ST. PAUL, Minn. (AP) — Leaders of the Minnesota House Democratic majority unveiled a budget framework Monday that is similar to Democratic Gov. Tim Walz’s proposed budget but adds a tuition freeze for students at public colleges and universities.
The broad outline also moves more aggressively to close corporate tax loopholes compared with the governor’s budget to free up more money for education. And it adds about $200 million earmarked for local projects to Walz’s $1.3 billion public construction borrowing proposal, which purposely left it up to lawmakers to decide how much they want for local needs.
But the plan contains more similarities than differences, including the governor’s proposal for raising the gas tax by 20 cents per gallon to pay for road, bridge and public transit improvements; and his plan to preserve the state’s 2 percent tax on health care providers , which funds health care programs that serve more than 1 million Minnesotans. Republican leaders want to let that tax expire as scheduled at the end of the year.
House Speaker Melissa Hortman said at a news conference that the framework “restores tax fairness and makes historic investments in education.”
Overall, the plan is about the same size as Walz’s $49.4 million budget for the two-year period that starts July 1. It leaves $563 million as a cushion for the next two-year budget, almost exactly what the governor proposed.
Leaders of the Senate GOP majority will release their own budget framework Thursday. Senate Majority Leader Paul Gazelka said it will use the state’s projected $1 billion surplus to fund their priorities without raising taxes. He said in a statement that House Democrats have joined Walz “in a contest to see who could tax and spend the most.”
The House Democratic and Senate Republican outlines will both set targets for legislative committees, which will then adjust their major spending and tax bills to fit the available money. That will set the stage for what are expected to be tough negotiations over spending and taxes in the final weeks of the legislative session, which must end by law by May 20.
“We will be, I think, having a major discussion with the Senate about whether we’re going to cook the books and make things look good for the next two years or whether we’ll have a real budget in place,” Majority Leader Ryan Winkler said.
While the House leaders wouldn’t give specifics of the tax changes they’ll propose, they said they’ll include a crackdown on foreign tax shelters and other moves to roll back what they consider the unfairness of the 2017 federal overhaul, which they contend was tilted toward the rich. Some details will start coming out Wednesday, with more in a couple weeks when the main House tax bill is unveiled, Taxes Committee Chairman Paul Marquart said.
Walz said he saw “lots to like” in the House framework. His statement said he was still looking at the details but looked forward to working with the leaders.
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