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Agreement over education funding clears way for special session

Office of the Governor
Gov. Mark Dayton visiting Westview Elementary on May 22.

After more than a week of back-and-forth negotiations — and on the same day nearly 9,500 layoff notices went out to state employees — Minnesota’s political leaders found a way to break an impasse that threatened to shut down parts of state government. 

On Monday, House Republicans and DFL Gov. Mark Dayton agreed to spend $525 million more on education over the next two years. That’s about $125 million more than the Legislature initially allocated in its education budget, which Dayton vetoed, but less than the $150 million Dayton insisted on in the 2015 session’s final days. The agreement takes leaders back to where they were in the final hours of the 2015 legislative session, when that $25 million difference was the sticking point in trying to work out an 11th-hour solution. 

The $25 million at issue is a tiny fraction of the state’s nearly $42 billion budget, but it’s enough to clear a path toward a special session to deal with outstanding budget bills, which may happen late this week or early next week, leaders said.

That would be weeks in advance of July 1, the start of the next fiscal year and the day those layoff notices would turn into actual layoffs.

Both Dayton and House Speaker Kurt Daudt expressed frustration by the lack of progress made in negotiations last week, and switched from negotiating in private at the governor’s residence to trading offers via dueling press conferences Monday. The pressure on the two leaders intensified as the state mailed off layoff notices to workers in more than a dozen state agencies, which is required one month in advance by state law. Earlier Monday, Myron Frans, the state’s chief finance commissioner, also briefed reporters about plans for heading into a “partial shutdown” if no agreement could be reached. 

“Frankly, I’m tired of chasing my tail for the last two weeks. We want this to be finished,” Daudt said Monday afternoon. “We think that folks who get layoff notices today ought to have some certainty.”

When asked if the standoff was over, Dayton said he and Republicans are “standing off on a diminishing number of details.”

“I have no intention to see this go to a June 30th showdown and possible shutdown,” he said. “I’m just not going to subject people to that.”

Still some disagreements

So what does the potential deal look like? Well, not every detail is settled in the education budget yet, and Dayton also vetoed a jobs package and an agriculture and environment bill after a messy conclusion to the 2015 session. But leaders say they’re close on a deal to close up those proposals as well. Here’s where the major outstanding issues stand: 

  • As part of the tentative agreement, Dayton abandoned his “number one priority,” a plan for universal preschool education. In return, Republicans agreed to drop two controversial proposals thrown into negotiations late last week, one to change teacher layoffs in the state and another to undo a Minnesota State High School League policy that allows transgender athletes to play on the team of their choice. But there’s still some disagreement about what programs should get more funding. One thing is certain: Dayton and Daudt have agreed to put $63 million of the new education money into the per-pupil spending formula, or a 2 percent increase in the formula each of the next two years.
  • Dayton conceded on a legislative proposal to eliminate the nearly 50-year-old Minnesota Pollution Control Agency Citizens Board, but a deal to create buffers around waterways passed by the Legislature will be preserved in the final agriculture and environmental budget.
  • A $100 million bonding bill failed to pass off the House floor on the last night of session, and Dayton said there’s still some disagreement on the details of a final construction package. He plans to leave negotiations on the bonding bill, which requires a supermajority to pass in both chambers, up to legislators. 
  • A provision changing the way the state auditor’s office works is causing some problems. Dayton is upset about a provision passed in a state government bill that would allow county governments to seek private firms to do annual audits, instead of the state auditor’s office. Republicans and Senate Democrats strongly support the provision, which they say will save local governments money and give them more flexibility, but Dayton has echoed current State Auditor Rebecca Otto in saying that private firms won’t be as transparent and accountable as the state office. “I won’t agree to it,” said Dayton, a former state auditor himself.

Dayton not giving up on universal preschool

Other than working out those final differences, legislative leaders and Dayton still have a few final steps they need to take. All four caucus leaders and the governor must sign off on a deal on when to hold the special session and exactly what will be addressed. Dayton said he wants the special session’s parameters to be “crystal clear” before he signs any agreement.

A final deal shouldn’t be too difficult to reach: DFL Senate Majority Leader Tom Bakk and DFL House Minority Leader Paul Thissen praised the governor Monday for bringing negotiations to a close.

“While I am disappointed House Republicans are unwilling to invest the additional funding we know our schools need, I agree with the governor that shutting down state government is not the responsible way to resolve these negotiations,” Bakk, who has left negotiations up to Dayton and Daudt, said in a statement. “Throughout this process we have kept the state workers and their families in our minds, and are unwilling to gamble with their future by forcing Minnesota to endure yet another state shutdown.”

But lawmakers have left much to settle next year. Initially, Daudt and Bakk agreed to leave $1 billion of a nearly $2 billion budget surplus on the bottom line after they hit an impasse over a package of tax credits and cuts and a proposal to raise gas taxes to pay for transportation projects. That number will shrink to $875 million with new education spending, but it could also grow even more by next session as state revenues continue to come in higher than projections.

And Dayton doesn’t plan to give up on his plan to pass universal preschool in the state, his “number one priority” this session.

“It took me four years to get taxes on the wealthiest 2 percent, and I’m not going to step back from this,” Dayton said. “I’m going to make sure next session or the session after that, whether I’m out of office, that we have this enacted for the benefit of all 4 year olds.”

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Comments (11)

  1. Submitted by Beth-Ann Bloom on 06/02/2015 - 10:01 am.

    Special Ed

    The vetoed bill had additional money for special ed. What has happened to that?

  2. Submitted by John Appelen on 06/02/2015 - 03:44 pm.

    Seems Like

    I find it amusing that Bakk praised Dayton, when the GOP apparently gave up $125,000,000 tax payer dollars and allowed the terrible LIFO Teacher Layoff Policy to continue. Both to the benefit of Ed MN. The GOP seems to be the more agreeable party.

  3. Submitted by Paul Udstrand on 06/02/2015 - 05:28 pm.

    I told you so.

    I said my money was on Dayton. Actually I find this to be somewhat encouraging. The republicans actually seem to be committed to demonstrating that they can control a legislative body and NOT shut the government down. I wasn’t sure they could do it.

    • Submitted by Bill Gleason on 06/02/2015 - 07:01 pm.

      You were right, Paul

      Because Dayton realized that the GOP couldn’t stand another shutdown. And so did Mr. Daudt, despite the chest-thumping of some in the Minnesota GOP party.

      Given what a disaster this year’s legislative session was, the GOP has a lot of catch-up work to do before the 2016 election.

      • Submitted by Paul Udstrand on 06/03/2015 - 09:49 am.


        Dayton get’s it, Bakk not so much. Unless Bakk just decided to let Dayton to the heavy lifting.

        While this is encouraging, we still have to keep in mind that the republicans barely met minimum requirement here, it’s a pretty low bar of achievement. Remember in the middle of one of the biggest agriculture crises in decades (bird flu) republican’s FAILED to pass an agriculture budget that could be signed into law. If you’re a rural voter who thought “divided” government was going to bring equity to out state MN, now you know… adding “magic” to any equation never yields results.

        • Submitted by John Appelen on 06/03/2015 - 04:07 pm.


          “Could be signed into law”

          All of the bills that passed both houses “could” have been signed into law.

          However, Dayton chose to slow down government for his personal agenda, As is his right as Governor. But responsibility for the delay, layoff notices and special session costs rest with him.

          • Submitted by Bill Willy on 06/03/2015 - 06:38 pm.

            So you agree

            From your statement it’s obvious you are in favor of all the provisions the omnibus bill in question contains and think it should not have been vetoed but passed into law by the Governor.


            • Submitted by John Appelen on 06/03/2015 - 07:55 pm.

              Please Help Me

              In which area did Gov Dayton know more than the combined body of both houses? From my simplistic view the DFL and GOP legislators worked together to pass reasonable compromises. Then Gov Dayton deemed the efforts of these people lacking, vetoed the bills, drove lay off notices, drove a special session, and generally is holding the well being of the state employees hostage.

              Now if this was Pawlenty, many of the commenters here would be crucifying him for his dictatorial actions. Yet since this Dayton all we read is praise for his daring forceful negotiations.

              I just find the double standard interesting.

              • Submitted by Bill Willy on 06/04/2015 - 07:57 am.

                Which area(s)

                Vetoed the K-12 education bill.

                Vetoed House File 846, the omnibus Natural Resources, Energy and Agriculture bill… Veto letter:


                Additional concerns expressed on behalf of a significant number of organizations and plain old Minnesotan citizens:


                Vetoed House File 1437, the omnibus Jobs and Energy bill… Veto letter:


                Interesting list of “funding deficits” in a year with a “$2 billion surplus,” no?

                As mentioned above, I find it interesting that you support those bills and chalk up the Governor’s concerns with them to his egomania and/or selfishness.

                • Submitted by John Appelen on 06/04/2015 - 11:13 am.

                  Priorites and Waste

                  If Minnesotans want reasonable tax bills, clean environment, cost effective public services and a strong business environment, trade offs need to occur.

                  Unfortunately Dayton wants to keep spending more and regulating more on pretty much everything. Please remember that I am against his silly mantra. “We have the money right now, so we should increase the long term cost of government services, oversight programs, etc.” Of course, I am also against the silly GOP mantra. “We have the money right now, so we should reduce the long term taxes.” It certainly is confusing being a rational moderate in a world of extremes.

                  Now back to dual standards. When Pawlenty took strong action was that wisdom or egomania / selfishness? Why or why not?

                  They both took / are taking months of cross party negotiations and said I know better.

  4. Submitted by dan iverson on 06/03/2015 - 07:24 am.

    Agriculture-environment bill

    You are wondering why Bakk is pleased? Dayton, under pressure from iron range politicians and Republicans has ceded more ground to the mining interests by removing critical oversight of mining activity in our state, notably paving the way for the mother of all environmental pigs, copper nickel mining. If one wants to intelligently predict the future, look to the past and copper nickel’s past is, if one can disregard the propaganda and biases and investigate with an open mind, a very real and grave threat to Minnesota’s most prized possession of pristine lakes and streams. The value of this outdoor heritage is most vividly portrayed every fish opener and holiday as thousands of average Minnesotan’s and fellow Americans run to our Nirvana of the north, only 200 miles from Minneapolis.
    We must not acquiesce to the near sighted greed and corruption of our elected representatives.

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