Tax reform might be dull, but legislative debate on it is lively

By T.W. Budig, ECM Capitol reporter

Tax reform might be dull, but legislative debate on it is lively
Tax reform might be dull, but legislative debate on it is lively

Senate and House Tax Committees continue to delve into Democratic Gov. Mark Dayton’s proposed budget, which sounds dull but actually provides lively debate.

“Is this going to be called the First Amendment Tax — tax free speech?” Rep. Greg Davids, R-Preston, needled Revenue Commissioner Myron Frans this week about the proposed sales tax expansion that would tax newspapers.

Davids, something of a quote machine, shot-off a memorable line concerning the sale tax expansion to veterinary services.

“Oh my gosh, we’re taxing sick puppies and sick kittens,” he said.

He rejected talk of the proposed budget as balanced — “a taxes gone wild budget,” he called it.

“And there’s nothing I can do about it,” Davids said.

“I’m hoping you can be a moderating factor,” he said to House Tax Committee Chairwoman Ann Lenczewski, DFL-Bloomington.

Rep. Pat Garofalo, R-Farmington, questioned revenue assumptions for expanding the sales to business services.

He warned the state is currently witnessing the folly of using mushy numbers in budgeting.

“The numbers we used to fund the (Vikings) stadium, it’s pretty clear it ain’t working,” he said, smiling.

Frans echoed Dayton’s sentiments on the proposed tax expansion, indicating that it’s sure to provoke howls.

Revenue Commissioner Myron Frans enjoys a laugh with the House Tax Committee. Frans insists the state’s current sales tax base is too narrow to be sustainable. (Photo by T.W. Budig)
Revenue Commissioner Myron Frans enjoys a laugh with the House Tax Committee. Frans insists the state’s current sales tax base is too narrow to be sustainable. (Photo by T.W. Budig)

“The fact of it is, the list (of items currently covered by the sales tax) isn’t sustainable,” said Frans.

Minnesota has one of the narrowest sales tax bases in the country, he said.

Rep. Paul Marquart, DFL-Dilworth, encouraged voters to look over examples of items that would be taxed under the governor’s sale tax proposal, and items on which the sale tax would be lowered.

Then figure out the impact, he urged.

Republican criticisms of Dayton’s proposed tax reforms were voiced in the Senate Tax Committee.

Sen. Julianne Ortman, R-Chanhassen, insisted Dayton was using the “tax reform” banner simply as a means of disguising tax increases.

“It’s being touted as tax reform,” she said.

“That’s something I consider a great deception,” Ortman said.


Sen. Charles Wiger, DFL-Maplewood, is planning to introduce a bill next week (Feb. 4) to ban moose hunting.

Wiger, noting the declining moose numbers — the population was estimated at about half, 4,230 animals in 2012, of what it was  just six years before — said continuing to hunt animals plainly under duress doesn’t make sense.

The Department of Natural Resources, which recently launched an ambitious research program aimed at better understanding the moose decline, insists hunting is not to blame.

“The decline in the northeast Minnesota moose population is exhibiting the same pattern of decline that we observed in the northwest,” Lou Cornicelli, DNR wildlife research manager, said in statement recently.

“We’re losing about 20 percent of adult moose annually and know from previous studies that predation and hunting are not the primary causes of adult moose mortality. The decline is particularly troubling because more often than not, we can’t determine the primary cause of death,” he said.


Minnesota Department of Transportation Commissioner Charlie Zelle detailed recommendations made by a transportation advisory finance committee to a joint hearing of House transportation committees.

“This is no secret. This is arithmetic,” Zelle said of the advisory committee’s conclusion that for the region to sport a world-class transportation system will require $50 billion in additional funding over the next 20 years.

Rep. Michael Beard, R-Shakopee, who served on the advisory finance committee, said terms like “world class” are “nebulous concepts” fraught with political meaning.

Everyone agrees the state should be building roads and bridges, he said.

Disputes arise when the question turns from helping people to move, to showing them how to move, said Beard.

Representatives from business groups, including the TwinWest Chamber of Commerce, testified to the importance of a robust transportation system.

Judy Johnson, TwinWest Chamber of Commerce government affairs director, spoke of Southwest Corridor light rail’s importance to economic growth in the western suburbs.

She mentioned United Health’s proposal to build four towers on a property in Eden Prairie adjacent the proposed light rail line.


Former state senator Rick Olseen of Harris is working as one of Democratic 8th Congressional District Congressman Rick Nolan’s field representatives.

“I’m very impressed,” Olseen said of Nolan,  recently sent back to Congress three decades after leaving the House.

When he was out pounding in his campaign signs last fall — Olseen ran for the Minnesota House and lost — he was also pounding in Nolan signs, Olseen said.

“They’re recycling us all,” he quipped of the number of former Democratic lawmakers now working for Nolan.

Al Doty
Al Doty

Former state representative Al Doty of Royalton has signed on full-time as a field representative for Nolan while former state representative Tom Rukavina of Virginia is the congressman’s part-time representative on the Iron Range.

Olseen’s office is located in the Chisago County Courthouse.


A chatty Democratic Gov. Mark Dayton talked about guns, his budget, and his back during a press conference on Friday (Feb. 1) at the State Capitol.

On the eve of what the Capitol Press Corps has dubbed “Gun Week” in the House, Dayton indicated that he would judge gun bills reaching his desk by the simple standard of whether “it’s really going to make a difference.”

As a U.S. Senator, and as governor, Dayton supports closing the perceived gun show background check loophole. Indeed, it’s not really a loophole, the governor said.

It’s a “huge gap.”

It doesn’t require great intellect by criminals wishing to avoid background checks to shop for guns at gun shows rather than face the rigors of buying at a gun shop, Dayton explained.

The House Public Safety Finance and Policy Committee is expected to hear a series of gun-related bills in committee the week of Feb. 4.

But House Speaker Paul Thissen, DFL-Minneapolis, said no committee votes would be taken.

(One outspoken critic of gun control, Rep. Tony Cornish, R-Vernon Center, pulled his bill late week that would have permitted teachers to carry guns in the classroom.)

Turning his attention to his proposed budget, Dayton again styled the proposal as hardly perfect.

“There’s plenty to dislike about it,” he said.

But the governor invited those critical of the budget to propose something better.

He’s been disappointed, Dayton explained, by the level of the debate on the budget so far.

Perhaps more thoughtful dialogue will emerge — “probably won’t,” he said.

To those critical of his effort, Dayton asked “What’s your alternative?”

DFL leaders say the members of their caucus sense the public is supportive of the general direction of Dayton’s budget.

Now they’re looking for details on his tax proposal.

On another matter, the reason he quickly left a recent press conference announcing Mayo Clinic’s plan to invest some $3 billion into its Rochester campus — the state’s largest private employer, Mayo, with 32,000 Minnesota employees, is looking for state infrastructure backing — was not to display of lack of support, said Dayton.

He had to keep a back therapy appointment, he said.

Dayton, who recently underwent back surgery at Mayo, said he’d had been on his feet a lot.

The governor is expected to deliver his State of the State Address before a joint session of the Legislature on Wednesday (Feb. 6) at 7 p.m.

Dayton, along with Human Services Commissioner Lucinda Jesson, on Friday announced a first-state-in-the-nation reform initiative that has six major health care providers in the state agreeing to test a new payment model the administration believes will provide better health care for 100,000 Minnesotans and save the state Medicaid program $90 million over the next three years.

“This is a dramatic change,” Jesson said of the reform, which focuses on improvements in quality of care at lower cost rather than on volume of care.

The idea is to provide financial incentives for those providers meeting agreed-on targets for cost and quality.

Savings will be shared between the state and providers.

In later years, the providers and state will share the risks for losses as well.

“It’s just a starting plan,” Jesson said.

Other health care providers have shown interest in the reform and could join in future years, she said.

The reform holds Medicaid financial promise to the providers, Jesson said, as the amount of money they recoup in treating medical assistance patients continues to get nipped.

Human Services is putting out a second request for proposals to health care providers to include more challenging health care populations under the reform initiative.

Jesson indicated the administration has not included expected cost-savings from the initiative into their proposed budget.

“I think we do need a track record of a year or two,” she said.

Jesson and Dayton are travelling to Washington on Tuesday (Feb. 5) to meet with U.S. Department of Health & Human Services Secretary Kathleen Sebelius to discuss health care.


Republican legislative leaders offered slightly different personal takes on same-sex marriage legislation possibly coming before the legislature this session.

Sen. Dave Thompson, R-Lakeville, explained that he didn’t quite follow the logic of assuming the state was ready to accept same-sex marriage based on the defeat of the marriage amendment.

“I think that’s a leap from the vote that was made,” Thompson said.

House Deputy Minority Leader Jenifer Loon, R-Eden Prairie, said she was still studying the same-sex marriage issue.

“I don’t have a position at the present,” she said.

But same-sex marriage, she said, is a still a “very divisive social issue” and one deserving more conversation.

She cautioned Democrats not to hurry the issue along.

Tim Budig can be reached at [email protected]