Almanac: At the Capitol

Today in addressing the Minnesota Chamber of Commerce, Gov. Tim Pawlenty told lawmakers after getting out of a $4 billion surplus:

"You don't celebrate getting out of Weight Watchers by going to the all you can eat buffet. My message to lawmakers is push away from the table. Put down the fork."

Sen. Tarryl Clark responded that some people may be offended by the governor's analogy. You can hear more of her reaction as I host Senate leaders live tonight on Almanac: At the Capitol. But this quote from the governor marks the end of his Mr. Nice Guy to the legislature. Lawmakers are viewing it as fighting words. The tax debate is now the central question at the Capitol. What taxes are on or off the table, what taxes will end up in bills, what taxes the governor will veto are the buzz in the building.

First there was the 2 months of thumb twiddling.

Then came the week of spinning the forecast numbers. Is there a surplus, or not? Pogie says no, Seifert says yes. The Governor says "can't we all get along? — Let's just pass MY budget."

Now the real work of the session has begun, and if you are following the budget you know that keeping up is like drinking from a fire hose.

So, to help you out, let me first give you a sense of what the tax proposals look like, courtesy of a friend I have over at the House:

Income Taxes on Working Minnesotans

• Rep. Mindy Greiling (D-Roseville) wants to raise income taxes by $252 million. (House File 1738)
• Rep. Ann Lenczewski (D-Bloomington) wants to raise income taxes on 170,000 taxpayers. She added this tax increase with an amendment to House File 1258. It would collect millions more in income taxes.

Sales Taxes on Consumers

• Rep. Melissa Hortman (D-Brooklyn Park) wants to impose an extra sales tax to pay for transit and other purposes. In the Metro area, there would be one tax increase. In the rest of the state, the new tax could be proposed by any two or more county boards. (House File 1463)
• Rep. Rick Hansen (D-South St. Paul) would impose an extra sales tax to raise at least $500 million a year to pay for new parks, trails, and habitat projects. (House File 1449)
• Rep. Shelley Madore (D-Apple Valley) wants to impose an extra sales tax on the three million people in the metro area to pay for more buses and trolleys. (House File 1112).

Tax the Dead, the Drivers, the Homeowners, and the Paint on Their Homes

• Rep. Tom Anzelc (D-International Falls) wants to authorize a new tax on dead people in his area to pay for the Lakeview Cemetery Association. (House File 213).
  
• Rep. Bernie Lieder (D-Crookston) wants to triple a tax on hearses. (House File 946)
• Rep. Ken Tschumper (D-La Crescent) wants to raise fuel taxes by 50 percent on gasoline, E85, M85, liquefied petroleum gas, propane, liquefied natural gas, and compressed natural gas. (House File 1469).
• Rep. Bernie Lieder (D-Crookston) wants to raise your gas taxes by 50 percent, and allow counties to charge you a wheelage tax, and triple the tax on cars and hearses, and allow counties to raise the sales tax, and put a transportation-impact tax on every building permit, and raise the cost to register vehicles. (House File 946)
  
• Homeowners would face a 50 percent increase when filing any papers related to the purchase, transfer, mortgaging, sale, or other transfer of property. Money from those taxes on homeowners would be given to non-homeowners seeking to rent property or buy their own homes. Rep. Scott Kranz (D-Blaine) wrote House File 939.
  
• Rep. Melissa Hortman (D-Brooklyn Park) wants to collect more taxes on local deeds and mortgage documents in Anoka County. (House File 362)
  
• Rep. Erin Murphy (D-St. Paul) wants to collect more taxes on local deeds and mortgage documents in Hennepin and Ramsey Counties. (House File 1042)
  
• Rep. Joe Atkins (D-Inver Grove Heights) wants to collect more taxes on local deeds and mortgage documents in Dakota County. (House File 1466)

Taxing Alcohol and Cosmetic Surgery

• Rep. Phyllis Kahn (D-Minneapolis) wants to tax cosmetic surgery. This would be a bad precedent for the sales tax, which generally has applied only to goods (except for food, clothing, and a few other exceptions). (House File 1027)
  
• Rep. Michael Paymar (D-St. Paul) wants to pile enormous tax increases on beverages containing alcohol. He would raise taxes on metric sales beverages by the following percentages: distilled spirits (up 228%); wine (up 450%); hard cider (up 800%); regular beer (up 790%); and 3.2% beer (up 457%). (House File 1050) It would collect over $110 million in new taxes.
• Rep. Karen Clark (D-Minneapolis) is seeking similar increases in taxes on alcohol, but for other purposes. (House File 1446)

Taxes on Doting Friends and Relatives

• Rep. Joe Mullery (D-Minneapolis) wants to put a 10% tax on people who give gifts. If the donor does not pay the tax, then the tax liability shifts to the person who received the gift. In such cases, the donor would still be liable for a $100 penalty for not paying the gift tax. Under the bill, you could be required to show the gift to the Commissioner of Revenue to determine its true worth. (House File 1212)

"Reach Out and Touch Someone" with Taxes

• Rep. Debra Hilstrom (D-Brooklyn Center) wants to raise a tax on cell phones, land-line phones, and other telecommunications devices by 46%. (House File 1464)

"Giving" Begins at Home

• Rep. Frank Moe (D-Bemidji) wants to raise local sales and use taxes in Bemidji. (House File 1103)
• Rep. Bernie Lieder (D-Crookston) wants to raise local sales and use taxes in Crookston. (House File 1820)
  
• Rep. Will Morgan (D-Burnsville) wants to create special tax increment financing districts in Burnsville. These districts often shift property tax burdens onto current landowners for years. (House File 1054)
  
• Rep. Carolyn Laine (D-Columbia Heights) wants to create a special tax increment financing district in Columbia Heights. (House File 1879)
  
• Rep. Terry Morrow (D-St. Peter) wants a new local sales tax authorized for North Mankato. (House File 108)
  
• Rep. Bill Hilty (D-Finlayson) wants a new local sales tax authorized for Cloquet. (House File 885)
  
• Rep. Mike Jaros (D-Duluth) to raise taxes on food and beverages in Duluth to help to pay for a new hockey arena in that city. (House File 134)

Fee Increases Ahead

Democrats campaigned against fee increases last fall. But now, they are introducing bills with lots of fees. Some of the tax increases described above are called "fee increases" in part or in whole (phone fees, alcohol fees, health impact fees). Then there are these bills:

• Rep. Larry Haws (D-St. Cloud) wants to raise fees for county and regional jails. (House File 161)
  
• Rep. Brita Sailer (D-Park Rapids) wants to raise fees on video and electronic equipment sales. (House File 854)
  
• Rep. Joe Atkins (D-Inver Grove Heights) wants to impose an extra $250 fee on cigarette manufacturers. (House File 1737)
  
• Rep. Erin Murphy (D-St. Paul) wants to raise pharmacy fees automatically on an annual basis. (House File 1722)

It's hard to believe that anyone could suggest that liberals like taxing and spending, given that these various increases add up to only $2.5 billion according to the Star Tribune.

What's $2.5 billion between friends? Combined with the $2 billion + in surplus dollars, that would total less than a $5 billion increase in spending over a biennium! Peanuts.

The simple fact is that government is a very blunt instrument. Pretty much all it can do is create big bureaucracies, spend a lot of money, and regulate in very rough ways.

If anyone has any hope still about the ability of legislatures to craft complex, well-thought-out public policy measures, go down to the legislature over the next few weeks and watch how the process really works. You will see 201 people, all with different ideas and opinions, different agendas, and different personalities fighting like hell to get their agenda passed.

Out of that process a few omnibus bills are passed, that actually mean less than it seems, because when all is said and done, the real decisions are made between the leaders of the House, the Senate, and the Governor in late night negotiations filled with acrimony, brinksmanship, and high politics. Complex policy questions are pretty much last on the agenda in these meetings.

So, the one thing you can be sure of when all is said and done is that government will be bigger, cost a lot more, and still leave us with plenty of "crises" to solve next year.

Personally I am beginning to think that one of the worse things to happen over the last few years is the TV Reporter's exposure of drinking at the capitol. At least when the legislators were well lubricated we had a chance to escape their attention. Now that they are wholly lucid, who knows what they will come up with?

For the second time in two weeks the House DFL does a big press conference without the right numbers in its press release. Last week, Rep. Mindy Greiling announced an income tax increase on the top tier. The top tier was wrong in the press materials, it was off by about $20,000. An even bigger error was the amount of money the income tax would raise was underestimated by about $200,000,000. Now today Rep. Paul Marquart released a report on property tax increases and the numbers were off again by about $5,000,000. I don't mean to be cruel, but our job is to get correct information out to the people and that's hard to do when we don't have the right numbers. They should be double and tripled checked before the press conference, not after it. For equal opportunity here, I'm even more frustrated with the governor's office, not for getting numbers wrong, but for not even having the courtesy to respond to our inquiries. Last week when Gov. Pawlenty was in Iraq apparently every television station in town was offered one on one satellite interviews, every TV station but us, the TV station that covers the governor and politics and government more consistently than other TV stations. Now, I don't know why or how the governor's office made those decisions because they haven't even responded to my questions. It is an ongoing issue many in the media have with the governor's office — our phone calls and emails simply go unanswered. That is not good public relations.