Minnesota Legislature:  2008 Week in Review

February 15, 2008

 

 

Legislative Session Will Focus on Creating and Retaining Jobs

DFL leaders in the Senate and House unveiled a legislative agenda for the 2008 session designed to make Minnesota strong, united, and prosperous again.

The 2008 session will focus on creating and retaining jobs. The DFL Senate set forward an agenda for an aggressive and targeted jobs bill to spur economic growth, and a transportation bill to make our roads and bridges safe.

In the last several months, Minnesota has lost 23,000 jobs, prompting Minnesota’s chief economist, Tom Stinson, to declare the state is in a recession.  Additionally, a recent report on the signature economic development program championed by the Governor, has sloppy oversight, and there is little evidence of jobs created by the program.  The legislative leaders said they support innovation and targeted investment to spur job growth.

This session provides an opportunity to give Minnesota’s struggling economy a boost. The DFL Senate is committed to working to help create ‘green collar’ jobs, rebuild our crumbling transportation infrastructure to ensure goods and services can get around the state easily, and encourage innovation in areas like biotechnology.  The Senate will also focus on ways to reform our health care system to make it more affordable.

Many other issues will be before the Legislature this year, including efforts to curb greenhouse gases, preserve the state’s outdoors, and make the state energy-independent.

Senate and House leaders are committed to continuing the efforts to bridge the partisan divide and move the state in a positive direction. One of the first bills the Senate and House will be passing is a bipartisan effort to help preserve our natural heritage for future generations.  It’s time to go in, get our work done, and make Minnesota a better state.

 

 

Road and Bridge Safety Highlighted as Session Priority

Senate and House Transportation Committee members held a press conference on Feb. 12, the first day of the 2008 Legislative Session, to highlight the “Safe Roads and Bridges Improvement Act” omnibus transportation funding package.

Legislators noted that providing an economic stimulus in the wake of the state’s recession, along with improving the safety of the state’s roads and bridges, were a legislative priority, thus this legislation was introduced and heard in both the House and Senate Transportation Funding divisions on the first day of session.  Legislators are spearheading an aggressive timeline with this legislation, and plan to have a bill on the Governor’s desk by the end of next week.

This package will provide $8.4 billion in new transportation resources over the next 10 years.  The bill addresses the safety needs facing all areas of Minnesota’s transportation infrastructure, from local roads to state highways to transit systems in Greater Minnesota and the metropolitan area.  Additionally, according to a Federal Highway Administration (FHWA) study on transportation investments, a bill of this size would create an average of 33,000 jobs a year for the next five years.

This legislation is very similar to the comprehensive transportation package that passed with bipartisan support in 2007.  However, notable efforts to compromise with the Governor and Republican colleagues are incorporated.  This legislation includes:

•  A five-cent gas tax increase, indexed for inflation.

•  Counties in the metropolitan area, by board resolution, may form a joint powers board to levy a half-cent sales tax for transportation funding.  Sales tax revenues would be allocated 50% to transit, 25% to local roads, and 25% to a flexible fund.  The sales tax is reduced to a quarter-cent after 20 years.

•  Counties in Greater Minnesota, upon voter approval, may levy a half-cent sales tax for transportation projects.

•  Vehicle registration tax caps are removed.  The vehicle depreciation schedule is accelerated to reflect the true value of the vehicle, resulting in a savings to vehicle owners.

•  The lowest tax bracket will receive a $25 income tax credit to offset the gas tax increase.

•  Revenues from the leased vehicle sales tax will be dedicated to transportation funding.  After paying for the income tax offset, remaining revenues would be allocated 50% to Greater Minnesota transit, 25% to metropolitan area transit, and 25% to local roads.

•  A $2.2 billion bonding program is authorized.  The bonding program is front-loaded, providing $500 million in each of the first two years.  Of this amount, $300 million will be dedicated to replacing fracture critical trunk highway bridges, based on a tiered system which identifies bridge replacement needs.

•  A surcharge on the gas tax, capped at 2.5 cents, is created to assist in paying the debt service on the bonds.  This surcharge reduced the debt burden on future generations by providing real dollars to pay the interest bonds.

•  Components of the Governor’s 2008 bonding proposals are included.  This bill provides $50 million in bonds for local bridge replacement, $10 million in bonds for local roads, and $55 million for the state match of the federal Urban Partnership Agreement grant.

 

 

Safe Roads and Bridges Investment Clears First Committee

On Feb. 14, the Transportation Budget and Policy Division passed the Safe Roads and Bridges Improvement Act, demonstrating the Senate’s commitment to quickly and decisively act to create jobs and improve the safety of the state’s infrastructure.  The next stop for this legislation is the Finance Committee, where it will be heard on Feb. 18.  It is the intention of both the House and Senate to have this bill passed out of both bodies and before the Governor by the end of next week.

 

 

Legislative Session Will Focus on Growing Jobs

Earlier this week, legislators traveled across the state to reassert their commitment to focusing this session’s work on growing jobs in Minnesota.

Minnesota’s economy -- which has experienced sluggish growth over the past several years -- ground to a halt in the second half of 2007.  From July to December, the state lost over 23,000 jobs, compelling State Economist Tom Stinson to acknowledge the state’s economy has officially entered a recession.

In response, legislators have assembled an economic stimulus package focused on spurring job growth, enticing private investment, and laying the groundwork for sustained economic growth.  A key piece of this package will be the passage of several provisions vetoed by Governor Pawlenty in 2007.  This includes an omnibus tax bill that would spur millions of dollars of private investment in existing businesses and new bioscience companies, as well as a broad-based bonding package and a comprehensive transportation financing bill.

Passage of a comprehensive bonding bill and transportation finance package would not only grow jobs in the ailing construction sector, but would also make much-needed improvements to the state’s roads and bridges, public infrastructure, and higher education institutions.

 

Quote: Through strategic investments, we can immediately generate thousands of jobs in our region and across Minnesota, and lay the foundation for sustainable, long-term economic growth.  As unemployment continues to increase and job-growth in the state remains stagnant, it is imperative that the Legislature take an active role in moving the state out of this recession.

 

 

Presidential Primary Discussion

Members of the Senate State and Local Government Operations and Oversight Committee received testimony from the major political parties and concerned citizens regarding the possible implementation of a presidential primary.  Minnesota has not conducted a presidential primary since 1992, and with the tremendous turnout at the state’s precinct caucuses on Feb. 5, there is renewed interest in the possibility of reinstating the presidential primary.

Many of the individuals who testified before the committee related their experiences of being overwhelmed by the turnout, which was estimated at 230,000 on the Democratic side, and over 50,000 attending the Republican caucuses.  Some individuals were unable to cast their straw poll ballot for president because of long lines at the caucus locations, while others, unable to find parking or frustrated by the traffic volume, turned around and went home.

The committee took no action on the bill. Concerns over implementation included the cost factor, whether the primary should be open or closed, and whether it should be binding or nonbinding.  Also raised was the concern of whether the precinct caucuses should be continued should a primary be implemented.

 

 

Economic Development Budget Division Hears Bonding Requests

The Senate Economic Development Budget Division held two hearings this week to examine bonding requests aimed at improving the economies of communities across the state.

Several small cities brought forward requests for state assistance with costly infrastructure needs, including the construction of wastewater treatment plants and sanitary sewer overflow facilities.  The committee heard from many local officials who told lawmakers that their cities could not continue to bring in new residents or businesses without first addressing these issues.

Other requests came from local governments seeking funding for regional attractions, such as convention centers, zoos, and museums.

The division is using these hearings to develop a list of recommended projects that will be forwarded to the Senate’s Capital Investment Committee.

 

Outdoors, Clean Water and Arts Amendment Passes Legislature, Goes to Voters

Today the Minnesota Legislature passed historic legislation that gives Minnesotans the choice to invest in the things they love most about their state:  lakes and rivers, outdoor resources and cultural amenities.

The legislation proposes an amendment to Minnesota’s Constitution that will dedicate an additional 3/8ths of 1% of state sales tax revenue for investment in the unique qualities that characterize Minnesota’s way of life.

If voters approve, about $276 million a year will be invested in the cleanup of polluted lakes and rivers, the protection and preservation of outdoor recreation and resources, and the enhancement of arts and cultural programs. The breakdown of the investments are:

•   33% to the Outdoor Heritage Fund to restore, protect, and enhance wetlands, prairies, forests, and habitat for fish, game and wildlife ($91.1 million a year).

•   33% to the Clean Water Fund to protect, enhance, and restore water quality in lakes, rivers, streams, and to protect groundwater from degradation ($91.1 million a year). At least 5% of the Clean Water Fund must be spent only to protect drinking water sources ($4.5 million year).

 •  14.25% to the Parks and Trails Fund to support parks and trails of regional or statewide significance ($39.3 million a year).

•   19.75% to the Arts and Cultural Heritage Fund for arts, arts education, arts access, and to preserve Minnesota’s history and cultural heritage ($54.5 million year). 

The bill was driven by people who are passionate about the heritage of this state. Supporters of the legislation saw something important slipping away and worked hard to preserve and protect some of what is best about Minnesota. The House and Senate made a promise to Minnesotans last spring that this would be a priority for us this session.

Environmental and arts priorities are continually neglected when the state’s budget is set, in favor of more pressing budget needs such as education and health care.  As a result, state financing of environment and natural resources programs recently hit its lowest point in 30 years. Minnesota’s cultural resources and arts programs have also suffered significantly due to state budget difficulties. 

Noting increasing pressure on Minnesota’s outdoor and recreation assets due to development and expanding population, supporters stressed the urgency of investing now to preserve Minnesota’s way of life.   For example:

·    40% of Minnesota’s tested lakes and rivers are found to be polluted and are not safe for fishing and swimming.

·    One in four wildlife species, and one in five plant species, are endangered or threatened.  Almost half of Minnesota’s original wetlands no longer exist.

·    Access to woods, fields, lakes and streams is increasingly threatened by development.

Voter approval of the constitutional amendment would ensure that the commitment to these priorities will exist for the next 25 years.  If the amendment passes, the revenue dedication goes into effect July 1, 2009, and ends in 2034.

 

Minnesota Health Plan Unveiled

A press conference was held Monday to announce the Mental Health Plan. The Minnesota Health Plan, also commonly known as the “Single Payer Plan,” aims to overhaul our current health system.  It seeks to eliminate the myriad of health care insurance companies in Minnesota and replace them with a single entity that handles payment of all health-related services. Supporters say this plan is the only one that can save money and cover all Minnesotans with comprehensive health, mental health, and dental care. The plan would be paid for by premiums assessed to employers and individuals, and would replace co-pays, deductibles and other health care costs.  A physician at the hearing said that while America has the best health care in the world, we do not have the best health care system in the world, and a plan like the Mental Health Plan is needed and supported by physicians.

 

Blood Donation Bill Heads to the Floor

A bill that would allow 16-year-olds to donate blood with parental permission was heard this week.  What makes this bill unique is that it was proposed by 15-year-old Joe Gibson. Gibson, a Blooming Prairie high school student, said he was frustrated when turned away during a blood drive being held at his school.  He said he saw a 60-year-old woman go into donate and thought, “I can do that.  I’m young, healthy and fit.”  Gibson, who had recently lost his grandfather to leukemia, launched a campaign that involved research, a school petition, meeting with stakeholders and asking legislators to sponsor the legislation.  Currently, 15 other states have passed similar bills, including Wisconsin.  The bill originally extended to 15-year-olds, but was met by objection from pediatricians.  Testifying at the hearing held Wednesday, Feb. 13 in support of the bill was both the Red Cross and Memorial Blood Centers who said that there is always a need for more blood donations.  They hope the passage of this bill will help to meet that need.  The bill was passed unanimously out of the Health, Housing and Family Security Committee and will move to the Senate floor. 

 

Legislative Auditor Releases Report

The Legislative Auditor gave an overview of their report on the Financial Management of Health Care Programs.  The evaluation was done to measure how well the state has managed the cost of its public health care programs: Medical Assistance, MinnesotaCare and General Assistance Medical Care.  The findings of the report included:

•   That while not necessarily cheaper, managed care does seem to be more effective in treating low-income persons than the fee-for-service system.

•   DHS needs to be more rigorous in its oversight of health care plan spending on enrollees.

•   More vigilance needs to be paid to the amount of administrative spending by health plans.

•   Minnesota spends more on its enrollees on Medical Assistance because of the comprehensive benefits that it pays for and the larger percentage of people qualifying for long-term care and disability services. 

•   County-based purchasing has not been shown to demonstrate being less expensive or more effective than those services offered by other health plans.

•   Reimbursement rates have not kept up in recent years, going from about 60% to 30% of the cost for providers treating public health plan enrollees.

 

Lawmakers to Unveil “Green Solutions Act” and an Action Plan to Reduce Greenhouse Gas Emissions

Minnesota lawmakers from the House and Senate unveiled Part One of their Green Solutions package today – a comprehensive action plan to reduce greenhouse gas emissions 80% by 2050. This broad, bicameral alliance of legislators is calling the Green Solutions package “a real plan for real action” that will create and stimulate a Green Economy, put Minnesota on the cutting edge of energy-efficiency efforts nationwide, and bring tens of thousands of good-paying, reliable Green Jobs right here to our state.

 

The Green Solutions Act of 2008

The Green Solutions Act of 2008 outlines a framework for the Midwestern Greenhouse Gas Reduction Program, a cap and trade program which will allow polluters to purchase credits equal to their annual greenhouse gas emissions.  Minnesota joined the program in 2007, along with Wisconsin, Illinois, Iowa, Michigan, Kansas, and the Canadian Province of Manitoba. 

The cap and trade system would cover at least the electrical sector, large industrial facilities, transportation fuels, natural gas sold to heat buildings, landfills, and other sectors.

The Green Solutions Act requires the Department of Commerce to file a report with the Legislature by December 1, 2008.  This report will explain if the Midwestern Greenhouse Gas Reduction Program has developed rules which will fulfill the Act’s framework, or provide an outline of Minnesota’s plans to join another regional or statewide cap and trade system that will.

The revenue raised by the cap and trade system would be placed in a Climate Trust Fund.  These funds would be used to further reduce emissions and minimize economic impacts on workers, businesses, and low-income families by funding:

•   Financial assistance to help consumers and businesses invest in energy efficiency and renewable-energy technology;

•   Direct payments or refunds to Minnesotans especially affected by the program;

•   Investments in public transit;

•   Investments in worker training and retention programs; and

•   Studies in terrestrial carbon sequestration, including assisting Minnesotans with the cost of implementing carbon sequestration.

Cap and trade systems are proven market-based systems which encourage polluters to adopt environmentally-friendly policies.  A cap and trade system on sulfur dioxide done by the federal government in the ‘90s has been called “the greatest green success story of the past decade” (Economist, 7/6/2002).  The program was able to greatly reduce sulfur emissions and acid rain, and it was able to reach its goals ahead of schedule and for less money than expected.

 

The Minnesota Clean Car Act

The Minnesota Clean Car Act orders Minnesota to adopt the California Clean Car Standards.  These standards, which passed the California Legislature in 2002 and were formally adopted in 2004, require automobile manufacturers to reduce greenhouse gas emissions by 30% in all new cars by 2016. 

Automobile manufacturers will be able to reach the California Clean Car Standards by making improvements to a car’s engine, tires, transmission, and air-conditioning systems.  These technologies are already available and in use by manufacturers.  In fact, Chevrolet is releasing a new Tahoe Hybrid that will be compliant with 2016 standards. Other vehicles such as the Saturn Outlook, Chevrolet Equinox, and 2008 Sierra 1500, will also meet 2016 standards when fueled by E85.

Although auto manufacturers argue that adoption of the Minnesota Clean Car Act would increase the sticker price of a new car, consumers of standard-compliant vehicles would save a significant amount of money because these more-efficient vehicles will use less fuel. According to a study conducted by the Union of Concerned Scientists, the average vehicle owner under these new standards would save $1,700 per year if gasoline costs only $2 per gallon. With gas prices quickly escalating, those savings could likely double.

Attorney General Lori Swanson recently joined a coalition of 17 other states that have filed a lawsuit against the United States Environmental Protection Agency for denying California’s waiver to the Clean Air Act.  This waiver was needed in order to allow California and other states to implement emission standards that are stronger than the federal government’s.  Attorney General Swanson stated that she has filed the petition “in order to preserve the state’s ability to adopt the standards.”