Minnesotans are divided on what their political leaders should do with $1.2 billion in surplus state dollars, with nearly equal support in a Star Tribune poll for refunding it to taxpayers, spending it or saving it.
Offered those three choices, 30 percent said it should be refunded, and the same amount said save it. Another 31 percent said spend it, with the greatest support for roads as the top spending priority, followed by public schools.
“Give it back to taxpayers,” said Shawnna McCorvey, a 45-year-old human resources consultant from Minneapolis. While she described herself as a Democrat, McCorvey fondly recalled how in a previous time of ample surplus, former Gov. Jesse Ventura successfully championed a one-time sales tax rebate in 2000 that amounted to about $600 a person.
“Jesse checks!” McCorvey said. “I was like, he’s the best governor ever. It was wonderful.”
The coming debate at the State Capitol over what to do with this year’s surplus is likely to be among the most contentious in a legislative session that starts on March 8. DFL Gov. Mark Dayton has said he thinks the Ventura-era tax cuts were too deep, and wants the current surplus split between spending and some tax reductions.
Dayton has credited Minnesota’s economic performance with creating the budget surplus. But Republicans who control the House call it a case of overtaxation and have vowed that cutting taxes would be the party’s top priority at the Capitol this year. Last year, the House passed a GOP-crafted plan for a new, $1,000-per person income tax exemption that would expire after two years.
The Minnesota Department of Revenue estimated it would mean an average annual tax cut of $130 per household.
“I don’t see what the point in giving us a tax cut is,” said Happie Bergquist, a retired nurse from Princeton. A Democrat, Bergquist sees many pressing needs in her community. Asked for an example, she said a friend of many years recently found himself homeless.
“He can’t get a job because he doesn’t have a place to live and he can’t get a place to live because he can’t get a job,” Bergquist said. “The homeless, so many of our senior citizens — I know everybody thinks they get enough help already but they really don’t. They’re not getting what they need to get by.”
Asked which areas of state spending should be the priority with the budget surplus dollars, 27 percent said health or social programs.
Another 27 percent said public schools, while just 3 percent said public higher education institutions. The biggest winner was roads, at 38 percent.
“Traffic is pretty bad, the roads are a wreck, a number of bridges have to be repaired,” said Matt Clark, a 35-year-old salesman from Eden Prairie who called himself a moderate Republican. “If you’ve got the money, it’d be nice to see a little effort to get more quickly to these things.”
Clark said he thinks public schools are also deserving of additional spending. That said, he thinks the majority of the surplus should be returned to taxpayers. “That way we can pump it back into the economy,” he said.
The Star Tribune Minnesota Poll interviewed 800 registered voters around the state from Jan. 18-20. It has a margin of sampling error of 3.5 percentage points, plus or minus, and included interviews on both land lines and cellphones.
Views about what to do with the surplus, and what should be the spending priorities, vary in different parts of the state and along demographic lines. The highest support for spending most of it is in Hennepin and Ramsey counties, the DFL’s biggest political stronghold.
Men are more likely to support cutting taxes or spending the money, while the strongest support for spending it is among women.
Age-wise, voters between the ages of 18 and 34 were least likely to support spending it and most likely to support saving it.
A majority of Democrats favor spending the surplus on government programs and projects, while Republicans were more closely split between refunding it and saving it.
“I think we definitely need to reinvest in our youth, and I think education is the way to do that,” said Kathi Gregerson, a 57-year-old nurse in Albert Lea and an independent voter. “So many of the schools are cutting. Teachers have to put their own money into supplies and books. Kids are graduating and they don’t know how to write a proper sentence.”
The actual size of Minnesota’s surplus is $1.9 billion, but under current state law about $700 million will be automatically diverted into a budget reserve fund.
Dayton later in March is expected to release his plan for what to do with the surplus. He has already proposed $100 million be spent expanding high-speed Internet access in rural Minnesota, and said he intends to push again for new spending for public schools, and transportation infrastructure. Dayton and DFLers who control the state Senate have also signaled support for an effort to reduce local property taxes.
In addition to the income tax exemption, House Republicans’ tax plan from last year eliminated the state’s property tax on business owners, and included a mix of credits and exemptions benefiting senior citizens, veterans, farmers and college students. Many of those ideas are likely to find a way back into this year’s debate.
Mark Olson, a 25-year-old bank employee who “generally” considers himself a Republican, doesn’t see a big need for tax cuts. Olson wants “a big pile of taxpayer money to go to roads,” specifically mentioning the condition of Interstate 94 between Minneapolis, where he lives, and St. Paul, where he works.
“Those bumps are ridiculous,” he said. “My car should not jump a foot in the air when I’m going 55.”