A new session, a familiar divide

The DFL majority plans to charge boldly into the 2008 legislative session today with proposals for gasoline tax increases, universal health care and more that appear destined for a collision with Republican Gov. Tim Pawlenty.

DFLers began squaring off on Monday, with Senate Majority Leader Larry Pogemiller of Minneapolis saying that Republican rule had set the state on a "march to mediocrity" that DFLers intended to halt. "We can do better than that," he said.

DFLers today will propose a transportation bill phasing in a gas tax increase of 7 1/2 cents per gallon, increase license tab fees and boost the metro sales tax for transit.

Republicans have already signaled their resistance to any tax increases. Pawlenty has said he could support a 5-cent-per-gallon tax hike if it was paired with an offsetting tax cut.

Republicans, who upheld Pawlenty's veto of a smaller transportation bill last year, have said they would uphold vetoes this year as well. DFLers need to win over at least five House Republican votes to override a veto.

The DFL's proposed gas tax increase would raise roughly $1.4 billion per year to help slash a multibillion-dollar backlog of road and bridge projects across the state.

Holding big majorities in the House and Senate, DFLers said they also will use their muscle to push through a nearly $1 billion bonding bill that they said would "jump-start" the state's ailing economy.

But hopes for speedy passage of a bonding bill may already be hitting obstacles. Pawlenty wants to use much of the state's borrowing capacity to fund road and bridge projects, while DFLers want to pay for them with increased transportation revenues, reserving borrowing for other public building needs.

In an indication of the hardball tactics to come, Pogemiller said that DFLers would not take up the bonding bill, always popular with lawmakers in an election year, until the transportation bill had passed.

The transportation bill to be introduced today would also include a borrowing component partly to create an "ailing bridge" fund, and would call for an immediate 2-cent gas tax hike, another 3-cent increase this fall and a subsequent additional 2 1/2-cent increase that would be temporary.

The bill would also include a metro sales tax and a license tab fee increase. Senate Transportation Committee Chairman Steve Murphy, DFL-Red Wing, said it would hit hardest on new luxury vehicles. The buyers of four-to-six-year-old cars, he said, would pay a "tad bit more" under the proposal.

Republicans have own agenda

McClung said "job one is to protect Minnesota taxpayers."

Added House Minority Leader Marty Siefert, R-Marshall: "This is a really bad time to be soaking families." He said if DFLers are serious about passing a transportation bill by Easter, "they need to give tax increases up for Lent."

Pawlenty will lay out his own session agenda on Wednesday, when he gives his State of the State address in St. Cloud. McClung offered no details, but said Pawlenty would offer initiatives to further the state's ambitious renewable energy goals, education reform, and achievable health-care reform.

Health differences, too

Pawlenty and lawmakers have been working for months on a bipartisan plan for health care, but their paths may be diverging there, too. McClung said the governor would not support mandates to require individuals to carry health insurance and would oppose any additional increases to the state's cigarette tax -- chief features of the DFL's leading plans.

The proposed Minnesota Health Plan was touted as the most effective way to use savings resulting from lower insurance overhead and other cost reductions to provide coverage for an estimated 400,000 uninsured Minnesotans.

The effort is being led largely by new House members, who say they are responding to numerous complaints about health insurance while campaigning in 2006 and expect to wage a three or four-year fight for their plan.

The single-payer plan will compete with less dramatic proposals for health coverage reform. Some longtime DFL proponents of a health-care overhaul favor universal insurance that stops short of a single-payer system.

Budget troubles loom

Plans on all sides come amid a steadily worsening financial picture that could eclipse every other topic at the Capitol.

Collections of all three of the state's major taxes are running below projections.

A $373 million projected state budget deficit is expected to grow by the end of the month, when a new state economic forecast is released.