Capitol View: February 10, 2011 Archive

Dayton suggests a sunset to his income tax hike

Posted at 9:45 AM on February 10, 2011 by Tom Scheck
Filed under: MN Legislature, Mark Dayton

Listen to Dayton on Midmorning

On MPR's Midmorning, Governor Dayton said "that might be part of it" when asked if he would consider proposing an income tax hike that lasts only two years

Dayton suggested during his State of the State speech that such a tax would be included when he asked business leaders to "give him two years."

MPR Midmorning host Kerri Miller asked if he had a timeline to such a tax. He referred to his statement during the State of the State.

"Well, I hope to do it sooner," Dayton said of a possible sunset to the income tax. "And if the conditions improve, if there were something like that, then we'll be able to deal with that starting next year. I hope we can get a rapid improvement but I'm trying to be realistic here."

Dayton didn't fully commit to an income tax hike that would blink off but he suggested it's a possibility. Dayton said his plan will increase income taxes on top earners but he declined to offer greater specifics. He releases his full budget plan next Tuesday.

$900 million budget cut headed to Dayton

Posted at 3:05 PM on February 10, 2011 by Tom Scheck
Filed under: MN Legislature, Mark Dayton

The Republican-controlled Legislature has sent a $900 million package of spending cuts to Governor Dayton, who has repeatedly criticized the bill as "piecemeal" budgeting.

The Minnesota Senate passed the bill on a party line vote today 37-28. The House passed the same measure Wednesday.

The bill cuts spending on state aid to cities and counties, colleges and universities and social services programs. It also directs the Dayton administration to eliminate $100 million from current state agency budgets.

Republican Senator Julianne Ortman of Chanhassen said the bill is a reality check, and the first piece of a solution for a $6.2 billion state budget deficit.

"The reason to do it now is so that our budget deficit is reflected in our forecast, which comes out later this month," Ortman said. "We can reduce it by almost $1 billion. I hope the executive branch will accept the reality check and accept this bill."

Supporters say early action on a partial budget fix will influence the next state economic forecast and shrink the projected $6.2 billion budget deficit. But Senate Minority leader Tom Bakk said Republicans were poking the governor in the eye, by sending him a bill he doesn't like and had no say in.

"If we're going to get bills signed into law, the Legislature has to involve the executive branch," Bakk said. "We can't get anything into law without them. If we're not going to involve them, then it's just all theatrics, and we're all just playing politics and we're all just grandstanding. Exactly what the public doesn't like."

Bakk and other Democrats also say the bill will drive up local property taxes and college tuition. They also said the cuts were assembled with little public input.

Governor Dayton had repeatedly criticized the GOP bill as "piecemeal" budgeting but has refused to say whether he'll veto the measure. Dayton will release his budget plan on Tuesday.

That didn't take long. Dayton vetoes budget bill

Posted at 5:13 PM on February 10, 2011 by Tom Scheck
Filed under: MN Legislature, Mark Dayton

It took Gov. Dayton less than two hours to veto a bill that cuts $900 million in state spending. The Minnesota Senate passed the bill earlier today on a party line vote and sent it to Dayton. The measure cuts funding for higher education, health and human services programs and aid to cities and counties. Republicans have argued that cuts were a good start in fixing the state's budget.

In his veto letter, Dayton wrote that the cuts in local government aid would force local governments to raise income property taxes and that their plan is unconstitutional because it doesn't specify where the governor should cut $100 million in spending. Dayton also complained Republicans in control of the House and Senate should address the state's $6.2 billion projected budget deficit in totality instead of taking a piece meal approach.

Dayton will release his budget plan next week. He said he'll increase income taxes on Minnesota's top earners to solve part of the deficit. Republicans oppose a tax increase of any kind.

Here's Dayton's veto letter:

veto letter

Dayton hires former Campaign Finance Chair to run Trade Office

Posted at 9:20 PM on February 10, 2011 by Tom Scheck
Filed under: MN Legislature, Mark Dayton

Gov. Dayton has hired the person who managed the finances for his gubernatorial campaign to head the Minnesota Trade Office. Some Republicans are raising questions about the hire because Dayton repeatedly called for eliminating the office when he was campaigning for governor. Dayton appointed Katie Clark, who worked for Target Corporation and National Wind, to run the agency. She was his campaign finance director last year.

GOP House Speaker Kurt Zellers said he didn't want to question Clark's credentials but did ask whether Dayton should have hired someone who played such a big role in his campaign.

"If it makes you kind of cringe when you talk about it, that's maybe a pretty good standard that it's not something to do," Zellers said. "It's just the process that makes you uncomfortable."

It isn't unusual for elected officials to hire their campaign staff when they take office. Former Gov. Tim Pawlenty hired several people who either worked for him or backed his campaign. He also hired many of his GOP colleagues from the Minnesota House. But the importance the economy, and trade in general, are playing in politics right now highlights the importance of the position.

In an interview with MPR News, Dayton defended the hire. He said he had deep concerns over how the Minnesota Trade Office has languished over the past 10 years. He said Clark will improve how the office is run.

"She was a team leader at Target Corporation, and she's going to provide the kind of professional, private sector initiative on behalf of the Trade Office that has been lacking. I was critical of the Trade Office based on my two terms as Economic Development Commissioner."

Dayton, who has said he thinks increased trade is one of the keys to improving the state's economy, added that he was even more concerned about how the office was run when he met with a Chinese delegation that recently visited Minnesota. He said he's instructing the commissioners of the Department of Employment and Economic Development and the Department of Agriculture to work with Clark to improve the agency.

As for his earlier call to close the Trade Office, Dayton says it's not his top priority right now.

"I'm right now focused on larger matters before the state, but that may well be part of a reorganization of state government proposal that I'll submit to the Legislature."

Sen. Geoff Michel, R-Edina, who chairs the Senate Jobs and Economic Growth Committee, said he's not prepared to comment on Clark's qualifications but he said he'll be watching very closely to see how Dayton handles the office.

"I don't think it's clear where candidate Dayton and now Gov. Dayton wants to go with the Trade Office. I think it's an important matter," Michel said. "I think who staffs a Trade Office and even if there should be a Trade Office is an important matter for us to consider."

Michel says he intends to keep tabs on how Dayton handles the future of the Trade Office. But he'll have little say regarding Dayton's decision to hire Clark since she does not have to be confirmed.

Clark's salary is $90,828.