Gov. Walz Offers Reduced Gas Tax Hike As Budget Meetings Continue

MINNEAPOLIS (WCCO) – Monday marks the final week of the 2019 legislative session, and Minnesota lawmakers still have to do their most important job – pass a plan for taxes and spending for the next two years.

By law, that budget needs to be passed in just seven days by next Monday.

Budget negotiations have been happening since 2 p.m. Unlike other budget negotiating sessions, we are actually seeing a back and forth with specific proposals and each side compromising.

Republicans have offered to spend $100 million more on education and public safety, but they are saying no to any new taxes, including the gas tax and the 2% medical provider tax that generates $700 million a year in medical care costs mostly for low-income individuals.

The Governor says the 2% medical provider tax has to stay, but he has come down several times on his spending proposals.

His biggest concession is a 4-cent per gallon drop in his gas tax proposal, which would make the increase over several years 16 cents, not 20.

"This was trying to show them we're willing to work with you on this. People saying 'no' is not government and it is not compromise," Gov. Tim Walz said.

"We've always said the gas tax is not an option. What they do in their plan is lower it 4 cents, which makes Minnesota the 6th highest state for gas tax so there's another area where we're top 10 for taxes," Senate Republican Majority Leader Paul Gazelka said.

Gazelka has said that, realistically, both sides will have to come to agreements by Wednesday at noon – that's in less than 48 hours to give everyone a chance to read all the bills.

Gov. Walz was asked earlier if they were going to reach an agreement Monday night, and he said that is optimistic.