Dayton wants $842M in debt-backed public construction projects

(This post has been updated)

Gov. Mark Dayton on Tuesday called for $842 million in public-oriented construction projects, saying the debt the state would incur to bankroll them is worth the economic jolt it would provide.

"My proposal would put thousands of Minnesotans to work throughout our state," Dayton said at a Capitol news conference, laying out a hefty wishlist that includes money for college campuses, local economic development projects, rail and pipeline safety initiatives, workforce housing, the State Capitol renovation, to replace the visitor center at Fort Snelling and dozens of other projects.

A complete list of Dayton's proposed projects can be found at this link. A map of the projects and regional breakdowns can be found here. Citing an academic analysis, Dayton's administration said enacting his entire proposal would create 23,900 jobs in Minnesota.

Legislative tradition, and reluctance among House Republicans, means a tough road ahead for Dayton's construction plan.

Lawmakers frequently note that large bonding bills have more often been passed in even-numbered years of the two-yaer legislative cycle, after lawmakers dispense with the state budget in odd-numbered years.

But Dayton noted that has been far from a hard and fast rule. He said research by his staff showed that lawmakers have approved some level of bonding in 31 of the last 32 years, and said the state's good economic circumstances justify an ambitious approach to construction.

"I think this is a perfect opportunity. Interest rates are low, we have a budget surplus, and there are all these projects backed up," Dayton said. He said the $842 million project list was whittled down from $1.9 billion in requests.

But that's not a hard and fast rule. Dayton in particular has been an advocate of frequent and sizable bonding bills, arguing that the civic centers, campus buildings, public works upgrades and other physical improvements they bring to communities help foster local economic activity.

As he has previously House Speaker Kurt Daudt, R-Crown, on Tuesday said the House was not likely to take up a bonding bill this year. Having just seized the House majority last fall, Daudt said, Republicans have not had sufficient time to fully vet nearly $2 billion in bonding requests.

House Republicans also want to leverage the state's debt capacity to cover some costs of their transportation plan, their current strategy is to push through that portion of funding next year.

Since bonding bills originate in the House, Senate Majority Leader Tom Bakk, DFL-Cook, has said the Senate is likely to follow the House's lead. Still, Bakk said prior to the legislative break that Senate DFLers might still assemble a bonding proposal.

Bonding bills are unusual in that issuing debt on the state's behalf requires votes of three-fifths of the members of the House and Senate. That makes bipartisan cooperation necessary.