At a Sunday afternoon press conference, Gov. Mark Dayton and lawmakers announced a budget agreement that they claim will make good on campaign promises by creating a fair tax system for all.
Dayton, standing with the House Speaker Paul Thissen and Senate Majority Leader Tom Bakk, unveiled the spending and revenue targets for the 2014-2015 fiscal year, describing it as a framework for a "fair and responsible budget that invests in the middle class."
The trio had been working in conference after both chambers of the Minnesota Legislature passed very different bills, and a few of the more controversial elements appear to have been dropped. For instance, there will be no expansion of the state sales tax to clothing or any other goods or services.
Taxes certainly will be raised in some ways, however. Dayton campaigned on creating a fourth-tier income tax bracket for the state's highest 2 percent of earners, and the compromise bill would raise the rate of couples making $250,000 and up and singles making $150,000 and more by a rate that has yet to be determined.
Cigarette taxes are also slated for an increase, but by how much is still up for debate. Similarly, an increase on alcohol taxes could be on the table if lawmakers choose to explore it.
Tax relief is also included, with $400 million allocated for easing property tax burdens.
In terms of spending, the budget plan invests heavily in education and seeks to provide full funding for all-day kindergarten starting in 2014. The plan would also repay all debts lingering from the school funding shifts in the next two years.
In this area, the plan pops out some ambitious figures, including an historic $725 million investment in education, with $475 million directed at primary and grade schools and $250 million to higher education.
Leaders say those investments will be made possible by asking the wealthiest residents to pay their share of taxes and by closing corporate tax loopholes while reforming the tax system to be more fair for middle-income residents.
Dayton, Thissen and Bakk released the following statement about the plan:
"When the legislative session began, we shared the goal of progress for Minnesotans on education, job creation, and better government. This budget delivers on our promise of progress.
"We agreed that we needed to put middle class Minnesotans first. We agreed on the need to invest in education, from early learning through higher education. We agreed it was time to put fairness back in the tax system, close the deficit, and balance the budget for the long term without games or gimmicks. Today, we are pleased to announce a budget framework agreement that accomplishes these priorities and moves Minnesota forward.
"Our plan eliminates the projected $627 million deficit and balances the state budget for the next two bienniums with no gimmicks or shifts. We pay back, in the next biennium, all of the money still owed to our schools. We make historic new investments in education, including early childhood scholarships and funding to provide all-day kindergarten for all of Minnesota's children. We make major new investments in new job-creating incentives for businesses to locate or expand in our state. And we spend $400 million to provide very significant property tax relief for Minnesotans, while asking the very wealthiest Minnesotans to pay their fair share in income taxes."
WHBQ-TV | Fox 13
Didn't find what you were looking for?