Minnesota special session wraps up $46 billion budget

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ST. PAUL—Gov. Mark Dayton often says that Minnesota voters sent a politically divided government to St. Paul, creating the basis for conflict.

The 2017 legislative session proved him right, but the past five months also showed that opposites can compromise. The major compromise between Democrat Dayton and the Republican-controlled Legislature came early Friday, May 26, when they came together on a $46 billion, two-year state budget.

Dayton is expected to discuss the Legislature's budget at some point on Friday, perhaps saying if he will sign all of the bills.

Senate Minority Leader Tom Bakk, D-Cook, said he will strongly recommend the governor veto a $650 million bill that cuts taxes and provides funds to local governments. He said it reduces taxes too much.

But Senate Majority Leader Paul Gazelka, R-Nisswa, said the tax bill needs to become law. "We said from the beginning we want significant tax relief."

The session received generally favorable grades from lawmakers of both political parties, although some Democrats were critical of the outcome.

Despite late political drama, involving whether a suburban trail would be paved or dirt, that delayed final votes, the 2017 Legislature produced more results than many in which Republicans and Democrats share power.

Besides the budget, lawmakers this year passed a range of legislation, including allowing liquor stores to be open Sundays (with local government approval), aided people forced to buy expensive individual health insurance policies, approved matching state driver's licenses with federal regulations so Minnesotans can use them to fly on airlines and approved a $987 million public works construction bill.

Their main job, however, was to pass a state budget.

Spending $46 billion of state taxpayers' money (up from $42 million in the current budget) never was a debate, but how it was spent was the session's main division.

House Republicans began the year wanting to cut taxes about the same amount as the state budget surplus, $1.65 billion. That eventually dropped to $650 million as Dayton demanded more spending for programs throughout state government.

Dayton wanted to raise gasoline taxes and vehicle registration fees to generate transportation money. Republicans rejected that, insisting, instead, on taking $300 million that otherwise could have been spent on other state programs.

The governor and GOP leaders had deep divisions in most areas of the budget.

"We're really happy," House Speaker Kurt Daudt, R-Crown, said just after the House adjourned at 2:42 a.m. Friday. "We accomplished what we set out to accomplish."

Senate Majority Leader Paul Gazelka, R-Nisswa, said the same after his chamber adjourned at 3:23 a.m. "So many things, it seemed like the dam broke and we got a lot done."

But House Minority Leader Melissa Hortman, D-Brooklyn Park, called the session "real disappointing (because it) left Minnesota working families behind."

Bills funding five of 10 areas of the state budget passed by the midnight Monday constitutional deadline to adjourn the regular session, but Dayton called legislators right back to work for what was supposed to be a one-day special session. Lawmakers missed their deadline as the special session ran more than three days. Most of the rest of the budget bills passed Wednesday and Thursday, but two remained on Friday.

Work late Thursday and early Friday was delayed, threatening the entire state budget, over a dispute about whether a Bloomington biking and hiking trail should be paved or dirt.

Once that was smoothed over (it will be paved), the problem became the 672-page health and human services bill. Dayton wanted some things changed, but they could cost needed Republican votes, forcing lengthy private negotiations even after senators began debating the bill. That shut down the Senate for hours.

The top HHS Democrat, Sen.Tony Lourey of Kerrick, strongly argued to reject the legislation "and try to make this a little bit better bill."

Sen. Jim Abeler, R-Anoka, said the legislation has something for everyone. "This bill is truly a collage."

Other Republicans talked of the need to save money on HHS programs because costs are climbing out of control.

But Rep. Jennifer Schultz, D-Duluth, said the GOP-written bill actually will cost Minnesotans more.

She said the legislation contains $1.2 billion in one-time money, which will not be available in future years. "What happens in 2020 and 2021? It all falls down."

Once the HHS bill passed the Senate (35-26) and House (74-56), the final major measure was a bonding bill to fund $987 million of construction projects on state and local facilities. It passed easily in both chambers, the last major action before adjournment.

Sen. Kent Eken, D-Twin Valley, said his rural district will benefit from some of the big measures passed this year, including tax and bonding legislation that were "kind of following up on last year" when neither became law.

"We've been able to make some progress," Eken said.

Tax improvements of special interest to rural areas, he said, include property tax breaks for farmland, the first $100,000 value of businesses and some cities in extreme western Minnesota.