Dayton 'Personally Disappointed' By Lack Of Tax Deal

ST. PAUL, Minn. (WCCO/AP) — Democratic Gov. Mark Dayton and legislative leaders agreed Wednesday to a one-day special session Sept. 9 to approve relief for areas hit hard by storms in June.

The session will be limited to storm relief despite some bipartisan support to repeal a recently enacted sales tax on farm equipment repairs. Minority Republicans also wanted discussion of repealing other new taxes approved by the Democratic-controlled Legislature last spring.

But House Speaker Paul Thissen, a Minneapolis Democrat, said the two sides couldn’t reach agreement on tax changes and agreed to focus on storm damage.

“We’ll do what we’ve done in the past, which is make sure our first and top priority is getting relief to the folks who really need it across the state of Minnesota,” Thissen said.

President Barack Obama recently signed a federal declaration for 18 counties hit hard by storms, high winds and flooding in late June, paving the way for federal aid. But that money must be matched by $4.5 million from the state. The money will help pay for repairs to damaged public infrastructure.

Waves of heavy storms over several days in June downed trees, caused flooding and knocked out power to more than a half-million customers across a wide swath of the state.

The counties covered by the declaration are Benton, Big Stone, Douglas, Faribault, Fillmore, Freeborn, Grant, Hennepin, Houston, McLeod, Morrison, Pope, Sibley, Stearns, Stevens, Swift, Traverse and Wilkin. The storms occurred between June 20 and 26.

Dayton said Rock and Nobles counties could be added to the list to pay for damage stemming from ice storms last winter. That could add $1.1 million to the tab.

Dayton said he was “personally disappointed” by the lack of a tax deal, but that lawmakers could figure out replacement money for the budget next year.

“I’d like to get rid of the taxes too,” Dayton said, adding that there would be consequences to any such move.

The farm tax, he said, deserved special consideration. By his account, the farm tax was accidentally included in the new state budget. He said it doesn’t make sense because farm equipment purchases and parts remain exempt from taxes while repairs carry an extra charge.

House Minority Leader Kurt Daudt, R-Crown, said the pressure to repeal the other taxes won’t subside and will be front and center when legislators return for the 2014 session in February. Aside from the farm tax, Republicans have called for the elimination of new taxes on warehousing services and telecommunications equipment.

Senate Majority Leader Tom Bakk, DFL-Cook, said officials had identified a source for the $28 million cost of repealing the farm tax but couldn’t fill the hole that would result from scrapping the other taxes.

“They wanted to spend more money than was on the bottom line,” Bakk said of Republicans.

Sen. Dave Thompson, a GOP candidate for governor who pushed for a broader tax repeal agenda, said the limited agenda was a disappointment but he blamed Democrats for playing hardball.

“We should have done what we could to at least partially fix it during the special session,” Thompson said, adding he was concerned that the taxes would be in place — and problematic for Minnesotans — for at least six months.

Another Republican gubernatorial candidate, Rep. Kurt Zellers, said there “is no defensible reason” to adjourn without taking up the tax matters.

The heads of the two parties and the governor signed a written agreement not to take up other bills. But that won’t stop members from introducing them to make a point.

(TM and © Copyright 2013 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2013 CBS Broadcasting Inc. Used under license. All Rights Reserved.This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)


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