State Senator District 7
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1 State Senator District 7 YVONNE PRETTNER SOLON G-9 State Capitol Building Phone: Rev. Dr. Martin Luther King Jr. Blvd Fax: Saint Paul, Minnesota ww.senate.mn/senatorsolon Week in Review March 16 Senate Approves Major Property Tax Relief Package $376 million package includes increases in state aid, property tax refunds Minnesota State Senators followed up on a session priority today, approving a $376 million property tax relief package in the Senate Property Tax Division to be included in the Tax Omnibus Bill later this month. A recent non-partisan study projects statewide property taxes to increase $600 million in The Senate s bill offsets a majority of the expected increase with $376 million of property tax relief, including $76 million in direct relief for Minnesota homeowners and more than $200 million in state aids to local governments. Senator Rod Skoe and Tax Committee Chair Senator Tom Bakk (DFL-Cook) worked on the proposal, which fulfills the priorities outlined in the Property Tax Relief Act announced on the first day of the 2007 Session. It expands residential and agricultural land market value credits and increases homeowners property tax refunds thus reducing property taxes. State aid to cities and counties will also be boosted under this legislation in order to help reverse dramatic cuts to local governments in recent years. This provision will help cities and counties across the state provide essential services to residents including police and fire, libraries, parks and recreation, while keeping property taxes in check. The Property Tax Relief package includes: $150 million for Local Government Aid, returning to 2003 funding levels -The City of Duluth is projected to receive $32, 652,088 (a 17.3% increase) in LGA in 2008 $60 million for County Program Aid -St. Louis County can expect to receive $14,287,327 (a 23.5% increase) in County Program Aid in 2008 $15 million for Township Aid
2 $24.4 million increase in the Property Tax Refund Program $41.9 million increase in the homestead market value credit $9 million increase in the agricultural land market value credit Senate Research estimates project that the infusion of new dollars into the Homeowner Property Tax Refund Program will allow a family with a household income of $70,000 to receive an average $746 property tax refund, $62 more than under current law. Minnesota homeowners with homes valued at $200,000 would see an average 4.9% reduction in their net property tax bills through aids and credits included in this bill, paying about $99 less than they are today. Prettner Solon Bill Addresses Funding for Duluth Family Residency Program In response to the declining number of family practice physicians in Greater Minnesota, Senator Prettner Solon introduced legislation that would increase funding for the Duluth Family Medicine Residency Program and the Duluth Medical School. The Duluth Medical School produces more family doctors for Greater Minnesota than any other residency program in the state. However, state funding for the Duluth program has not kept pace with inflation requiring the local hospitals St. Lukes s and St. Mary s/duluth Clinic to make significant financial contributions to support the program and educational process. This places the hospitals in a financial hardship given the recent and ongoing reductions to hospital reimbursement and the high degree of uninsured and under-insured patients in the Twin Ports area. This bill was heard Wednesday in the Senate Health, Housing & Family Security Committee. Senator Prettner Solon wanted to bring committee members attention to this situation in Greater Minnesota and pursue avenues to address this growing problem. Dr. Tom Day of the Duluth Family Medicine Residency Program, Mr. John Strange, CEO of St. Luke s Hospital, Duluth, and Dr. Terrence Clark from SMDC Health System were on hand to testify, as well. The bill awaits a hearing in the Senate Finance Committee. Northeast Entrepreneurial Fund Bill Heard in Senate Committee Today Senator Prettner Solon presented SF 1354 before the Senate Economic Development Budget Division. This bill would appropriate $500,000 over the biennium from the general fund to expand the capacity of the Northeast Entrepreneur Fund to help entrepreneurs start and grow their businesses in northeastern Minnesota.
3 Since 1989, the Entrepreneur Fund has helped start, stabilize, or expand over 900 businesses, creating or retaining over 2,300 jobs in northeastern Minnesota. Its loan funds have made 450 loans, totaling $6.6 million, and helped businesses leverage an additional $14 million in financing from public and private sources. Over 7,700 people have accessed the Entrepreneur Fund s business training and technical assistance services. Entrepreneur Fund services focus on creating successful business owners and healthy businesses. Training, technical assistance and support are critical elements of business success. Remarkably, over 85% of the business owners, most of whom are start-ups, are still in business 2 years after receiving assistance. The Entrepreneur Fund helped the owners of Brigham Upholstery in Duluth transform their business from a custom upholstery job shop to a manufacturing facility. Brigham has, since, the inception of Cirrus Aviation, provided the interior finishing for all Cirrus airplanes. Mary Mathews, president of the Northeast Entrepreneur Fund and Carol Willoughby, owner of Let the World Know of Duluth testified in support of the bill. The bill was laid over for possible inclusion in the Economic Development Omnibus Appropriations Bill. Senate Energy, Utilities, Technology and Communications Update This week Senator Prettner Solon s Energy Utilities, Technology and Communications Committee passed several low income energy bills. Senator Prettner Solon is sponsoring legislation that requires utility companies to compile monthly reports relating to the state s current cold weather rule, which prohibits utility companies from shutting off heat because of past due bills during winter months. The reports would have to contain the number of disconnections, amounts of past due bills and other information about low income subscribers and energy usage. This information will be helpful to the legislature in crafting future bills that deal with low income energy assistance issues. Other legislation passed by the Committee requires utility companies to establish affordable programs for low-income ratepayers. Currently only a few companies have such programs. Carbon Sequestration Legislation Passes Two Hurdles This week, Senator Prettner Solon presented legislation that would fund studies and other activities related to terrestrial and geologic carbon sequestration, or the capture and storage of atmospheric CO2 in plants, soils and deep geologic formations. Preliminary studies at the University of Minnesota indicate that terrestrial or biological sequestration could play a role in reducing the state s net CO2 emissions. Due to current discussions about reducing CO2 emissions in an effort to offset global warming, Senator Prettner Solon views finding ways of
4 capturing carbon emitted from power plants and cars as an important way to reduce harmful greenhouse gas emissions. Finding storage methods for carbon will help deal with environmental and health issues without increasing utility rates or impacting service reliability by shutting down necessary base load power plants. The study legislation passed the Senate Environment and Natural Resources Committee and is being considered for inclusion in the Senate Environment, Energy and Natural Resources Budget Division s Omnibus Appropriations Bill. Transportation Funding Bill Passes Budget Division This week the Senate Transportation Budget and Policy Division passed a comprehensive transportation funding package that will make necessary investments in Minnesota s transportation infrastructure. The Senate package contains a variety of funding sources to meet the state s transportation needs, and once fully phased-in in 2012, will increase transportation funding by approximately $1.1 billion per year. The bill includes a 10-cent increase in the state s gas tax, which is estimated to generate $320 million in new revenue per year. The legislation provides a half-cent sales tax increase in the seven county metropolitan area for transportation funding. Counties contiguous to the metropolitan area would have the option to impose the tax and join the Joint Powers Board. The sales tax increase revenues would be allocated no less than 40% for transit, no less than 30% for trunk highways and local roads, and no more than 5% for pedestrian and bicycle-integration programs, all within the metropolitan area. The bill also authorizes Minnesota counties to impose a $20 per vehicle wheelage tax for transportation funding. It further removes caps on vehicle registration taxes that were passed during the Ventura Administration, capturing back about half of the tax decrease. An owner of a vehicle on which registration tax has already been paid under current law will not pay a higher tax on that same vehicle. Additionally, this bill allocates the revenues collected by the motor vehicle sales tax (MVST). Once the MVST amendment is fully phased-in in 2012, 60% of the revenues will be used for roads and 40% will fund transit projects. Of the 40% going towards transit, 36% will go to the metropolitan region and 4% will fund transit programs in Greater Minnesota. Sales tax revenues generated by leased vehicles will be allocated 50% towards roads and 50% towards transit. Of the transit funding, 37.5% will go to the metropolitan area and 12.5% to Greater Minnesota.
5 The bill was re-referred to the Senate Finance Committee. Bill for Forestry Research Heard in Environment Budget Division Senator Prettner Solon presented Senate File 1471 a bill that will appropriate $200,000 annually to the Minnesota Forest Productivity Research Cooperative before the Senate Committee on Environment, Energy and Natural Resources Budget Division on Thursday. In response to concerns about the competitiveness of the state s forest industry, a Governor s Advisory Task Force on Competitiveness of Minnesota s Primary Forest Products Industry recommended steps to increase the competitiveness of the state s forest products sector. Among the top concerns identified by the Task Force was timber resource availability and price. Further, the Task Force recommended support for research to increase forest productivity and thereby augment future fiber supplies. In response to these recommendations, industry representatives, public agencies and research organizations have formed a cooperative effort to address this research need. The mission of the Forest Productivity Research Cooperative is to increase the economic value of Minnesota s timber resource by improving the quality and quantity of fiber through silvicultural research and transfer of that technology to natural resource professionals and landowners. This will be accomplished by: Focusing on applied research in cooperation with industrial, public agency and other landowners Using resource analyses to guide research priorities and analyze impacts of results Developing techniques that have immediate impact and improve economic returns to landowners Technology transfer to natural resources professionals and landowners Promoting synergy with existing research efforts and knowledge Focusing on strategic commercial species This effort is a collaboration of industry, university and government land agencies. At this time, project principals include Boise, Potlatch Corporation, International Paper, Minnesota Power, UPM-Kymmene, the University of Minnesota-NRRI and the St. Louis County Land Department. The Minnesota Department of Natural Resources, the USDA Forest Service and the U of M College of Natural Resources are cooperating agencies. Presently we are seeking support from the Legislature for a portion of the funds needed to support this effort. This annual $200,000 amount will be matched by member organizations in the amount of a 1:1 state:industry match, composed of a combination of cash and in-kind contributions of land for experiments and demonstrations, site maintenance and technical personnel. The bill was laid
6 over for possible inclusion in the Environment, Energy and Natural Resources Omnibus Appropriations Bill. Price of Government Each budget year, the Legislature is required by law to pass a resolution on the price of government a limit on how much the state can collect from residents in taxes and other revenue for a two-year budget cycle. The resolution also lays out how the money collected will be divided between state and local services. On Wednesday, the Senate passed the Price of Government Resolution for It says the state will not collect more than 16.4% of personal income in taxes and other revenue during the next two years. In other words, the price Minnesotans will pay for local and state government services will be just over 16 cents for every dollar earned. This is the same amount that was collected during the past biennium. In fact, since 2001 the price of government has hovered around the 16% range; that is significantly less than during the 1990s when the price of government reached as much as 17.9%. In that same resolution, the Senate agreed to divide the money collected by allocating 63% for state services and 37% for local services. This, too, is very close to previous splits. The only difference is that the state share increases slightly and the local share is somewhat reduced, to account for property tax relief the Senate hopes to approve this year and pass onto local property taxpayers. The House passed a Price of Government Resolution that is slightly different than the Senate version, meaning the two bodies will meet in conference committee in the coming weeks to reach a compromise. Higher Education Omnibus Bill Receives Approval The Higher Education Committee approved their omnibus bill this week, which appropriates $296 million in new money for state colleges and universities in Minnesota for 2008 and The bill includes $36.5 million in changes to financial aid for students, $10 million for veterans assistance with higher education costs, and a $2.25 million increase to the Mayo Medical School and Residency Program. The bill will also eliminate non-resident tuition by the 2009 academic year. It would start a loan repayment study to measure the feasibility of identifying professions with economic and/or social importance to the state and provide repayment assistance for student loan debt for specific professions.
7 Senate Forwards One-Time Money Spending Priorities The Senate State Government Budget Division, chaired by state Sen. Don Betzold, met this week and forwarded their intentions of investing one-time dollars that are available in the current budget. The committee agreed to support language calling for a total of $16 million in one-time money to be spent on a number of needed state initiatives. Among the items agreed to by the committee were: $3.6 million for the implementation of an electronic licensing system, administered by the Office of Enterprise Technology. As envisioned, the system would allow Minnesotans to purchase and renew professional licenses electronically. $90,000 for the Office of Enterprise Technology to update the computer systems at a number of smaller state agencies. $123,000 for the Secretary of State s Office to modify Minnesota s absentee voting system and make it easier for people to vote via absentee ballot. $2.5 million to help statewide public television systems convert to a digital broadcast signal. $2.5 million to upgrade the Senate technology systems, to provide better constituent service via an updated and faster system. $885,000 to the Department of Administration to relocate the Public Safety Emergency Operations Center. $502,000 to Minnesota Public Radio to extend the signal to all of the state and to help with digital conversion. $80,000 to the Indian Affairs Council for relocation and reburial of some Native American remains. $315,000 to the Department of Finance for legal counsel as the state seeks to have Northwest Airlines honor their lease on a maintenance facility in Duluth that was partially funded by taxpayers. The committee also agreed to forward a bill for $130 million for stage one of much-needed renovation and repair to the State Capitol building. The plan, which would be completed within the next decade, calls for securing building entrances and expanded meeting space, as well as heating and cooling changes to the building, which is more than 100 years old and is facing serious structural problems. Agriculture and Veterans Omnibus Bill Moves Ahead Members of the Agriculture and Veterans Budget and Policy Division approved their omnibus finance bill on Tuesday and sent it to its next stop, the Finance Committee. The Department of Agriculture is appropriated $ million in additional funding, bringing the total to $ million. New spending in the department includes $4.5 million for Clean
8 Water Legacy and $3 million for bio-energy best management practices loans. The Animal Health Board is appropriated $ million. Most of the $1.023 million in new spending is dedicated to efforts to eliminate bovine tuberculosis. The Agricultural Utilization Research Institute receives $4.6 million under the proposal, including $1.4 million in new money for technical assistance and technology transfer to bioenergy crop producers and users. The proposal provides $ million for the Department of Military Affairs, an increase of $4.186 million over the forecast. The additional funds include $1.5 million for a reintegration program for returning soldiers. The Department of Veterans Affairs receives $ million, including a $9.562 million increase, primarily for veterans outreach efforts. The total package provides $ million in FY 08-09, including $ million from the General Fund. Public Safety Division Passes Omnibus Budget Bill Wednesday, the Senate Public Safety Budget Division passed a Public Safety Omnibus Budget Bill that provides funding for public safety and crime-prevention programs across the state. The bill provides $75 million in new, ongoing funding for FY The bill will be heard in the Finance Committee next week. The bill includes several funding priorities for the Department of Public Safety, including $23 million to finish the implementation of the statewide 911 emergency services; $2.8 million for 20 new Bureau of Criminal Apprehension (BCA) forensic scientists; a $2.5 million increase for the Gang and Drug Task Force; and grants for several crime-victims programs. The bill also includes $658,000 for the Peace Officers Standards and Training (POST) to conduct training on domestic abuse no-contact orders. The bill allocates funding to the Department of Corrections for several probation and supervised-release programs, including $5.6 million to increase funding for the Community Corrections Act, funding for county and state probation officers, and funding for sex offender management supervision and community-treatment programs. In addition, the bill provides $5 million for short-term offender reimbursements to counties. Currently counties are being reimbursed at about $9 per day for each offender. This funding would increase reimbursements to $33. The committee also passed a Public Safety One-time Appropriations Bill that includes $12 million in one-time funding for CriMNet improvements and several local public-safety initiatives.
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