Propane aid outpaces tax relief on Legislature’s first day

Published 9:19 am Wednesday, February 26, 2014

By Tim Pugmire

Minnesota Public Radio News, 90.1 FM

ST. PAUL — The Minnesota Legislature opened the 2014 session Tuesday, and lawmakers immediately went to work on a $20 million emergency measure to help low-income families heat their homes.

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A propane fuel shortage this winter, combined with the relatively late start of the legislative session, prompted lawmakers to take some extra quick action on a funding measure for the Low Income Home Energy Assistance Program, also known as LIHEAP.

The bill “recognizes that Minnesotans across the state are struggling to keep up with their heating needs, and it appropriates $20 million of state money to the LIHEAP program,” said Rep. Joe Radinovich, DFL-Crosby. Without the funds, the LIHEAP program will be “unsustainable in early March.”

The House passed the measure 133-0 and sent it on to the Senate, which doesn’t plan to take action until Monday.

Senate Majority Leader Tom Bakk, DFL-Cook, said he’s not yet sure if the program needs the full $20 million, or if it needs it immediately.

The Senate Finance Committee will hold a hearing on the bill Wednesday.

Taxes and tax relief will also be important issues in this session. But Bakk, who is not up for re-election this year, is also taking a much slower approach than the House.

So far, he’s made no commitments to any of the proposals to conform to the federal tax code or roll back any of the three business-to-business sales taxes passed last year.

With all House members on the ballot this fall, House Speaker Paul Thissen said the tax issues are a session priority. That’s why the House tax committee spent opening day working on several bills.

“We want to focus in on middle class tax relief. So the federal conformity, eliminating the marriage penalty, addressing the adoption tax credits, a number of those things are going to be very important to us,” said Thissen, DFL-Minneapolis. “Because the economy has improved, we are in a position if the surplus holds up, to roll back those business to business tax credits, and we look forward to doing that as well.”

Republicans opposed the business taxes last year and want them eliminated this session. House Minority Leader Kurt Daudt said he plans to hold Thissen to his word on taxes.

“Last session we said that the damaging tax increases that the Democrats passed were unnecessary. We see now that that’s the case,” said Daudt, R-Crown. “Our plan at this point is to make sure Minnesotans get their money back, and we’re going to be here holding Democrats accountable to that.”

Gov. Mark Dayton, a Democrat, also is pushing for tax relief in the year he’ll campaign for a second term.

Dayton, who’s still recovering from hip surgery, told reporters in a conference call that he wants $600 million in tax reductions, if Friday’s new economic forecast still shows a healthy surplus. He also said he wants lawmakers to act by March 14.

“The warehouse tax is scheduled to begin April 1. So, if the Legislature acts expeditiously, that tax will never be imposed, and that will make life easier for the Department of Revenue and especially for a lot of the people in Minnesota otherwise who would be affected by that tax.”

The unresolved minimum wage issue from last session was also getting opening-day attention. A coalition of groups held a late-afternoon rally in support of an hourly minimum wage of $9.50 by 2015. That’s the rate passed by the House last year. But the Senate passed a $7.75 measure.

Conference committee negotiations are expected to start up in the coming days.