ST. PAUL, Minn. (WCCO) — With time running out in this year’s session, Minnesota lawmakers appear to be close to a deal for the next state budget.
It doesn’t involve taxing clothing or any changes to the alcohol tax, but there will be some noticeable changes for some people.
Gov. Mark Dayton and other DFL leaders met until late Thursday night trying to work out a budget deal. Right now the state is facing a $627 million deficit. With the proposed tax hikes, the state could bring in $2 billion over the next two years.
The plan includes raising taxes on married couples who make more than $250,000 a year or single people who make $150,000 a year by two percentage points. The tax on tobacco will more than double. People will now pay an extra $1.60 for a pack of cigarettes.
DFLers said some of the surplus revenue will also help them pay back the millions owed to public schools.
“The purpose is to repay the $800 million that we owe the schools by the end of the next two years and that’s a commitment that the House in particular felt was important, and it does show up on the books as another $800 million in spending but it’s really a separate category from all the rest,” said Dayton. “It’s obviously not ongoing and it puts us on a solid, sound fiscal footing for the next two years and the one following.”
Republicans have not been part of the closed door negotiations. They believe the tax increases will impact more than just people who smoke and the wealthy.
Lawmakers have until midnight to wrap up the legislative session. There has also been talk this session about increasing the minimum wage. With just days left in the session it’s unlikely a bill would pass because DFLers can’t agree how much to raise it.
The Senate voted to raise it to $7.75 an hour, 50 cents above the Federal level, but DFLers in the House wanted it higher. Senate Majority Leader Tom Bakk said yesterday that a minimum wage hike this session is highly unlikely.