Dayton poised to veto tax cut bill

Published 10:14 am Monday, June 6, 2016

ST. PAUL — Gov. Mark Dayton is poised to veto a tax-cut bill touted by Minnesota House Republicans as one of their accomplishments of a legislative session that ended in chaos last month.

Dayton says the bill has a drafting error that puts some $102 million in taxes on charitable gambling in jeopardy. The state is counting on that money to help pay its share of the Minnesota Vikings’ new stadium.



The error could be fixed in a special session, but Dayton wants Republican leaders to agree to his conditions before calling them back. Those include additional spending and borrowing that would benefit public colleges and universities and transit projects in the Twin Cities.

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“All they have to do is agree to my conditions, which are eminently reasonable,” Dayton said Friday. “They put themselves in this position.”

House Speaker Kurt Daudt said he has agreed to fix the drafting error and to restore a tax break the Minnesota High School League uses to fund sports programs for low-income students. He accused the Democratic governor of being unreasonable.

“He made two demands of the tax bill. I agreed to both of them. Now he says he’s going to veto it,” Daudt told the Star Tribune in an interview. He said Dayton “is playing an incredibly high-stakes game of chicken.”

Dayton has until Monday evening to sign the tax relief bill. House Republicans are counting on provisions in the tax bill as well as stalled public works and transportation bills that would benefit their districts. All legislative seats are on the November ballot this year, but the governor’s office is not.

For the second time in two years, Minnesota lawmakers ended the regular session in a last-minute rush and unfinished business. A $1 billion-plus package of public works projects and a major transportation funding bill — a top priority for the last two years — both failed to pass this year.

Farmers and small business owners, college loan debtors and applicants, cigarette smokers and others would see relief under the tax package. The bill includes $259 million in tax relief next year and ongoing after that, along with increases in financial aid to local governments statewide.

“It was passed overwhelmingly by both houses of the Legislature,” said Rep. Steve Drazkowski, R-Mazeppa, who helped put the bill together.

If Dayton vetoes the tax bill, Drazkowski said he does not think Republican leaders should continue pursuing a special session.

“Obviously the governor at that point is not acting in good faith,” he said.