Highlights

Sen. Keith Langseth (DFL-Glyndon), chief author, said S.F. 2 reauthorizes the more than $350 million in capital investment projects vetoed last year by then-Gov. Jesse Ventura. The measure also includes, he said, projects not authorized by the Legislature last year, including acquisition of land for the Minneapolis Community and Technical College, money to match federal funds for the Paul and Sheila Wellstone Center for Community Building and flood-related items for Northern Minnesota. Times of recession, of economic downturns, are the right times to bond and build, Langseth said. The state will get the most for its money now and will help put workers on jobs, he said.

The measure includes $48.3 million for the University of Minnesota, $69.7 million for the Minnesota State Colleges and Universities (MnSCU), $25.7 million for the Dept. of Children, Families and Learning, $35.3 million for natural resources projects, $3.6 million for the Office of Environmental Assistance and $8.25 million for the Board of Water and Soil Resources (BOWSR). The proposal also provides $292,000 for agriculture projects, $8.2 million to the Minnesota Zoo, almost $5 million to the Dept. of Administration, $8.25 million to the Amateur Sports Commission and $32 million for arts projects. Transportation projects are budgeted for $57.5 million, military projects receive $500,000, the Metropolitan Council is appropriated $10.5 million and the Minnesota Historical Society receives $725,000. The bill provides $775,000 for the Dept. of Health, $6.7 million for the Dept. of Human Services, $1.5 million for the Dept. of Corrections, $68.7 million for trade and economic development and $1.5 million for the Iron Range Resources and Rehabilitation Board.

Several members, including Sen. Linda Higgins (DFL-Mpls.), spoke in support of the bill and expressed their disappointment at the vetoes of items last year. "I, for one, was screaming, raging mad when those projects were vetoed," she said. We should all be for jobs, Higgins said, and this bill is about jobs.

However, some Senators raised concerns about the size of the package and the state's ability to afford all of the items in the bill. Sen. Warren Limmer (R-Maple Grove) said the bill needs to be tweaked and reduced in size. For some of the projects, said Sen. Claire Robling (R-Jordan), the state will not have the funds to manage the on-going operating costs. She noted that the bill includes money for new trails, while natural resources officials are talking about closing some existing trails to keep others operating.

Limmer also said that the proposal is not an effective stimulus on the economy. Most bonding projects take about 18 months from authorization to actual work on the project, he said. The bill is not about jobs, Limmer said, but about expanding the role of government. The proposal does not address the real economic questions, such as the state business climate and competitive tax rates, he said. Minnesota cannot spend its way out of an economic downturn, he said, and cannot use special spending bills or special tax programs to solve the underlying issue.

However, Langseth said many of the projects are ready to go and only need the state money to start work. Sen. Dean Johnson (DFL-Willmar) said the proposal should not be framed as state spending, but as investment in the state's infrastructure. "The best time to build and reconstruct our infrastructure is right now," he said, because of historically low interest rates. The private sector will benefit from the bill, he said, because contractors and their employees will be getting the construction contracts. While the proposal will not solve the economy's problems, it is one small effort the state can make, Johnson said.

Sen. Steve Kelley (DFL-Hopkins) said that employers have said they value Minnesota's quality of life, the quality of the state's workforce and the quality education provided to Minnesotans. The bill moves the state forward in those areas, he said, by providing funding for higher education, including an appropriation for a translational research facility at the University of Minnesota.

The state should bond for certain infrastructure items, said Sen. Michael Jungbauer (R-East Bethel). However, he said, the bill includes as many unnecessary projects as vital, important projects. Sen. Sean Nienow (R-Cambridge) said there is no better time for the state to be bonding for projects. But, he said, the state does not need to be spending $4.25 million to renovate the governor's residence right now.

Members considered two amendments to the bill. Sen. Mady Reiter (R-Shoreview) offered an amendment requiring the commissioner of transportation to enter into an agreement with the Burlington Northern Santa Fe Railroad regarding the total amount of money to be paid to the railroad for the use of its tracks, equipment and other property. The amendment prevents $10 million appropriated for the Northstar Commuter Rail project from being available until the agreement has been reached. Sen. Dave Kleis (R-St. Cloud) spoke against the amendment, saying it will delay the project. He said there is no way to know how much the Northstar project will cost until state money is available to leverage federal funds that are in danger of being lost to other states. The amendment was defeated on a 9-53 roll call vote.

Kleis offered an amendment to the bill reducing the size of the package to $147.7 million. The amendment includes $69.7 million for MnSCU, $4 million for natural resources projects, $8.25 million for BOWSR items, $500,000 for military projects, $46 million for transportation and $19.25 million for trade and economic development. Kleis said the amendment was an attempt to move something forward in a year when the other body and governor have indicated an unwillingness to bond. However, Sen. Richard Cohen (DFL-St. Paul) said the governor has indicated his support for the translational research facility at the University, but the project is not included in the amendment. He said the amendment does not meet the expectations of the governor and is insufficient. The amendment was defeated, 23-43.

The bill is overly large for an off-year, said Sen. Dick Day (R-Owatonna), and is huge for what is being called an emergency bill. "Anybody knowledgeable will tell you that it will be at least a year from now before these projects will be on the drawing board," he said. Day said that about $600 million in state bond funds authorized in previous years will be spent on construction this year. The bill has more pork, he said, than any he has seen in his career as a Senator. The bill should be smaller and more focused, Day said. However, Langseth said the bill was balanced between Greater Minnesota and the Metro Area when it was approved by both bodies last year. The bill represents the completion of a bipartisan effort to invest in Minnesota, he said.

The bill was defeated, 35-31. Pursuant to Article XI, section 5 of the Constitution, bonding bills must gain the support of at least three-fifths of members of each body, or 41 Senators, to be granted final passage.

Members recessed to prepare for a lengthy debate on a bill providing for a uniform handgun permit process. Prior to the recess, Sen. Steve Murphy (DFL-Red Wing) outlined the provisions of S.F. 369. The bill requires training before a permit is issued, sets forth an appeal process for the denial of a handgun permit and provides for data collection on how many applications are received and how many are denied. Murphy said the bill is easy to understand and is a very common sense approach to the handgun permit process.

Upon returning from the recess, Sen. Jane Ranum (DFL-Mpls.) began the discussion and said, "I support the approach taken in the bill. If the Senate passes the radical bill passed by the House, it will be moving in the wrong direction. I am strongly opposed to the original conceal carry legislation." Ranum then offered an amendment containing the language passed by the other body. "I want the people of Minnesota to know what is in this bill," Ranum said, "I want to make sure Minnesotans know what is at stake." Murphy opposed the amendment, "I think the bill I have is a reasonable way to provide permits to people who have a legitimate reason to have one." Sen. Pat Pariseau (R-Farmington) moved to lay the bill on the table. The motion, which was nondebatable, was adopted on a 37-28 roll call vote.

Johnson promoted to Brig. Gen.
Senators gathered in the Senate Chamber Wed., Apr. 23, to recognize the achievements of one of their own in his outside life. Sen. Dean Johnson (DFL-Willmar) was formally promoted to the rank of brigadier general. Johnson serves as the Army National Guard Special Assistant to the Army Chief of Chaplains. Gov. Tim Pawlenty, Senate Majority Leader John Hottinger (DFL-St. Peter) and Adjutant General Eugene Andreotti offered brief remarks on Johnson's service and congratulating him. Hottinger noted an inscription above the Senate door reading "the noblest motive is the public good." Johnson, he said, passes the true test of that statement for Legislators, when one acts for the public good outside the Senate Chamber.

Johnson thanked those who have supported him in the many duties of his life-as a Legislator, as a National Guard chaplain, as pastor of Calvary Lutheran Church in Willmar and as a husband and father. He said his father taught him to get the job done, without asking what the obstacles and challenges were. His late mother, Johnson said, always sought peace, prayed daily and deeply respected those in uniform. Avonelle, his wife, "is the most courageous person I've ever met in my entire life," he said. She has taught him, Johnson said, that every child has the potential to learn and that one should be loyal to friends and family in all circumstances. "I see the challenges and responsibilities that we who are chaplains in the military have," he said, to respect the free exercise of religion by service members, to bring comfort to service members and their families and to represent American citizens to the best of their ability.

Silver eagle pins, designating Johnson as a colonel, were removed from his shoulders by Andreotti and Pawlenty and replaced with single-star pins by his wife and a friend, Duaine Amundson. Andreotti also presented Johnson with a fringed flag, red with one star in the center, for display in his office.

Higher education funding bill passed
Senators devoted the entire Wed., Apr. 23, floor session to discussion of the omnibus higher education appropriations bill. S.F. 1511, carried by Sen. Sandra Pappas (DFL-St. Paul), appropriates $2.7 billion to fund post-secondary education institutions and grants for students. Specifically, the measure appropriates $1.2 billion to the University of Minnesota, $1.192 billion to the Minnesota State Colleges and Universities, $2.78 million to the Mayo Medical Foundation and $310 million to the Higher Education Services Office.

Pappas said the measure cuts 8 percent from the MnSCU system and the University of Minnesota, rather than the 15 percent proposed by the governor. She emphasized that the cuts were to the institutions' base budgets and not cuts to spending increases. Pappas also said one of the primary goals in developing the bill was to preserve a core commitment to student choice. "We maintain the University's ability to continue its role as an economic engine for the state," Pappas said. She also said, "Hopefully, the bill will hold down tuition increases at MnSCU to under 10 percent and at the University to under 15 percent." The bill provides funding for state grants at the 2003 base level, Pappas said.

Members adopted two amendments, offered by Pappas, clarifying language in the measure. Sen. Dave Kleis (R-St. Cloud) offered an amendment to cap tuition increases at 9 percent. Kleis said, "The governor wanted to make sure there is a cap on tuition increases so that all the increased costs are not passed on to students." He added, "My concern is that even though the bill provides more money to the institutions, there will be double digit tuition increases. My fear is that the institutions will not see this as an opportunity to reform and do things more efficiently, but will just pass the burden along to students."

Pappas countered, "I know it is really tempting, but we have a long-term policy of having decentralized decisions at the local campus level. There are some institutions that really believe in quality and have expensive programs."

Sen. Thomas Neuville (R-Northfield) offered an amendment to the amendment and said, "I think the amendment is reasonable, but there is piece that is left out. I think we have to expect the institutions to control their expenses. The amendment to the amendment requires MnSCU, and requests the University, to freeze salaries in the aggregate." He added that the amendment was not an effort to be critical of employees at MnSCU or the University, just an economic reality.

Pappas opposed the amendment and said, "We are in a difficult financial situation, but we need to trust college presidents to manage individual campuses. This kind of broad brush does not work." Sen. Steve Kelley (DFL-Hopkins) also opposed the amendment. "It doesn't save money and might actually set a floor for salaries," Kelley said.

The amendment to the amendment failed on a 28-36 roll call vote. The Kleis amendment was defeated on a 29-35 roll call vote.

Sen. Cal Larson (R-Fergus Falls) offered an amendment specifying that if a student enrolled in a post-secondary institution is convicted of damage to property or violence to persons in connection with a riot, the student loses eligibility for state grants and must pay the highest applicable tuition rate. The amendment was adopted on a 57-6 roll call vote.

In closing comments on the bill, Sen. Claire Robling (R-Jordan) said that during the course of putting the bill together in division, there was a lot of effort to try and ease the hardship of the cuts. However, Robling said she was disappointed that the bill fails to increase the appropriation for state grants. "Student choice is diminished, especially for those who would choose private schools," Robling said.

Pappas responded, "This is only the first of several very difficult budget bills. The Senate proposal is a balanced approach. Having good quality institutions also serves the students."

The bill was given final passage on a 34-31 roll call vote.

Editors' note
Friday committee hearings are not included in this week's issue. Look for updates on the committees in next week's Senate Briefly or on the web site under daily updates.

Committee update

E-12 Education Budget Division
Two bills approved
A bill requiring owners and operators of multistation or private branch exchange (PBX) multiline telephone systems to provide call back numbers and emergency response locations was approved by members of the E-12 Education Budget Division, Tues., Apr. 22. The panel, chaired by Sen. LeRoy Stumpf (DFL-Thief River Falls), also considered two other measures.

S.F. 653, sponsored by Sen. Dallas Sams (DFL-Staples), was before the division because it authorizes school districts to use revenue from the safe schools levy to cover the costs of updating their phone systems. Under the bill, owners of multiline systems must comply by 2007. Fiscal Analyst Eric Nauman said that for districts to meet the deadline, they may need to levy in FY 2005 to pay for the upgrade. However, he said, if districts are already at the cap, then no additional revenue is available. Of the state's 343 school districts, 311 are at the limit for the safe schools levy, said Bob Meeks of the Minnesota School Boards Association. Members adopted two amendments, offered by Sen. Steve Kelley (DFL-Hopkins), to clarify the effective date of 2007 and to clarify that the existing safe schools levy authority includes upgrading phone systems for public safety purposes. S.F. 653 was advanced to the Finance Committee.

Sen. Satveer Chaudhary (DFL-Fridley) authored S.F. 1346, which was also approved and advanced to the Finance Committee. The measure creates an alternative to the detachment and annexation process for residential property parcels that are split among school districts. After some discussion of possible consequences of the measure, members adopted an amendment-also offered by Kelley-limiting the bill's scope to property located in the city of Fridley and split between ISD #13, Columbia Heights, and ISD #14, Fridley. Chaudhary sponsored the bill to address the concerns of property owners in his district that are split between the two school districts.

Members also considered S.F. 1409, carried by Stumpf. The bill appropriates $50,000 each year in FY 04-05 for a grant to ISD #690, Warroad, to operate the Angle Inlet School. The measure was recommended for possible inclusion in the division's omnibus appropriations bill.

Omnibus bill articles reviewed
Members of the E-12 Education Budget Division began their consideration of the omnibus education appropriations bill, Wed., Apr. 23. Panel members, chaired by Sen. LeRoy Stumpf (DFL-Thief River Falls), took no action on the measure.

The proposal consists of 12 articles, relating to various areas of education funding and policy. The bill includes provisions for general education, educational excellence, special programs, education reform, nutrition programs, libraries, family and early childhood education, prevention, self-sufficiency and lifelong learning, state agency operations and grants and administrative and technical provisions.

Omnibus bill approved
Members of the E-12 Education Budget Division, chaired by Sen. LeRoy Stumpf (DFL-Thief River Falls), met Thurs., Apr. 24, to complete work on the division's omnibus bill. The panel approved a $12.5 billion funding package for E-12 education. Under the measure, $9.991 billion is appropriated for general education programs and $1.775 billion is appropriated for categorical aid programs.

The measure is $90 million more than the governor proposed and does not cut as deeply into programs for literacy and other academic programs beyond the classroom, Stumpf said. The bill also includes appropriations for on-line learning and for family and early childhood education that are more than the governor's recommendations.

The proposal also contains the repeal of the Profile of Learning and provides for a new set of standards. An attempt to remove the provision containing the new standards failed to be adopted. The measure was advanced to the full Finance Committee.

Environment, Agriculture and Economic Development Budget Division
ATV bill debate continues
A bill restricting ATV use was the focal point for the Tues., Apr. 22, meeting of the Environment, Agriculture and Economic Development Budget Division.

S.F. 850, authored by Sen. John Marty (DFL-Roseville), provides for about 1,500 miles in new trails in addition to existing trails and increases the fee $10 per year for ATVs. "I think the bill is a reasonable compromise," Marty said.

Laurie Martinson, Dept. of Natural Resources, said the department had concerns about the implementation because of the timing on licenses. She said the licenses are for a three year period, but that a phased in implementation period of one third of all ATVs each year diminished the department's concern somewhat.

The panel, chaired by Sen. Dallas Sams (DFL-Staples), considered an amendment, offered by Sen. Thomas Bakk (DFL-Cook), making substantial changes in the fiscal portions of the bill. Bakk said that he has been critical of the governor for using fee increases and that the bill raises $3.5 million in new fees. Bakk said "In a time when local governments are laying off employees, the bill adds new FTEs for the department. How can we square that with cuts to fire departments and nursing homes?" Marty responded that he was also concerned about cuts to local units of government, but that counties have costs associated with repairing damage costs by ATVs. The amendment failed, but no action was taken on the bill.

JOBZ bill approved
The governor's initiative for tax-free economic development zones cleared a hurdle Wed., Apr. 23, as members of the Environment, Agriculture and Economic Development Budget Division approved the measure and advanced it to the Finance Committee.

S.F. 496, sponsored by Sen. Thomas Bakk (DFL-Cook), provides tax incentives for property located and income generated in a job opportunity building zone (JOBZ). The bill permits the commissioner of trade and economic development to designate ten JOBZ zones, as well as five additional agricultural processing facility JOBZ zones and five additional mineral processing facility JOBZ zones. Zones may be no more than 5,000 acres in size, with noncontiguous land. Under the bill, zones may not be located in the Metropolitan Area, nor can JOBZ zones include areas within border city development zones. JOBZ zones are limited to 12 years in duration, though the measure permits zones to be authorized for shorter time periods.

The measure provides that businesses that relocate from outside a zone to within the zone do not qualify for zone benefits unless the businesses increase full-time employment by at least 20 percent within the first year of operation, or make capital investments in the zone property of at least 10 percent of the previous year's gross revenues. Retail businesses, under the measure, do not qualify for zone benefits. The tax incentives provided in the measure are for zone businesses and investors in zone businesses. The benefits include exemptions from the individual income tax, corporate franchise tax, sales and use tax, motor vehicle tax, property tax and wind-energy production tax. The bill also provides for a tax credit for wages paid over $30,000 for each net new employee. If a company ceases operations in the zone, it is obliged to repay its tax obligations during the two years prior to the ceasing of operations, under the bill. S.F. 496 also includes reporting requirements for the commissioner of revenue to determine the amount of revenue foregone from zone designation.

Louis Jambois, Dept. of Trade and Economic Development, said the plan was inspired by similar initiatives in other states. However, he said, the department examined the plans in the other states and developed improvements, including the reporting requirements and the two-year repayment obligation. Giamboi also said the requirements placed on businesses that relocate into a zone to receive JOBZ benefits are "pretty high bars" that will discourage the practice of poaching.

Sen. Julie Rosen (R-Fairmont) said she has listened to those who believe the proposal creates winners and losers across Minnesota. Greater Minnesota, Rosen said, has been losing for a long time. The Metro Area will grow regardless of the JOBZ initiative, she said. The program creates a competitive atmosphere and requires communities to talk and plan together for business development, Rosen said. Too many communities, Bakk said, in Greater Minnesota count retirees as half or more of their population. The bill encourages business development and provides incentives for younger residents to stay or move to Greater Minnesota, he said. "I don't know if this approach is going to work at rebuilding Greater Minnesota's economy," Bakk said, "but it is certainly worth a try." The bill is not a magic bullet, he said, but is one more tool in the economic development toolbox.

However, Sen. Michele Bachmann (R-Stillwater) said the devastation being seen in parts of Minnesota's agricultural community can be traced to the national government's intervention, as far back as the 1930s. The prescription of more government intervention, she said, will not bring about Greater Minnesota's revitalization.

In other action, the panel, chaired by Sen. Dallas Sams (DFL-Staples), considered S.F. 419. Discussion centered on a tentative agreement reached between the Pollution Control Agency, League of Minnesota Cities, Coalition of Greater Minnesota Cities and Minnesota Farm Bureau Federation. Steve Nyhus, representing the Coalition of Greater Minnesota Cities, said the agreement corrects defects in existing rules related to identifying impaired waters under the federal Clean Water Act. However, Janette Brimmer of the Minnesota Center for Environmental Advocacy, said that while current rules are not perfect, they have gone through the full, contested rulemaking process and all parties should accept the rules. She said the agreement also goes beyond the identification of impaired waters and imposes limits on permitting. The bill, carried by Sams, was laid aside for further consideration.

Division members also approved S.F. 97 and advanced the bill to the Finance Committee. Authored by Sen. Gary Kubly (DFL-Granite Falls), the measure restores funding for the West Central Growth Alliance that was unallotted by the governor earlier this year. Two measures were laid over for possible inclusion in the omnibus appropriations bill. S.F. 1509, sponsored by Sen. Scott Dibble (DFL-Mpls.) restores funding to the Bridges rental housing assistance program. S.F. 1489, carried by Sen. Linda Higgins (DFL-Mpls.), appropriates money to the board of water and soil resources for local water planning grants.

Omnibus bill advanced
The Environment, Agriculture and Economic Development Budget Division met Thurs., Apr. 24, to complete work on the division's omnibus appropriations proposal. Sen. Dallas Sams (DFL-Staples) explained the $1.14 billion in general and statutory funding for environment, natural resources and agriculture programs and the $294 million economic development funding package to members. Sams said the division's proposal is $32 million over the governor's proposal in the area of environment and natural resources and $44 million over the governor's proposal in the economic development area. The measure restores cuts made by the governor to workforce development programs and several environmental programs. The proposal also maintains the Dept. of Trade and Economic Development and the Dept. of Economic Security as separate agencies.

The proposal contains funding for numerous bills heard by the division over the course of the session. In addition, several amendments were offered during the hearing.

Sen. Steve Dille (R-Dassel) offered an amendment to alter the funding for the displaced homemaker program. Under the proposal, the program is funding through an increase of $30 on marriage license fees. Dille proposed a $10 increase on regular marriage license fees, no change to the reduced marriage license fee for couples who have had premarital education, a $20 increase to the civil filing fee for dissolutions and the balance from the workforce development fund. Sen. Richard Cohen (DFL-St. Paul) argued against the amendment and said, "The concern I have is that two other budget divisions have been looking at increasing the civil filing fee and the judicial branch has objected strongly. Dille agreed to withdraw the amendment.

Members did adopt an amendment, offered by Sen. Pat Pariseau (R-Farmington), incorporating language providing for a stamp for dove hunting. Language providing for a season on mourning doves is contained in another bill that doesn't have a stamp, and the related fee, included.

Sen. Dennis Frederickson (R-New Ulm) offered an amendment to clarify the regulation of wastewater treatment systems and plumbing in state park and recreation area buildings. The amendment was adopted. Sen. Julie Rose (R-Fairmont) successfully offered an amendment providing that Natural Resource Officers have citation authority only and are not law enforcement officers.

Dille also offered, but withdrew, an amendment requiring recipients of ethanol subsidies to provide additional disclosure information to the Dept. of Agriculture. A third amendment, offered by Dille, requests the commissioner to work on a national level to increase dairy prices and to allow foreign individuals who are already engaged in dairy farming to continue farming. The amendment was adopted.

Sen. Steve Murphy (DFL-Red Wing) offered an amendment authorizing deputy registrars to increase the registration fee for boats, ATVs and off-road motorcycles from $2 to $4.50. The amendment was adopted. Sen. Ellen Anderson (DFL-St. Paul) successfully offered an amendment requiring the commissioners of the Dept. of Trade and Economic Development and the Dept. of Commerce to collect and analyze job loss data and the relationship between job losses and international trade agreements.

Members also discussed a policy provision in the economic development proposal concerning the fee schedule for medical services provided under workers compensation. The provision specifies that the fees must be the same for identical services regardless of the discipline of the health care provider performing the service.

The proposal was approved and advanced to the full Finance Committee.

Finance
Higher education budget approved
A budget bill appropriating over $2.7 billion in FY 04-05 for higher education was approved by members of the Finance Committee, Tues., Apr. 22. The measure is sponsored by Sen. Sandra Pappas (DFL-St. Paul), chair of the Higher Education Budget Division.

The bill, which has not been introduced, appropriates $310 million to the Higher Education Services Office, $1.192 billion to the Minnesota State Colleges and Universities, $1.199 billion to the University of Minnesota and $2.782 million to the Mayo Medical Foundation. Pappas said she deeply regrets bringing forward a bill that includes base cuts to the state's higher education institutions and does not expand the state's financial aid program. She said the bill does not provide for the expected growth in demand for the state grant program and returns MnSCU funding to its FY 01-02 level and U of M funding to its FY 00-01 level. The measure was approved.

Committee members, chaired by Sen. Richard Cohen (DFL-St. Paul), also took action on two resolutions, both carried by Cohen. The Senate budget resolution sets the maximum limits on general fund revenues and appropriations and designates the size of a cash flow account and a budget reserve. The resolution provides for, in FY 04-05, a revenue limit of over $29.692 billion and a spending limit of $29.333 billion, with no funds for a cash flow account and $530 million as a budget reserve. The budget resolution was approved and advanced to the Tax Committee.

The other resolution sets the targets for the appropriations bills. The limit for E-12 education is $12.045 billion, for higher education is $2.703 billion and for health, human services and corrections is $8.288 billion. The limit for the environment, agriculture and economic development budget bill is $705 million and for the transportation bill, $143 million. The resolution also caps the state government bill at $1.124 billion, the capital investment bill at $717 million and spending in the omnibus tax bill at $1.472 billion. The resolution was approved on a 9-6 roll call vote. Cohen explained that, procedurally, the resolution does not leave the committee.

Health, Human Services and Corrections Budget Division
Dental bill okayed
The Health, Human Services and Corrections Budget Division devoted the Tues., Apr. 22, meeting to considering bills for inclusion in the omnibus appropriations bill. In addition, the division, chaired by Sen. Linda Berglin (DFL-Mpls.), advanced three measures to the full Finance Committee.

S.F. 906, authored by Sen. Wesley Skoglund (DFL-Mpls.), provides for the collection of co-pays for sex offender treatment. Dr. Steve Huot, director of sex offender/chemical dependency services, said the co-pays, which would be on a sliding fee scale, are part of the natural consequences of the offender's behavior. In addition, Huot said the co-pays could also help motivate offenders to take the program seriously. The measure was approved and advanced to the full committee.

S.F. 972, authored by Sen. Thomas Neuville (R-Northfield), generated some debate. The measure aligns Minnesota law concerning child support with federal law. The measure incorporates a federal mandate requiring all applicants for drivers' licenses and hunting and fishing licenses to provide their Social Security numbers at the time of application. Neuville said that the state must comply with the mandate or risk losing about $350 million in TANF funds. Sen. Paul Koering (R-Fort Ripley) said he was concerned about the data privacy issues involved in requiring people to supply their Social Security numbers. Neuville said the bill does specify that an applicant's Social Security number cannot be displayed, encrypted or encoded on the driver's license. The measure was advanced to the full committee on a divided voice vote.

The panel also sent a bill relating to dental practice to the full committee. S.F. 357, authored by Sen. Becky Lourey (DFL-Kerrick), modifies dental practice provisions and authorizes dental hygienists or dental assistants to perform some restorative procedures. "The bill is an attempt to meet the demands of those who need dental services," Lourey said. She offered an amendment, which was adopted, removing provisions in the bill that involved appropriations. The measure establishes a class of license for faculty of a dental school that entitles the dentist to only practice within the school and only for purposes of instruction or research. In addition, the bill exempts retired dentists who are volunteers in a public health, community or tribal clinic from most continuing education requirements. Finally, the measure allows the Board of Dentistry to waive the clinical examination if an applicant has successfully completed Parts I and II of the National Boards.

Two measures were heard and approved for inclusion in the omnibus bill. S.F. 1411, authored by Berglin, allows Medical Assistance coverage for some over-the-counter medications. In addition, a proposal detailing reimbursement rates for special transportation services was approved for the omnibus bill.

The division also heard from representatives of the Dept. of Health and the Dept. of Human Services on the issue of duplicate licensing.

Omnibus bill proposals heard
Members of the Health, Human Services and Corrections Budget Division devoted the Wed., Apr. 23, hearing to considering proposals for inclusion in the division's omnibus appropriations bill.

The panel, chaired by Sen. Linda Berglin (DFL-Mpls.), approved three items, in the form of amendments, for inclusion in the bill. One proposal concerns prepaid Medical Assistance for seniors to help avoid premature placement in nursing homes. A second proposal provides for a surcharge on ICFMR facilities similar to the surcharge on nursing homes. The third measure relates to persons with mental health problems that are in the corrections systems.

Members also approved several bills for inclusion in the omnibus measure. S.F. 534, authored by Sen. John Hottinger (DFL-St. Peter), provides an appropriation from the TANF block grant fund to provide services to families who are participating in the supportive housing and managed care pilot program. S.F. 1382, authored by Sen. Sheila Kiscaden (IP-Rochester), establishes a surcharge on attorney license fees to be used for the public defender system. S.F. 1021, sponsored by Sen. Brian LeClair (R-Woodbury), authorizes a corrections facility to serve two, rather than three meals, per day on week-ends and holidays.

S.F. 1044, carried by Berglin, increases the surcharge imposed on criminal and traffic offenders to provide funding for the public defender system. In addition, the bill authorizes alternative placements for certain mentally ill offenders. Members laid the bill over for further discussion.

The division also advanced one bill to the full Finance Committee. S.F. 834, sponsored by Sen. Don Betzold (DFL-Fridley), sets liability limits for nonprofit corporations providing day training and habilitation services for adults with mental retardation and daytime development achievement center services for children with mental retardation and related conditions. The bill specifies that the liability limits are the same as the limits set for municipalities.

State Government Budget Division
Omnibus bill approved
Members of the State Government Budget Division met Tues., Apr. 22, to approve the panel's omnibus budget bill. The measure includes appropriations for various state agencies and criminal justice operations. The proposal, carried by Sen. Jane Ranum (DFL-Mpls.), division chair, was advanced to the Finance Committee.

The measure cuts the general fund budget for the Legislature by 10.2 percent, for the Governor's Office by 24 percent, for the Office of the State Auditor by 15 percent, for the Office of the Attorney General by 15.4 percent and for the Office of the Secretary of State by 13.5 percent. The budget of the Campaign Finance and Public Disclosure Board is trimmed by 2.2 percent and the budgets for the State Board of Investment and the Office of Administrative Hearings are not cut. The Office of Strategic and Long Range Planning has its budget cut by 26.3 percent and the Dept. of Administration budget is cut by 3.5 percent. The budgets for the Dept. of Finance and the Capitol Area Architectural and Planning Board are trimmed by 15 percent. The budget for the Dept. of Employee Relations is cut by 14.1 percent and the Dept. of Revenue budget is cut by 1.1 percent. In military-related areas, the Dept. of Military Affairs budget is cut by 1.5 percent and the Dept. of Veterans Affairs budget is cut by 5.9 percent, while the budgets for various veterans organizations are preserved whole. General fund spending for the Gambling Control Board is increased by 41.2 percent, while the Minnesota Racing Commission budget is cut 87.5 percent as the agency transitions to being fee supported. Total net general fund spending on state agency operations is decreased by 21.7 percent in the bill.

The bill cuts net criminal justice general fund spending by 7.7 percent. Appropriations to the Supreme Court and Court of Appeals are cut by 2 percent each, with a cut to the District Courts of 0.7 percent. General fund spending for operations within the Dept. of Public Safety-including the Bureau of Criminal Apprehension, the State Fire Marshal, the Office of Crime Victim Services and the Office of Alcohol and Gambling Enforcement-increases by 7.8 percent. The measure also restores funding for the Office of Crime Victim Ombudsman as a separate agency, with an $840,000 budget for FY 04-05.

The proposal reduces the budgets for the Board of Accountancy and the Board of Architecture, Engineering, Land Surveying, Landscape Architecture, Geoscience and Interior Design by 20 percent each. The bill increases the appropriation for the Board of Barber Examiners by 8.2 percent. Spending for the Public Utilities Commission is cut by 10 percent and the general fund budget for the Dept. of Commerce is cut by 6.9 percent. The budgets for the minority community councils are cut by about 5 percent each. Net total general fund spending in this area, classified as economic development, is decreased by 19.3 percent. The net total impact of the bill on general fund spending is a 14.7 percent decrease, for a general fund total of $1.124 billion in net spending.

Transportation Policy and Budget Division
Omnibus bill discussed
The highlight of the Tues., Apr. 22, meeting of the Transportation Policy and Budget Division was the presentation of the panel's omnibus transportation funding bill.

Division Chair Dean Johnson (DFL-Willmar) said the proposal contains a 5 cent per gallon gasoline tax and changes the formula for license tabs. The resulting revenue, Johnson said, is used to fund both highways and transit for Greater Minnesota and the Metropolitan Area. "I compliment the governor for putting a plan on the table. Our concern, though, was that in the out years, construction funds will fall below MnDOT recommendations. The funding proposal before us is a more balanced approach," Johnson said.

The $2.1 billion package provides $1.3 billion for trunk highways, $395 million for local and county highways and $445 million for transit, Johnson said. In addition, the measure allows the commissioner to spend up to $250 million on trunk highway improvements approved by the federal government and designated as advance construction funds.

The measure increases the gasoline tax from 20 to 25 cents per gallon in order to "pay as you go" in funding new projects, Johnson said. In addition, the license tab change will generate about $90 million in the first year and $105 million in the second year of the biennium. Under the license tab change, the depreciation schedule is that the vehicle registration tax is 100 percent of base value the first year, 80 percent the second year, 70 percent the third year, 60 percent in the fourth year, 50 percent in the fifth year, 40 percent in the sixth year, 35 percent in the seventh year, 30 percent in the eighth year, 20 percent in the ninth year and 10 percent in the tenth year.

The proposal also appropriates $61.533 million in FY 04 and $63.733 million in FY 05 from the general fund for metropolitan transit. In addition, the measure provides $13.4 million for the biennium for the operations of the Hiawatha LRT line and provides a budget base of $18.7 million for the next biennium.

The bill also makes a number of cuts in department administration. In addition, the measure prohibits spending for mobile telephones or pagers for department employees, prohibits spending on passenger cars for employees and prohibits the use of state funds on travel for attending conventions or seminars not sponsored by the department.

Johnson said amendments and testimony on the measure would be heard at a subsequent hearing prior to taking a vote on the proposal.

In other action, the division approved a bill setting forth requirements for additional identity and residency information needed to obtain a driver's license. S.F. 1103, sponsored by Sen. Mee Moua (DFL-St. Paul), also specifies the personal information that may be shown on a driver's license or identification card. Moua said the bill also provides for the expiration of the license or card on the expiration date of the person's federal admission period. The bill does not provide for the "status check" that was adopted by rule, Moua said.

Sen. Dave Kleis (R-St. Cloud) moved to amend the bill with the contents of S.F. 87. The measure implements a number of other requirements and does contain the "status check" date on the license or identity card. Kleis said the amendment allows the Dept. of Public Safety to have more discretion in the kinds of information needed to establish identity. He also said the bill, by having stiffer requirements to establish identity, will prevent identity theft.

Sen. Ann Rest (DFL-New Hope) questioned the use of two dates that would be used under the amendment. She said it did not make sense to have a date four years after issuance for the driver's license to expire and then a separate status check date indicating the visa expiration date. Rest said there were elements of the Kleis amendment that she thought were valuable, but that she could not support the entire amendment.

The amendment failed on a 6-9 roll call vote. Sen. Sharon Marko (DFL-Cottage Grove) offered an amendment to include a provision of the Kleis amendment requiring full face images to be used in the photos on the driver's license or identification card. The amendment was adopted.

The bill was approved on an 8-5 roll call vote and advanced to the Senate floor.

Work on omnibus bill continues
Members of the Transportation Policy and Budget Division continued their work on the omnibus transportation appropriations package, Thurs., Apr. 24, by considering 18 amendments. The focus of the amendments ranged from drivers license provisions to penalties for cigarettes thrown out of vehicles to the formula for distributing county state-aid highway (CSAH) funds.

Members began their work by adopting three amendments offered by Sen. Dean Johnson (DFL-Willmar), division chair. The amendments provide for a study of including rumble strips on the centerline of all two-lane highways, require the Metropolitan Airports Commission to include the representative of taxicab owners, companies or associations on a taxicab advisory committee and make technical changes to the proposal.

Johnson also offered an amendment making changes to the CSAH formula. Current law apportions CSAH money by dividing 10 percent equally among all 87 counties, 10 percent is apportioned based on counties' vehicle registration, 30 percent is allocated based on county lane-miles and the remaining 50 percent is apportioned based on county needs. The amendment apportions that amount of CSAH funds attributable to the current gas tax by following the existing formula. However, the amendment provides that CSAH dollars that can be attributed to gas tax revenues from the additional five cents added to the gas tax in the bill by a new formula: 10 percent equally, 10 percent based on lane-miles, 30 percent based on population and 50 percent based on needs. Johnson said the amendment represents a proposal carried by Sen. Keith Langseth (DFL-Glyndon) last year.

Langseth said the proposal is a midpoint between the present formula and formula advanced, at one time, by the Metropolitan Inter-County Association (MICA). He noted that counties that are experiencing the fastest growth see their CSAH dollars increase faster because of the population factor. Langseth said proponents of massive overhauls of the CSAH formula ignore the fact that the bulk of transit money goes to the Metro Area, while the bulk of CSAH funding does go to Greater Minnesota. If population is to be the determining factor, he said, then Greater Minnesota should get more transit money, even though the major transit needs are in the Metro Area.

However, Sen. Julianne Ortman (R-Chanhassen) said she was concerned because the proposal is limited to the new money. All of CSAH funding should be distributed according to the same formula, she said. Her own proposal divides the funds equally between needs and population, she said. Congestion is a serious problem in the Metro Area, Ortman noted. However, Langseth said changing the entire CSAH formula will create huge losers in Greater Minnesota and will mean that many counties get no money for road construction. He also reminded members that CSAH funding is not the only method for funding roads. Langseth noted that over 60 percent of municipal state-aid street (MSAS) funding goes to the Metro Area. No MSAS dollars go to communities with fewer than 5,000 residents, he said. If one examines all transportation dollars-state and federal, from all programs-then the spread is almost equal between Greater Minnesota and the Metro Area, he said.

The current formula, when applied to the existing money, said Sen. Sharon Marko (DFL-Cottage Grove), serves Metro Area residents too, especially those who vacation in Greater Minnesota. The current formula for the existing money helps maintain the roads that are already on the ground. A 50-50 needs-population formula is fair for the new money, Marko said. Sen. Steve Murphy (DFL-Red Wing) said that if Greater Minnesota cannot address its transportation needs, then the Metro Area will see an even greater population growth and congestion will only be worse.

Johnson withdrew the amendment, but encouraged members to continue considering the CSAH issue.

Panel members also discussed several amendments adding specifications to appropriations already in the bill without increasing the total appropriations. Marko offered an amendment requiring that $200,000 of the over $40 million appropriated for aeronautics must be used for hangar construction at the South St. Paul (Fleming Field) airport. The amendment was adopted. Sen. Charles Wiger (DFL-North St. Paul) offered two amendments adding projects to a list of accelerated projects contained in the measure. The amendments add the reconstruction projects at the intersection of TH-36 and McKnight Road and the intersection of I-94 and Century Avenue and McKnight Road to the list. The amendments were adopted. Sen. Claire Robling (R-Jordan) said projects should not be given priority in law. It is our job to get resources and the department's job to decide on which projects get those resources, she said. Politicians should not be prioritizing projects, Robling said. She offered an amendment deleting the entire prioritized project list. The amendment was defeated on a divided voice vote.

Ortman offered an amendment changing a provision in the bill increasing the driver's license reinstatement fee by $50 and reapportioning the revenue from the fee. Under the bill, 17 percent of the revenue goes to the trunk highway fund, 7 percent to the Bureau of Criminal Apprehension, 56 percent to the general fund and 20 percent to the traumatic brain injury fund. The amendment provides that the percentages for the trunk highway fund and general fund remain the same, while the BCA receive 8 percent, the traumatic brain injury fund 14 percent and the special revenue fund receive 5 percent. The amendment also creates a vehicle forfeiture account within the special revenue fund to hold the revenue. Ortman said the five percent is to help the State Patrol hire non-uniformed staff to deal with auctioning forfeited vehicles. Vehicle forfeiture, she said, is an effective tool for state troopers, but troopers should not be using their time to auction cars instead of being on the roads. The amendment was adopted.

Members also adopted an amendment, offered by Ortman, permitting the Dept. of Public Safety to issue corrective orders to deputy registrars, rather than suspending them. Murphy also offered an amendment relating to deputy registrars. The amendment, which was adopted, raises the filing fee charged by deputy registrars for driver's license renewals to $4.50, from $3.50. Another Murphy amendment, also adopted by the panel, creates a primary offense for seat belt violations and increases the fine for seat belt violations to $50, from $25.

Sen. Dave Kleis (R-St. Cloud) offered an amendment adding cigarettes to the list of dangerous objects that are illegal to throw or dump onto a highway. The amendment also imposes a surcharge, equal to the amount of the fine, onto fines of persons who throw cigarettes from motor vehicles. The amendment was adopted. Sen. Ann Rest (DFL-New Hope) offered an amendment, adopted by the division, prohibiting the Metropolitan Council from reducing the public services offered at the Hubbard Marketplace transit station in Robbinsdale as long as the transit station remains in operation. A second Rest amendment includes provisions from two measures relating to driver's licenses, such as proof of identity and residency requirements, full-face image requirements and the expiration of a license being the same as the expiration of a visa. The amendment was adopted. Langseth also offered an amendment, which was adopted, deleting a transit ways fund created in the bill. Sen. Mee Moua (DFL-St. Paul) offered an amendment, adopted by the panel, providing $2.5 million to match federal funds for the Central Corridor. The funds are transferred from the employee insurance trust fund reserve account.

Two additional amendments were considered but were not approved. One, offered by Robling, specifies that the I-35W/TH-62 interchange project is deemed to be entirely within the interstate highway system for the purposes of the municipal consent law. Robling said the amendment keeps the project from being stalled again, when the state cannot afford to go back to the drawing board. However, Dibble spoke against the amendment, saying Minneapolis has officially indicated its support for the current plan and does not intend to stall the project. The amendment, he said, breaks the trust between the city and the department. The amendment was defeated on a divided voice vote. The other amendment, offered by Murphy, appropriates $3 million from the general fund for port development assistance. However, upon being advised by counsel that the amendment puts the bill above its funding target, Murphy withdrew the proposal.

Taxes
Bills heard
The Tax Committee, chaired by Sen. Lawrence Pogemiller (DFL-Mpls.), returned from a four day break to consider several bills for inclusion in the omnibus bill. The panel began with hearing a number of bills relating to local sales taxes. S.F. 774, sponsored by Sen. Mark Ourada (R-Buffalo), authorizes the city of Clearwater to impose an additional sales and use tax to fund parks, trails, parkland, open space and land and buildings for a regional and recreation center. S.F. 1222, authored by Sen. Richard Cohen (DFL-St. Paul), modifies the conditions for use of the St. Paul sales tax for the operating expenses of cultural organizations. S.F. 1469, carried by Pogemiller, provides a sales tax exemption for materials used in construction for the Guthrie Theater. S.F. 1481, sponsored by Sen. Sharon Marko (DFL-Cottage Grove), authorizes the city of Newport to impose a lodging tax to fund economic development and redevelopment of the city.

Pogemiller also sponsored three additional bills. S.F. 1400 regulates income tax preparers and provides standards of conduct. S.F. 1401 is the annual public finance bill and provides for capital improvement bonds for cities, counties and other municipalities.

S.F. 1505 is a bill extending the time for qualifying for sales and property tax exemptions for the Crown hydro electrical generation facility.

Two bills dealing with generating electricity from poultry litter were also discussed. S.F. 1483, authored by Sen. Dean Johnson (DFL-Willmar), modifies the dates for construction of a poultry litter biomass electrical generation facility for personal property tax exemption purposes. The bill was amended into another proposal, S.F. 1510, also sponsored by Johnson, which extends a sales tax exemption for construction materials for the biomass electrical generation facility.

S.F. 1478, authored by Sen. Thomas Bakk (DFL-Cook), authorizes the housing and redevelopment authority for Lake County to extend the duration of a redevelopment tax increment financing district. A second measure, sponsored by Sen. Sheila Kiscaden (IP-Rochester), modifies tax increment financing provisions for small cities.

Measures considered for omnibus bill
Members of the Tax Committee met Wed., Apr. 23, to continue considering legislation for the omnibus tax bill. Chaired by Sen. Lawrence Pogemiller (DFL-Mpls.), Senators considered bills relating to tax exemptions for electricity generation facilities and tax free zones, as well as other measures.

Eight measures were approved for inclusion in the omnibus tax bill. S.F. 1441, sponsored by Sen. Tom Saxhaug (DFL-Grand Rapids), provides for a sales tax exemption for biomass electric generation facilities. Sen. Jim Vickerman (DFL-Tracy) carried S.F. 1259, clarifying the corporate status of the Lewis and Clark Rural Water System as it relates to the issuance of obligations for federal income tax law purposes. S.F. 715, authored by Sen. David Knutson (R-Burnsville), provides a personal property tax exemption for an electric generation facility in Rosemount. Another bill providing a personal property tax exemption for an electric generation facility was sponsored by Sen. John Hottinger (DFL-St. Peter). S.F. 1205 provides an exemption for a facility in Mankato. Sen. Dallas Sams (DFL-Staples) carried a bill, S.F. 1381, providing for a property tax valuation exclusion for sewage system improvements. S.F. 1345, authored by Sen. Don Betzold (DFL-Fridley), validates bonds issued by Anoka County for public safety radio improvements. Sen. Steve Kelley (DFL-Hopkins) carried a bill, S.F. 1104, expanding, to all counties, the authority to issue capital improvement bonds to finance the cost of designing, constructing and acquiring statewide public safety radio communication system infrastructure and equipment. Pogemiller sponsored S.F. 1513, which provides for State Fair revenue bonds.

Sen. Thomas Bakk (DFL-Cook) carried a bill that was not approved for inclusion. S.F. 1478 permits Lake County to extend the duration of a tax increment financing district for 16 years.

The committee took no action on two bills providing for tax free zones. Bakk sponsored S.F. 496, which is the governor's Job Opportunity Building Zones bill. Kelley carried a bill, S.F. 1067, providing for a biotechnology tax free zone.

Omnibus bill discussed
Members of the Tax Committee devoted the Thurs., Apr. 24, hearing to a discussion of the noncontroversial omnibus tax proposal. The panel, chaired by Sen. Lawrence Pogemiller (DFL-Mpls.), considered several amendments and advanced the bill to the full Senate. The measure contains a variety of sales tax exemption, tax increment financing and other miscellaneous tax provisions that do not affect the budget as a whole.

Floor action
Campaign Finance Board appointees confirmed
Senators returned from their spring recess to confirm two gubernatorial appointees, Tues., Apr. 22.

The appointments of Terri Ashmore and Bob Milbert to the Campaign Finance and Public Disclosure Board were confirmed. Ashmore replaces Susan Stevens Chambers as a public member of the board. Milbert, a former member of the other body, replaces former Sen. Allan Spear. Both terms expire in 2007.

Senators also granted final passage to five bills on the Consent Calendar. S.F. 958, carried by Sen. Steve Murphy (DFL-Red Wing), classifies military certificates of discharge as private data. Sen. Thomas Neuville (R-Northfield) sponsored H.F. 850, providing for a land conveyance in Sibley County. H.F. 1112, also authored by Murphy, authorizes the Department of Veterans Affairs to access Department of Human Services databases to verify eligibility for the state soldiers assistance program. Sen. Charles Wiger (DFL-North St. Paul) carried a bill, S.F. 163, requiring sellers of real property in Washington County to disclose if the property is located in a special well construction area designated by the commissioner of health. S.F. 1225, sponsored by Sen. Keith Langseth (DFL-Glyndon), restricts the involvement of the state archaeologist with archaeological or historic sites to known or scientifically predicted sites.

View selected images from the week.