Minn. Senate Still Debates Tax Bill, Deadline Looms

Updated: 05/20/2013 11:09 PM KSTP.com By: Cassie Hart

A few final debates echoed through the state Capitol Monday, as lawmakers haggled over tax increases and union organizing in a session that's already seen a big spike in spending on schools and a landmark law legalizing gay marriage.
A session that started in January ended in a rush toward the finish line: a midnight deadline to adjourn for the year.

Minimum Wage Debate

Members of a House-Senate conference committee on the minimum wage bill met briefly in the afternoon but reached no conclusion.

The Senate previously voted for a $1.60 increase in the state's $6.15 minimum wage while the House wants a larger, $3.35 increase.       

Daycare Union Bill

With time running out, the Minnesota House passed a bill that allows a union drive among home daycare providers and personal care attendants after about 10 hours of debate strung out over more than two days.
The final vote was 68-66. A handful of Democrats voted no along with all the House Republicans, who waged an intense floor fight against the daycare unionization drive. The issue drew demonstrators to the Capitol from both sides of the issue.
The Senate already passed the bill, so it's on its way to Democratic Gov. Mark Dayton who is likely to sign.        

Omnibus Tax Bill

Around 2 a.m. Monday, the House narrowly approved a $2.1 billion tax increase that falls primarily on smokers and the top 2 percent of income earners, vaulting the state's top income tax rate into the nation's top five. The Senate was expected to pass it later Monday.          

"There is no glee or joy in doing the difficult work of raising revenue," said Rep. Ann Lenczewski, D-Bloomington.          

She framed the vote as a responsible approach to erasing a $627 million deficit and fashioning a two-year budget that makes big new commitments to schools, colleges and other programs.          

In a six-hour debate, one Republican after another warned the new taxes would backfire and lead the wealthy to flee.          

"Money talks and money walks," said Rep. Peggy Scott, R-Andover.          

Upon Senate passage, the bill heads to the desk of Democratic Gov. Mark Dayton, who is on board.          

The taxes represent a key link to a new $38.3 billion state budget for the next two years. The only other outstanding portion was a bill to pay for core state agencies, such as the Revenue Department and Department of Veterans Affairs. Both chambers were primed to act on that.

More details about the tax bill are available here.         

Warehouse Tax

KSTP has been looking into another part of the budget that's buried in the sales tax proposal.

Governor Dayton expanded items subject to the 6.5 percent tax to include custom software, equipment repair and maintenance and warehouse storage. 

Critics of the tax worry businesses would move their inventories to other states like Wisconsin, Iowa or North Dakota who don't impose sales tax on warehouse services.

If the tax sticks, Minnesota would be the only state in the country to tax warehousing services.

Bill to Allow Alcohol Sales at the Capitol

The Legislature passed a bill Monday that includes a provision that directs the city of St. Paul to issue and on-sale wine and malt liquor license to the Capitol cafeteria. The bill now goes to Gov. Mark Dayton.
The Capitol's basement cafeteria is a German-style rathskeller cafe. It was restored to its original design in 2000. It even has a painted slogan on the ceiling, in German, that urges visitors to enjoy an adult beverage.
The boozy provision is part of a package that distributes sales tax money from the state's so-called Legacy amendment to parks and to arts and cultural programs.

Bill to Curb School Bullying       

Democrats reluctantly declared a bill aimed at curbing school bullying a casualty of the dwindling clock. Critical financing for the state Capitol's ongoing renovation was in limbo.

A sizable increase to the state's minimum wage remained in play, but barely according to top lawmakers.       

Sen. Scott Dibble, the Minneapolis Democrat pushing for the new bullying policy, complained that Republicans stonewalled his bill by pledging a lengthy debate.          

"This is a political agenda and kids lose out," he said.          

Senate Minority Leader David Hann and his fellow Republicans expressed concern it would burden schools with new state requirements and open them up to potential lawsuits.          

"Many people in the state frankly don't think it is needed," Hann said. A few dozen supporters of the bill rallied at the Capitol Monday morning, vowing to push it again in the 2014 session.     

Legislature Pay    

Harmony was more apparent in the Senate on other things. A 43-26 tally sent a proposed constitutional amendment to the 2016 ballot that asks voters if an independent council should set legislator pay; that decision now rests with lawmakers, who haven't touched salaries since 1999 for fear of a political backlash.    

Groups Losing Out After this Session

The Walker Art Center was hoping for $7 million for irrigation, planting and restoration work at the sculpture gardens in Minneapolis, and the Minnesota Zoo had requested more than $4 million. Click here to read more. 

Borrowing Measure for State Capitol Fix-Up

Extensive work on the 107-year-old state Capitol is getting the go-ahead from Minnesota lawmakers in a late financial rescue package.
A borrowing proposal that came together on the Legislature's final day includes $109 million for the next phase of a renovation to the deteriorating building. The money was needed this year to keep underway construction from halting. A new parking ramp will be authorized, but paid for with fees from users.
The package is the result of high-level negotiations involving majority Democrats and minority Republicans, testament to the supermajority it requires for passage. It cleared both chambers with votes to spare and is on to Gov. Mark Dayton.
Aside from the Capitol project is an $18.9 million award for a new Minneapolis Veterans Home building that will garner a big federal match.  There is also $20 million for flood mitigation projects.

Absentee Voting

The Legislature has sent Gov. Mark Dayton a bill that lets anyone vote by absentee ballot without being forced to provide an excuse.
The change is included in a larger election policy bill the House and Senate passed on Monday with wide bipartisan support.
Current state law requires voters to attest one of a handful of justifications in order to obtain an absentee ballot, although enforcement has been lax. The bill lifts those limits entirely and opens up the absentee option to anyone.
Democrats had pushed a wider expansion of early voting at the polls, but Republicans opposed those changes. Democratic Gov. Mark Dayton made it clear he would only support election-law changes that have support from members in both parties.

The Associated Press Contributed to this Report.