Gov. Mark Dayton shot down the notion of linking negotiations over the $750 million bonding proposal he outlined Monday to the significant tax increases DFLers have been pushing for this session.
That muddies how Dayton will secure GOP votes for the state infrastructure plan — which requires 60 percent legislative support to pass — because it leaves little on the table to offer Republicans who have so far appeared lukewarm toward increased state borrowing this session.
“Obviously it won’t pass if there aren’t Republicans who will support it,” Dayton told a crowded room of reporters on Monday, when he outlined his last major policy goal of the session.
Among its proposals, the governor’s bonding plan allocates $109 million for renovations to the state Capitol; $139 million for local government projects, including convention centers in Mankato, Rochester and St. Cloud; roughly $140 million for higher-education facility upgrades; and $47 million for transit.
Cited jobs for 20,000+
Dayton has been a huge advocate for bonding as an economic development tool, and argued at the Monday press conference that his bill would put more than 20,000 Minnesotans to work.
The governor, who is looking for $1.8 billion in tax hikes as part of his budget, told reporters that he would push back against tying those revenue increases to his bonding bill, another key session priority.
“They’ve been separate issues in the past,” Dayton said of bonding and tax proposals. “I think there’s a separation in there, clearly, and I would resist efforts to link them.”
“Ultimately, legislators have to decide whether they’re going to support 21,000 jobs or not,” the governor added. “To me, that’s an overwhelming imperative … to put people to work throughout Minnesota.”
Talking points aside, there’s no clear avenue forward for lawmakers to pass a bonding bill, though that isn’t necessarily a historic departure when it comes to such legislation.
2011 bonding was part of big compromise
The 2011 bonding legislation came as part of a larger budget deal between Dayton and the then-GOP legislative majorities. The governor walked away with a surprise borrowing bill in the summer of 2011 as part of the compromise that ended Minnesota’s historic government shutdown.
While Dayton touts the employment figures a bonding bill would create, the GOP has so far questioned the fiscal responsibility of added debt. Executive branch budget officials, though, say Dayton’s proposal – and another bill of a similar size next year – is within the state’s allocated responsible debt limit.
House Minority Leader Kurt Daudt reaffirmed on Monday that he’d like to tackle the DFL’s budget proposals before focusing on borrowing legislation.
“They haven’t even rolled out the budget yet,” he said.
But Daudt also welcomed negotiations that would combine both the budget and bonding — which Dayton is working against — because “I think it gives us more power,” he said.
“They need [Republican] votes on the bonding bill,” Daudt said. “They don’t need our votes on the budget.”
The Republican from Crown could push for lower tax hikes from Democrats – the House is looking for $2.4 billion in new revenue and the Senate wants $2 billion in tax increases – in exchange for GOP votes on an infrastructure bill.
Daudt said he hadn’t had serious discussions about the governor’s proposal and noted that even-numbered years are typically reserved for borrowing bills.
Common ground: Capitol restoration
There is one area of common ground in the governor’s bonding plan – $109 million for state Capitol restoration – that legislative leaders from both parties have said they support. That figure represents what the state must put forward to keep the roughly $240 million project on track this year.
Department of Administration Commissioner Spencer Cronk told reporters that the Capitol building is at a “tipping point,” and said lawmakers must decide if they want to spend the money to settle the project “once and for all for the next hundred years” or “see this is in a constant state of asset preservation” with a piecemeal approach.
Dayton said he understands why previous governors and Legislatures put off the expensive renovations, calling them “not a pleasant undertaking.”
“It was easier to avoid until it reached the point it couldn’t be responsibly avoided any longer,” he said.
Whether the Capitol renovations will be enough to tip Republican support for the entire proposal is unclear.
Projects are 43% metro
Dayton said he hadn’t looked at a breakdown of projects between DFL and GOP controlled districts. But the projects are broken down as 43 percent in the metro area (though that number is skewed by the mammoth Capitol restoration), 34 percent in greater Minnesota and 23 percent deemed as “statewide” assets.
A nifty interactive map of the different projects can be found here.
The House is expected to release a roughly $800 million bonding bill on Tuesday, a target that Dayton said was within an acceptable range for negotiations.
Dayton said his $750 million bill came from a pool of roughly $2.5 billion in eligible projects. The governor, as he has in the past, lamented that he didn’t have the opportunity to fund a larger share.
“There are a lot of really vitally needed projects that had to be left out.”
It’s a very disappointing list
when we are being told that we don’t have enough tax revenue to fund schools, social programs, etc. After all, bonds are debt that require principle and interest payments that have to come from some revenue source.
Certainly understand and support building maintenance, sewer upgrades and road repairs. But we don’t need to be spending anything on stadiums, convention centers, snow monkeys, etc, if in fact we are short of money for schools, etc.
I hope the legislature cuts it back.
The Governor is right
Tax (budget) bills this year, bonding bills next year. That’s how to keep them separate.