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.
Suggesting any state government support for building a Minneapolis soccer stadium would be politically unpopular, Gov. Mark Dayton once again Thursday said he considers it highly unlikely that he or state legislators would provide subsidies to the emerging effort.
"I just think politically -- I think the term 'stadium fatigue' describes it," Dayton said Thursday, running through the last decade in which lawmakers approved major state funds to build Target Field, TCF Bank Stadium and the Vikings stadium now under construction. "That's with the Legislature, myself, the public. I just don't think there's any public appetite for taking on the financing of another stadium."
Major League Soccer Commissioner Don Garber was in Minneapolis a day earlier announcing the league's plans to move into Minnesota. A private group led by former UnitedHealth CEO Bill McGuire has set its sights on an site near downtown Minneapolis, but so far has declined to say whether the investors would seek a public subsidy.
Dayton said it's hard for him to comment on any prospect of a public subsidy. "I don't know what the ask is," he said. But as he did a day earlier, Dayton said the only sort of state response he could foresee would be in making routine transportation improvements to the site, which is near Interstate 94.
"If there's an exchange that MnDOT's involved in, that needs to be expanded, or there needs to be a new exit ramp" or the like, "I don't want to put myself into a corner and say none of that would be considered," Dayton said.
The governor said he was personally excited by the prospect of a new sports franchise. But he also said he didn't attend Wednesday's event because he didn't want to create the appearance he might be willing to back a major subsidy.
"I've tried to be very clear, in the indirect communications I've had with a number of principles, that in my view there's not going to be public support for subsidizing a new stadium," Dayton said. House Speaker Kurt Daudt, Senate Majority Leader Tom Bakk and Minneapolis Mayor Betsy Hodges have also spoken against the prospect of a subsidy.
"It's great you're coming. It's great you're trying to bring this franchise and excitement and opportunity to Minnesota," Dayton said. "But this time you're going to have to go it alone."
Even as Gov. Mark Dayton and top state lawmakers vow no state money to help build a new Minneapolis stadium for the Major League Soccer franchise announced Wednesday, leaders of the House and Senate are preparing to mount a push to approve Super Bowl-related tax breaks requested by the NFL.
Minneapolis is hosting the 2018 Super Bowl. Senate Majority Leader Tom Bakk, DFL-Cook, said Wednesday that last year, he and the other three top legislative leaders signed a letter to the NFL promising their best effort to secure Super Bowl-related tax breaks that several previous host cities extended.
The letter was requested by leaders of Minnesota's Super Bowl host committee and was included in their ultimately successful bid package to the NFL, Bakk said. House Speaker Kurt Daudt and Senate Minority Leader David Hann confirmed this account.
"We had an agreement we would help them try to figure out how to do this," Daudt said.
Bakk said he met a month ago with Ecolab CEO Doug Baker, a leader of the host committee. Baker told him the NFL was requesting $2.8 million in tax breaks over Super Bowl weekend, specifically in exemptions to taxes on hotel occupancy, sales taxes on NFL events and the state income taxes that team players, coaches and owners competing in the big game would normally be subject to.
"We didn't absolutely commit, but I do feel the four of us felt like now that we've got it, it wouldn't be fair not to follow through," Bakk said. He said recent Super Bowl hosts Indianapolis and New Orleans extended similar tax breaks.
Bakk said he and Daudt agree to try to find room for the provision in this year's catch-all tax bill. Daudt said even though the cost to the state is relatively small, he expects the issue to be controversial.
"If we can find a way to make that work and a way to pay for it, I'm happy to look at it," Daudt said. "Obviously it's going to require some discussion."
Dayton said Wednesday he is not in on discussions between Bakk, Daudt and the host group, though he previously had made public appearances with members of the group to tout Minnesota's bid.
"I believe that having to pay the income taxes of millionaire players and multimillionaire owners is excessive," Dayton said, openly questioning whether the provision could find sufficient support in the Legislature. Dayton said he likely wouldn't veto such a provision, but also said he would not promote it.
Details of the Super Bowl tax breaks emerged even as an official announcement came down Wednesday from Major League Soccer that it awarded a Minnesota franchise to an ownership group led by another Minnesota business titan, former UnitedHealth CEO Bill McGuire. That bid has been linked to the ongoing construction of the new football stadium, since that facility has been designed to potentiall accomodate professional soccer.
Despite that, McGuire's group is mulling a new stadium on the other side of downtown. Under the state's stadium agreement with the Vikings, team owners Zygi and Mark Wilf would have exclusive ownership rights to any soccer team that played in the Vikings stadium for the first five years.
Bakk, Daudt and Dayton have all said they do not support state subsidies for a separate soccer stadium. That has led to suggestions of pressure from the Vikings, but Bakk said that's not the case.
"We're building a stadium that can be used for soccer. We're not going to build a second one," Bakk said, adding he thinks that would be hugely unpopular with voters.
Bakk noted that the Vikings won't own the new stadium, and suggested McGuire's group could play in a temporary spot for five years before relocating to the Vikings stadium.
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.
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.