The 2018 Legislative session will end at midnight on Sunday, May 20. This leaves little time for the Legislature and governor to come to an agreement on a wide range of issues. Below are a few of the major initiatives the IFO continues to advocate for or against.

Conference Committee adopts higher education budget and policy
The supplemental budget conference committee has adopted the higher education article. The higher education budget target agreement is $3 million in new funding. That money is appropriated to MinnState for campus support. This agreement is the GOP higher education funding position as they begin negotiations with the governor. The governor proposed $10 million in campus support for MinnState.

There is an additional $1 million (one-time) of surplus funding available from the college occupational scholarship pilot program administered by the Office of Higher Education. That surplus is appropriated as follows:

$500,000 to Minnesota State for renewal of workforce development scholarships.
$300,000 to the Office of Higher Education for the State Grant Program.
$200,000 to the Office of Higher Education for the Agricultural Educators Loan Forgiveness program, a student loan debt counseling program and a teacher preparation program design grant.

Also included in the bill is language regarding developing a textbook plan. Minnesota State is required to develop a plan to increase the use of affordable textbooks and instructional materials. The plan must establish a goal for the percentage of all courses offered at state colleges and universities that will use affordable textbooks and instructional materials.

House approves $825 million bonding bill
The House took up the bonding bill on the floor today and passed it by a vote of 84-39. By law, a bonding bill needs a three-fifths majority, which is 81 votes, in order to pass. As shared earlier, the House provides for $123 million in bonding for Minnesota State, of which $40 million is for asset preservation.

Full Senate has yet to take action bonding bill
In the Senate, the Senate Finance committee took up the Senate bonding bill, and after passing three technical amendments, and much discussion regarding the bill, committee members passed the bill and sent it to the Senate floor where it will be heard next. The Senate bill includes $120 million for Minnesota State, of which $65 million is for asset preservation.

The Governor has proposed $1.5 billion for bonding and includes more than $240 million for MinnState projects, including $180M for HEAPR.

Pension reforms await action by full House
On Monday evening, the House Ways and Means Committee passed the Pension reform bill and sent it to the House floor for final action. The Senate passed the same bill 66-0 a few weeks ago.

Sexual harassment definition
The bipartisan effort to change the Minnesota Human Rights Act’s definition of sexual harassment has stalled in the Senate. The change would have added, “An intimidating, hostile, or offensive environment does not require the harassing conduct or communication to be severe or pervasive.” This would change the standards required under current law for the courts to take action on a sexual harassment case.

Attacks on state employees
The supplemental budget conference committee has not adopted the State Government article. The House included a few provisions that are direct attacks on state employees in their version of the State Government bill.

Taxes
GOP majorities in the Legislature have come to an agreement on a tax conformity/reform package. The agreement calls for first-tier tax rate to drop from 5.35 percent to 5.3 percent in tax years 2018 and 2019 and 5.25 percent beginning in tax year 2020. The second-tier tax rate would drop from the current 7.05 percent to 6.95 percent in tax years 2018 and 2019 and 6.85 percent beginning in tax year 2020.

These changes would result in a $137.1 million revenue decrease this biennium and $341.1 million in the next.

A corporate tax reduction is called for in tax years 2018 and 2019 from 9.8 percent to 9.65 percent. It would drop to 9.1 percent in tax year 2020, changes resulting in $22.9 million in reduced revenue this biennium and $122.7 million in the tails.

The governor made it clear in his press conference on Monday that he would not consider the GOP tax proposal until they take action on his $137 million “emergency funding” package for K-12 education.

Dedicated Transportation Funding Constitutional Amendment
Neither the full House nor Senate has taken action on the general fund busting transportation constitutional amendment.

Please contact me with any questions.