Another fine mess

MinnPost photo by Briana Bierschbach
Rep. Greg Davids: “We’ve got the writing instruments needed for the governor to sign this document, right here.”

Always a fan of theatrics, Greg Davids brought props to a Monday press conference designed to urge Gov. Mark Dayton to sign a package of tax cuts passed by legislators. 

Davids, chair of the House Republican Tax Committee, authored that bill, which he affectionately dubbed the “Don’t Stop Believin’” tax bill, way back in 2015. He hadn’t stopped believing as of Monday morning, when he hauled a copy of the 277-page bill to the press conference along with enough pens for Dayton to sign each letter of his name, including his middle initial. 

“We’ve got the writing instruments needed for the governor to sign this document, right here,” Davids said, pointing to the bill. 

But his efforts meant very little at midnight, when Dayton chose not to sign the $260 million bill, killing the measure through a pocket veto. The bill included tax deductions for veterans, college students with debt, families and key tax cuts for a Major League Soccer stadium in St. Paul. 

The media blitz was the culmination of a week of back-and-forth letters, meetings and dueling media appearances in the wake of a messy 10-week session that saw a divided Legislature negotiate how to spend a $900 million budget surplus right up until the end, passing the tax cut bill and a $182 million supplemental budget bill just a few hours before their deadline.

But a transportation deal and package of bonding projects weren’t so lucky, blowing up in the last 15 minutes of session over a disagreement about whether mass transit funding should be included in the package.

Since then, Dayton’s been mulling the possibility of calling a special session to deal with those two issues plus now the tax bill, but the odds were looking slim as of Monday.

“Who knows what happens if he doesn’t sign the bill, but I will say that it gets more difficult to get to an agreement,” Republican House Speaker Kurt Daudt said Monday. “Because the governor will have gone back on his word and that to me is something difficult to repair in St. Paul.”

One word dooms the tax bill

That promise from the governor, according to Daudt, was to deal with the tax cut bill separately from other issues being considered for a special session. One day after lawmakers adjourned, Dayton said he would review the budget and tax bill within days and decide based on their merits whether to sign or veto them. 

Dayton signed the budget bill, but while he was reviewing the tax bill, his staff and commissioners discovered an error — an “or” was written in place of an “and” in one section, expanding the establishments eligible for a tax break from just bingo halls to all locations that sell paper pull-tabs. The mistake has the potential to cost the state $101 million over the next three years.

House Speaker Kurt Daudt
MinnPost photo by Briana Bierschbach
House Speaker Kurt Daudt

Lawmakers said they could clarify the language in the bill without a special session, but the governor’s administration said it would require a full vote from the Legislature, or else the law could wind up in court. 

For his part, Dayton said he would have signed the tax bill without the error. But he also laid out a handful of conditions he’d like met if he’s to call lawmakers back for a one-day special session. That includes $182 million in additional bonding projects, more than $75 million in new spending over the next year and funding for transit projects in the metro area. 

“I was not going to sign a tax bill with an error it in,” Dayton said Tuesday morning. “That would be foolish.” 

Daudt and other Republicans accused Dayton of playing politics — using the tax bill to gain leverage on other issues. “There’s no way to look at this other the governor is holding the tax bill hostage to get more spending,” Daudt said. “Your word has to mean something, and if it doesn’t you are not going to have an easy time getting things done in St. Paul.”

Special session chances: slim

The one-word error in the tax bill is only the latest discord in St. Paul, but it’s not the only thing that caused the 2016 session to unravel.

The biggest points of friction all year were actually the package of public works projects rolled out every other year — known around the Capitol as the bonding bill — and a long-term funding plan for transportation.

Lawmakers couldn’t find agreement on a way to dedicate funding for transportation over the next decade, but they did agree to a $1 billion bonding bill — and to spend about $275 million in one-time cash on transportation projects. In the final minutes of session, though, Democrats in the Senate learned that proposal didn’t include funding for mass transit, so they added it to the bill and sent it back to the House. With time running short, House members decided to adjourn instead of taking up the bill and sending it to the governor.

Gov. Mark Dayton
MinnPost photo by Briana Bierschbach
Gov. Mark Dayton

Without a bonding, transportation or tax cut bill, 2016 could easily be labeled the do-nothing session many feared. It also means legislators will have little to show voters when they hit the campaign trail this fall, when all 201 House and Senate seats are on the ballot.

Dayton and the leaders of the Legislature’s various caucuses all say they are still open to negotiating a special session, and Daudt has said he’s not closing the door on Dayton’s list of conditions. “I don’t like a lot of them, I think that’s not a mystery, but we are going to talk about those things if they are important to him,” he said. 

But the bigger the agenda gets, the harder it is to reach a compromise. Last June, a one-day special session to deal with a handful of budget bills nearly imploded after legislators started amending bills, breaking an agreement that had been negotiated among leaders. This year, Dayton again wants an agreement from all leaders on the parameters of the session before he calls legislators back to St. Paul. He’s worried re-opening the tax bill would set off a “free-for-all” for new tax cuts. Dayton would prefer if legislators simply fixed the error, added an exemption for the state’s highschool league that’s about to expire and sent the tax bill back to him. 

House DFL Minority Leader Paul Thissen lamented that deals on taxes, transportation and bonding could have all passed easily if lawmakers had gotten their work done earlier. Many lawmakers have stepped up calls for transparency and changes to the legislative process after top leaders pushed deal-making off until the very end for the second year in a row.

“If there’s one thing I learned from the four generations of Minnesotans that came before me, it’s that we’re expected to get our work done, to get our work done right, and to take responsibility when that doesn’t happen,” Thissen said in a statement. “There are many good provisions in the tax bill for ordinary Minnesotans, but unfortunately, due to the rush job and chaos at the end of session, there is a $100 million error in the bill.” 

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Comments (16)

  1. Submitted by Greg Kapphahn on 06/07/2016 - 09:26 am.

    From What I Understand

    What the Senate Democrats amended into the the bonding bill was NOT state spending to support SW light rail,…

    it was permission for the metro area communities that would be impacted by light rail to tax THEMSELVES to pay for SW light rail.

    It’s amazing, isn’t it, that our Republican friends, especially those from rural areas,…

    who so deeply resent the people in the metro area,…

    (which is what they largely regard the DFL to be made up of),…

    telling THEM what to do,…

    but regard themselves as so superior in intelligence and wisdom,…

    as to feel completely justified in telling the citizens of the metro area what to do,…

    with their OWN tax dollars and taxing authority.

    I’d be tempted to use the wordy hypocrisy, here,…

    but we’ve long since gone past that,…

    to the point where our “conservative” friends relish their own hypocrisy,…

    and celebrate it.

    • Submitted by Henk Tobias on 06/07/2016 - 01:52 pm.

      Excellent points

      I wonder why our illustrious media has pointed out the real intent of the Democrat’s amendment? Brianna?

    • Submitted by lee wick on 06/07/2016 - 04:28 pm.

      NO Light Rail

      Daudt made it clear during the process the House would not entertain anything light rail in the bill. It did, regardless of the intent.

  2. Submitted by Jim Halonen on 06/07/2016 - 09:48 am.

    It would be helpful

    The reader would benefit if this article mentioned the rollcall vote on the omnibus tax bill in the House was 123-10. What the governor vetoed was very bipartisian, almost unanimous.

    • Submitted by Jason Swenson on 06/07/2016 - 10:07 am.

      Bipartisanship

      Which just points out that had the legislature actually passed the bill in a timely manner (before the last three days of the session), the Governor would have had significantly less power than he was given in the mad rush to conclude things. The legislature could have overridden a veto had they wanted to. Instead, they gave the Governor the power to make demands.

    • Submitted by Henk Tobias on 06/07/2016 - 01:14 pm.

      Yes

      They passed a bill, one they had been working on for over a year, in a timely manner with a majority vote and a HUGE mistake. One word costing over 100 million dollars. If they can’t get it right with so much time and thought, imagine the crap that gets through when they’re rushed. Thank god Dayton is paying attention because no one else seems to be.

    • Submitted by John Ellenbecker on 06/07/2016 - 02:36 pm.

      Bipartisan – but with a $101 million error

      The tax bill may well have been passed in a bipartisan manner, but that doesn’t change the fact that it had a significant error in it.

  3. Submitted by Joel Stegner on 06/07/2016 - 11:26 am.

    Special session

    Republicans, quit whining. If you hadn’t been giving speeches for most of the session and actually been working on what you are paid to do, everything would be signed at this point. Rural MN would have its roads and bridges, the metro its transit and all those tax cuts would be in place. This is the second year running you didn’t get your job done, but instead you are trying to use unfinished business that is your responsibility for political advantage. If Daudt and the rest of your leadership has any sense, they will take a deep breath, do some real horse trading (giving in at least on transit), do the special session and use that rather than inaction to make your pitch to the people. Who knows, you may enjoy legislating more than whining and pontificating?

  4. Submitted by Nathaniel Finch on 06/07/2016 - 01:44 pm.

    Theatrics

    Greg Davids is “always a fan of theatrics.” Too bad he’s not in the theater. He would be a lot more entertaining. As it is, his performance in the legislature leaves a lot to be desired.

  5. Submitted by Rachel Kahler on 06/07/2016 - 02:30 pm.

    Holy moley guys

    I’ve been listening about this clown car convention for the past several days. What a stinking mess. And what just chaps my hide is the Republicans’ response to the tune of “It’s just One Hundred MILLION Dollars. Just sign it!” Fiscal responsibility my big behind!

  6. Submitted by Tom Anderson on 06/07/2016 - 11:02 pm.

    Costing the State $100 million dollars

    The folks making this assessment aren’t the same ones who overstated MinnSure enrollment and cost are they? Or the ones who said electronic pulltabs would pay for the Vikings stadium?

    The tax cut for many Minnesotans would have resulted in reducing the amount of taxes collected by $100 million dollars and would have reduced the budget surplus from $900 million dollars to $800 million dollars, which is less than the Governor wanted to spend when the session started. The horror!

    Repeat. The error would not have resulted in $100 million of new spending, it would have resulted in $100 million less in collected taxes.

    • Submitted by Jim Million on 06/08/2016 - 10:59 am.

      Thanks, Tom

      Facts do matter, so thanks for looking at this upside right. Please remember, however, you write in a realm that generally defines “tax cut” as a smaller increase.

      • Submitted by Tom Anderson on 06/08/2016 - 09:34 pm.

        Actually

        I forgot that the $100 million figure is “over three years” so it actually gouges the surplus even less than I stated before.

        • Submitted by Rachel Kahler on 06/10/2016 - 10:27 am.

          Drop in the bucket

          But the Republicans are happy to delete drops in the bucket. That they ignore this one is hypocritical, to put it politely. But, if no one cares about $100 million (over 3 years or otherwise), I’d be happy if they simply routed it to my bank account. After all, what’s $100 million over 3 years? Also, I’m pretty sure that revenue in vs revenue out is a pretty important thing. If they’re planning on spending that lost $100 million, it would seem a good idea to actually have it in the bank.

  7. Submitted by Gary DeVaan on 06/10/2016 - 09:43 am.

    Wasting our tax dollars

    By not funding SWLRT, the legislature wasted the millions of dollars that has already been spent on this project, they also turned away a billion federal dollars that we paid and would like to get back.

    So this is financial responsibility?

    They might as well have rolled a pallet of hundred dollar bills into the parking lot and lit it on fire.

  8. Submitted by Paul Udstrand on 06/12/2016 - 05:15 pm.

    I expect better from Minnpost..

    We don’t need a summary wrap-up that sanitizes toxic policy initiatives and spreads blame evenly. We need reliable analysis that identifies the problem.

    The leaders of the House are republicans and the fact that they didn’t get the States Business done isn’t a “joint” failure of both parties or everyone involved.

    The republican obsession with tax cuts and their own self mandated “budget neutral” principle was simply a foray into magical thinking that always collapses when magic fails to manifest itself.

    We’re still trying to resolve huge legacy of financial and service deficits left over from republican tax and service cuts during the Pawlenty years. We need at least $1.1 trillion in spending for transportation, and republicans offer $300 million because preventing ANY new revenue is more important than ANYTHING else. I don’t about anyone else but I seriously doubt the “one word” glitch was really a mistake. I suspect they slipped in in hoping no one would notice.

    As far as the special session is involved, according to my legislators republicans had already agreed to the stipulation that would have let Henn. Co. raise taxes to cover the SWLRT but they reneged on that agreement and pulled it out. When Senate democrats realized that the option had been pulled, they put it back in and sent it back to the house (all in the space of the last twenty five minutes of the session mind you). Republicans simply refused to look at it and adjourned.

    From the republican perspective I think they reckoned Dayton wouldn’t pocket veto a tax bill with a few goodies in it so they were home free… they got their tax cuts which is all they cared about.

    Fortunately Dayton had the courage use the pocket veto which leaves the republicans pretty much with zilch to show for months of alleged work. If the republicans won’t come back to re-pass their own tax bill, they would never have come back in good faith for anything anyways so a special session was never in the cards regardless.

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