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Deal and no deal: legislative leaders agree on budget and taxes, remain stalled on transportation and bonding

MinnPost photo by Briana Bierschbach
A view of the Minnesota State Capitol building at sunset Saturday night from the Senate Office Building where negotiations went well into the night.

There was no big unveiling of a global deal to end the 2016 session, but piece-by-piece over the weekend, a divided Legislature inched toward agreements on everything from presidential primaries and police body cameras to how to spend a $900 million budget surplus.

By Sunday morning, lawmakers agreed to pass a $260 million bill of tax cuts and credits and a supplemental budget bill that spends $300 million out of the surplus. A deal on transportation and bonding were still outstanding, but legislators were trading offers all day Saturday in hopes of reaching a last-minute agreement. 

But they are running out of time. Lawmakers need to sort out outstanding issues and pass all bills before midnight on Sunday, the deadline to complete business for the two-year lawmaking cycle. They must constitutionally adjourn on Monday.

Wide-ranging tax bill

The tax bill, the first agreement reached, will cost $550 million in the next two-year budget. The proposal includes: deductions and credits for families with a 529 college savings plan; credits up to $1,000 for Minnesotans with student loans; property tax reductions for farmers in Greater Minnesota; property tax cuts for small businesses; an expansion of tax credits for veterans; and expanded child care credits for families, which was a priority for Gov. Mark Dayton. 

Gov. Mark Dayton
MinnPost file photo by James NordGov. Mark Dayton

Property tax breaks for a major league soccer stadium in St. Paul were also included in the compromise, although legislators did not exempt construction materials from sales taxes, another request from St. Paul and the owners of Minnesota United FC. 

On Friday evening, DFL Gov. Mark Dayton called the tax proposal “within the ballpark of fiscal responsibility,” but added that he would not sign any tax bill without a budget bill he finds acceptable. 

A breakthrough on the supplemental budget didn’t come until Saturday afternoon, when top legislative leaders began sending pieces of the deal off to committees in order to get the work done on time. Under the agreement, legislators will spend an additional $300 million over the next year, including $35 million for racial equity proposals (with some spending ongoing), plus another $35 million to expand broadband infrastructure. Dayton scored $25 million in the budget bill for his signature preschool program, which will be voluntary and grant-based. 

Stuck on bonding and transportation

Meanwhile, talks were stalled on two issues that have been intertwined all year: the bonding bill and transportation funding.

Members of the capital investment conference committee went in and out of meetings all day Saturday, with the Senate offering to come down from its original $1.5 billion bonding bill to $1.4 billion, but Republicans said that wasn’t enough of a reduction. They offered up an $800 million bonding bill originally. 

State Rep. Tim Kelly
State Rep. Tim Kelly

The transportation conference committee, where a long-term funding deal has been stalled since last year, was also in and out of meetings, but made no progress. Democrats offered Republicans two choices on the issue: a one-time package of $300 million from the surplus for roads and bridges and $300 million more in bonding; or an option that allows metro counties to raise sales taxes for ongoing transit funding and asks voters to dedicate certain money from the state’s general fund to roads and bridges in the future. 

At one point Saturday, Rep. Tim Kelly, chair of the House Transportation Finance Committee, offered up a plan that included funding for roads and bridges and transit, but he noted that he didn’t have the backing of House Republicans for the proposal. Kelly, R-Red Wing, is not returning to the Legislature next year.  

But late Saturday, negotiations moved away from the transportation debate to focus on finishing the budget on time.

Body cams, drug reform and presidential primaries

As top leaders trudged along on major budget issues, rank-and-file lawmakers passed the time by pushing forward policy provisions they’ve been working on all session. 

On Friday night, the House unanimously passed a proposal to dramatically overhaul the way the state sentences drug offenders, a hard-fought compromise struck between county attorneys, public defenders and law enforcement. The deal, which would lower sentences for some low-level offenders while increasing penalties for drug dealers, already passed the Senate and is on its way to the governor’s office.

Another long-sought compromise to regulate the data collected by police body cameras also got back on track in the session’s final days, after stalling earlier in the year. The deal classifies most body camera video as private, unless an incident results in substantial bodily harm. Dayton opposed including language in state law that allowed law enforcement to review body camera footage before doing an interview about an incident, and it was removed from the bill in order to gain his signature. 

W. C. Jordan, Jr.
Office of the Governor
W. C. Jordan, Jr.

Even still, civil rights groups were opposed to the final compromise, saying it was mostly written by and for law enforcement.

“Unfortunately, after testifying and responding to questions regarding bills proposed by Rep. [Tony] Cornish and Sen. [Ron] Latz, we believe that our concerns have fallen on deaf ears in the Legislature,” said W. C. Jordan, Jr., President MN/Dakotas Area Conference of the NAACP. 

Dayton will also have the chance to sign a bill changing Minnesota from a caucus state in presidential years to a primary system, after the Senate approved the measure Saturday on a 46-11 vote. Minnesotans crowded into caucus locations across the state on March 1 to cast a vote for their preferred presidential candidate but were greeted with long lines. 

The proposal sets up an open primary system, which gives voters the option to choose which party they want to cast their preference ballot with on primary day, but they must agree that they are in “general agreement” with the principles of the party. That information, along with name, address, and birthdate of the voter, will be collected by county clerks as part of public voter roll.  

After initial reluctance, both chairs of the DFL Party and Republican Party of Minnesota got on board with the plan, which would allow parties to still hold caucuses in non-presidential years.

“I appreciate legislators were willing to work together to pass a bill to ensure the broadest participation possible without disenfranchising people,” DFL Party Chairman Ken Martin said in a statement. “The presidential primary will make the process inviting, accessible, fair, and open to all eligible voters in Minnesota.” 

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Comments (3)

  1. Submitted by Cathy Erickson on 05/22/2016 - 01:19 pm.

    Thank You!!

    Thanks so much for reporting in on a Sunday! Should be an interesting day ahead.

  2. Submitted by Robert Gauthier on 05/22/2016 - 05:10 pm.

    How about…

    Request from Catholic Bishops on Friday night to include parochial schools in the school voucher program? Nothing like sucking up to the public trough for religious education. Surprised that didn’t get covered,with all the questions of separation of church and state and illegal lobbying by nonprofits for state funds. Another late night Republican proposal. Nothing like using our tax dollars to buy an election.

  3. Submitted by Robert Gauthier on 05/22/2016 - 05:13 pm.


    The reason everything goes to the last minute is the Republicans do not hold hearings, post meetings nor discuss many of the issues they try to bring up at the last minute. One might want to take a look at what they’re trying to do to MNSure, basically gutting it without public hearing. Nothing like back door back room politics out of the eye of the public. They can then claim everything is vetoed when the governor tries to protect the citizens of the state. In the public doesn’t understand the nuances nor do they really care as they blindly boat whatever the latest talkshow host tells them to do. Government by the gullible and the devious.

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