Minnesota House Republicans clashed with Senate DFLers on Monday after an attempt to rework a proposal to extend unemployment benefits for laid-off steel workers and provide tax reductions for businesses.

Hours after the House Ways and Means Committee passed measure to give laid-off steel workers another 26 weeks of unemployment benefits, Senate Majority Leader Tom Bakk said he would never accept the measure because it was still bound to unemployment tax cuts for businesses.

“The speaker knows full well I’m not going to pass the two-in-one bill,” said Bakk, DFL-Cook.

Senate DFLers were adamant that the unemployment benefits measure be separated from the proposal to cut business taxes. DFL Gov. Mark Dayton and many legislators had been hoping to pass the unemployment benefit extension in the first days of session, but the fight over the tax cuts is dimming hopes for a quick resolution.

Bakk confirmed that DFLers told Republicans that they could support giving Minnesota businesses a one-time tax credit of $258 million from the unemployment insurance trust fund (an earlier GOP proposal called for $272 million in tax cuts) and providing further relief when the fund’s balance rises above a federal threshold of financial health.

Those changes were included in the bill that passed with bipartisan support in the House panel on Monday.

House DFLers said they feel a strong urgency to bring relief to the Iron Range, where more than 2,000 miners and many others have been laid off in the past year.

Rep. Tim Mahoney, DFL-St. Paul, said he would vote for the measure “because we are under the gun … we have 6,000 people who are suffering on the Range.”

But Mahoney questioned the GOP’s insistence on weaving the two unrelated provisions together into the same bill, asking, “What’s the next thing we’re going to tie together?”

Republicans said tying the two measures together will help ensure the tax cuts have enough votes to become law.

“I suspect we’ll also get additional votes this way,” replied Rep. Jim Knoblach, R-St. Cloud.

Bakk told the Star Tribune he could have the tax cuts passed separately in the Senate and delivered to the GOP-controlled House by March 29 — just not in the same legislation. The Senate already passed a bill last week that solely addressed the extension of unemployment benefits for Iron Rangers.

DFL legislators also renewed their call for a comprehensive transportation funding package.

DFLers and Republicans last year could not agree on a multibillion-dollar measure to repair the state’s aging roads and bridges. DFLers wanted a gas tax hike that Republicans refused to accept and the GOP insisted on using the money in the current budget, which DFLers said was insufficient to deal with the need.

Meanwhile, a Senate DFL proposal to award paid family and medical leave to all Minnesotans passed its first hearing.

The legislation would set up an insurance program funded by a contributions from employers and employees and offer workers up to 12 weeks each of paid leave to address medical issues or take care of a new child or sick relative. Workers would receive between 55 and 80 percent of their old pay while on leave, which the lowest-wage workers being compensated the most.

Business lobbyists testified that the bill was well-intentioned but onerous. Chamber of Commerce lobbyist Cam Winton described the process of training people to fill in for workers on leave as an “operational nightmare.”


Staff writers Patrick Condon and J. Patrick Coolican contributed to this report.