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Jessica Reilly
Jessica Reilly

Special session’s to-do list grows after vetoes

Those looking to sneak their pet issue somewhere into the 2015 special session might be wise to start making plans for next spring. The must-do agenda for this year grew yet again over the weekend as Gov. Mark Dayton vetoed two more contentious budget bills, rejecting one bill on jobs and economic development and another on environment and agriculture.

The vetoes came just days after Dayton officially spiked an education funding package he declared insufficient. Also on the radar for the special session, based on the final night of the regular term, are a Legacy Amendment bill that passed the House but not the Senate, and a capital investment bill that met the same fate, only reversed.

Consider that optimists are still pining for some kind of last-minute deal on transportation or taxes, and the potential workload for the upcoming special session looks not unlike the agenda for the whole of the 2015 session.

The pair of vetoes issued on Saturday add a thicket of complications to pre-session negotiations, which began Tuesday as Dayton met with House Speaker Kurt Daudt. On education, the two sides were a mere $25 million apart, and they nearly closed the gap in the final hours of the session.

Dayton’s initial schedule for the day, meeting with Daudt and leaving the Senate conspicuously absent, suggested that the major sticking points were still between the administration and the House majority. The governor subsequently added a follow-up meeting with Senate Majority Leader Tom Bakk and Sen. Richard Cohen, DFL-St. Paul, whom he briefed on his progress with Daudt.

“It’s important to make sure that some of the interests of the Senate are represented,” said Cohen, speaking before the Tuesday afternoon meeting. “Though we tend to be aligned with the governor on most things, it’s still an important voice.”

Progress out of Tuesday’s fairly brief meeting was apparently minimal, as Dayton, Lt. Gov. Tina Smith and Daudt made plans to renew negotiations the following day.

Rep. Pat Garofalo, R-Farmington, chief author of the now-vetoed jobs bill, sees the governing breakdown differently than most. The problem is not one between Republicans and Democrats, Garofalo says, but between urban and rural Democrats, many of whom voted in favor of the jobs, education and environment bills.

“[Republicans] reached agreement with rural DFLers,” Garofalo said. “Metro DFLers were upset, and the governor chose to address their concerns by vetoing some bills.”

He added: “Like the state of Minnesota, [Republicans] are just along for the ride.”

For both the jobs and environment packages, Dayton provided a litany of unacceptable policy and funding choices agreed to by both the House and Senate. The economic development bill “omits adequate funding” for the Department of Commerce, according to Dayton’s letter, which then names a dozen necessary functions that didn’t receive money.

Dayton’s veto of House File 1437, the energy and jobs legislation, says the bill’s money for broadband infrastructure — due for a one-time, $10.6 million pool of money in fiscal year 2017 — is “seriously inadequate” and that its changes to existing net metering laws will “disincentivize the use of wind and solar power.” The bill would have allowed co-op or municipal electrical suppliers to charge “reasonable and appropriate” fees for fixed-cost expenses to customers who generate their own renewable energy.

Garofalo argued that most of the legislative opposition to the changes in net metering came from metro-area liberals, whose constituents almost exclusively use investor-owned utilities like Xcel Energy, while rural Democrats supported the change.

The bill also does not fund six full-time equivalent (FTE) positions needed to evaluate health insurance rates within MNsure and in the private marketplace. Those jobs had previously been subsidized through funding from the Affordable Care Act, aka Obamacare, but become the state’s responsibility July 1. Dayton also lamented the low totals provided to the Commerce Department’s fraud bureau, its energy regulation and planning division and its administrative services division.

Garofalo declined to wade into some of the details of Dayton’s rejection of line items. But, speaking to how its final shape came to be, he made the point that the bill was not a conference committee report but a delete-all amendment that originated in the Senate. Just hours before the session ended, Garofalo submitted his priorities to the Sen. David Tomassoni, DFL-Chisholm, for inclusion in the final bill, and had no choice but to adopt the language that arrived after passage in the Senate.

“That’s the way this was constructed,” Garofalo said. “If you listen to the Senate debate on the bill, Senator Tomassoni said the deal was a third [for the Senate], a third [for the House], a third [for the administration]. And that’s where my comments will end.”

House Democrats had called for Dayton to veto that bill over the way it was passed, as Republicans forced the bill through in the session’s closing moments, but Dayton did not mention the controversial process in his veto letter.

The governor’s issues with the agriculture omnibus have less to do with funding and more with policy, as Dayton wrote that the bill “undermines decades of environmental protections.” Among problem areas cited in the veto letter:

  • A required lengthening of Minnesota Pollution Control Agency (MPCA) rulemaking on water quality standards, and an 18-24 month window of their implementation.
  • Amnesty for businesses or other regulated entities that self-report environmental violations.
  • Elimination of the MPCA’s citizens board.

Several House Democrats were quick to back Dayton’s use of the veto pen, while the DFL Senate majority, which agreed in whole or part to each of the rejected bills, stayed quiet over the weekend.

House Republicans, meanwhile, took exception to Dayton’s letters, and said any failure to reach satisfactory compromise rests with the administration. Rep. Denny McNamara, R-Hastings, lead author of the environment and agriculture bill, said the governor’s office had given no firm indication that he would veto the legislation if it passed in its final form.

“It seems the governor’s version of compromise is his way or the highway,” McNamara said, in a statement issued Saturday. “Moving forward from this veto, which blindsided us, will be difficult.”

Cohen, speaking Tuesday, said he was not surprised to see the governor veto the environment bill, which had been opposed by “almost the entire DFL caucus” during the Senate floor vote.

“There’s some strong feelings there,” Cohen said. “On the jobs bill, it’s a little different, and there’s no question that the governor’s priorities in that bill tend to be around smaller amounts of money — with some good reasons on his part.”

Daudt said Dayton’s vetoes come in spite of overtures from the Legislature, saying lawmakers had “made every effort to accommodate his requests,” but to no avail.

“While the Senate and House completed [our work] on time and in a bipartisan fashion, the governor wants more time,” Daudt said.

It was Republicans who were “insistent” that the final budget leave a flat $1 billion on the bottom line, according to Cohen, though, he observed, they “blew past” that figure with their final education bill offer to Dayton. That flexibility could portend well for striking a new deal in the coming days and weeks.

“I would hope that, on the dollars, it’s not going to be that difficult,” Cohen said.

Dayton did opt to sign the state government finance bill on Saturday, meaning that budget is safe, as is the health and human services sector and the state’s judiciary branch and public safety systems.

The governor has said he will not call a special session until leaders of all four caucuses can agree on a limited, bare-bones agenda.

sday afternoon. The governor has said he will not call a special session until leaders of all four caucuses can agree on a limited, bare-bones agenda.

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