve some version of DFL Gov. Mark Dayton’s signature campaign pledge — an income tax hike on high earners. Dayton would use the money to erase the state’s projected $627 million deficit and improve education.

“Everybody expects Dayton’s insistence to tax higher earners to become law,” said House Taxes Chairwoman Rep. Ann Lenczewski, DFL-Bloomington.

But one-party rule is not entirely harmonious.

Senate Majority Leader Tom Bakk said his caucus may propose raising income taxes on the wealthiest 5 percent of Minnesotans. That would more than double the number of taxpayers that Dayton would tap and could reach down into what many Minnesotans consider the middle-class.

Dayton says no to gas tax

There is still no consensus on whether to expand sales taxes, back another pricey construction project or accelerate the payback of $808 million still owed to public schools.

Dayton has already sent strong signals about what he will not do, forcing the House and Senate to pull back expansive transit plans when he gave a thumbs down to raising the gasoline tax.

He has not yet said whether he will back the Senate’s proposal for a clothing tax, but does not appear to be receptive.

The House and Senate have lined up behind all-day kindergarten, but the House also would tack on a surcharge for upper-income earners to speed repayment of school debt.

The governor and Legislature are more than $300 million apart on health and human services, with legislators proposing cuts.

To pay for their wish-lists, legislators are exploring an array of other taxes, including tobacco, alcohol, clothing and consumer services.

“So this is taxing the rich, huh?” asked Senate Minority Leader David Hann, an Eden Prairie Republican. “This is excessive. We don’t need to burden hardworking taxpayers by taking more money out of their pocket.”

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House Speaker Paul Thissen