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Note: The Senate Information Office has toll-free telephone numbers to enable citizens of Greater Minnesota to obtain general information about the Minnesota Senate. The telephone numbers are: 1-888-234-1112 (voice) and 1-888-234-1216 (TTY).
Update: May 16, 2003 12:05 p.m.
The committee focused its work on property tax provisions. Pogemiller offered an amendment consisting of the property tax proposal, including a freeze of local property taxes. The amendment also raises the class-rate for commercial and industrial property to 2.25 percent, but the increase will not go into effect if the Legislature increases the statewide business property tax. A scheduled reduction in the class-rate for apartment property is postponed by two years, but the delay does not take effect if the statewide business property tax is increased. The proposal also includes the governor's proposed local government aid (LGA) formula, with additional factors included. However, LGA funding is phased in to the new formula over three years, so that the new formula is in full effect in 2006.
Members heard brief testimony on the proposal. Bill Blazar, Minnesota Chamber of Commerce, said the proposed property tax provisions represent a "pick your poison" choice for businesses. He said increases in local property taxes are not certain, though they are likely, and that an increase in the business property tax makes Minnesota businesses less competitive and is not based on ability to pay. Blazar said business taxes only make the overall tax structure more regressive. Increasing the commercial-industrial class-rate shifts the local tax burden from homeowners to businesses and erodes the accountability that came with the 2001 tax reforms, he said. The business community disagrees with the premise that the statewide business tax was meant to finance the takeover of the general education levy in 2001, Blazar said.
Jack Horner of the Multi-Housing Association said that tenants ultimately pay the property taxes on apartments. On average, he said, apartment dwellers are among the lowest-income members of society. Glenn Dorfman, Minnesota Association of Realtors, said raising the commercial-industrial rate during a recession hurts businesses generally and specifically damages start-up industries. New businesses pay more of what income they have in property taxes than established companies, he said. Dorfman said the 2001 tax reforms did not promise more money for education, but only that what money goes to school would come from the state. He also opposed the property tax freeze, saying that if homeowners choose to raise their own property taxes, it is not the state's job to step in and either buy those taxes down or shield homeowners from the consequences of their choice.
Wayne Cox of Minnesotans for Tax Justice and Cheryl Furrer, representing Education Minnesota, spoke in support of the proposal. Cox said the property tax reforms of 2001 were based on predictions of never-ending surpluses. The surpluses did not materialize, he said, but education needs the funding it was promised. Furrer said the proposal means that cuts will be made in education, but not as deeply as the governor's proposal.
Members adopted the amendment, adding the property tax provisions to the omnibus bill. Sen. Julianne Ortman (R-Chanhassen) said tax increases come with a substantial cost, including fewer jobs and less investment in capital. However, Pogemiller said there are costs to all spending and taxing decisions. Laying off a worker from the public sector has the same economic cost as laying off a worker from the private sector, he said. The bill also avoids shifting the state's problems to local units of governments, Pogemiller said. The omnibus proposal was approved, on an 8-4 roll call vote, for introduction as a committee bill by Pogemiller.
Pogemiller said many of the provisions are from the bill, S.F. 1504, sponsored by Sen. John Hottinger (DFL-St. Peter), that creates a fourth income tax bracket, increases the cigarette tax and makes changes to corporate franchise taxes. Pogemiller indicated the committee would hear testimony and offer amendments, but that the panel would not vote on the provisions of the bill until the next hearing.
Jeremy Hanson, Minnesota Smoke-Free Coalition, said that raising taxes on cigarettes is a proven factor in decreasing demand for tobacco, especially among teens. R.J. Reynolds has said that a 10 percent increase in cigarette prices creates an 11 percent decrease in teen demand, Hanson said. He said the proposed $1 increase-contained in S.F. 1504, sponsored by Sen. John Hottinger(DFL-St. Peter)-will reduce teen smoking by 18 percent and create long-term health care savings of $1 billion. Low-income populations, he said, are four times more likely to quit smoking because of a price increase than other smokers. Hanson also said that most cigarettes are sold by the pack and that no more than 5 percent of smokers will take advantage of tax avoidance schemes-such as buying tobacco on Indian reservations or military installations, crossing state borders or buying on the Internet.
Representing the Cigar Association of America, Cort Holten said that raising the tax on other tobacco products, including cigars, will have a negative impact on both retailers and state revenues. He said there are two ways for state revenues to decline from an increase in the cigar tax. Because the tax is indexed to price, as the final price of the cigar rises, consumers will switch to cheaper products, leading to a lower tax revenues, he said. Holten said the other option consumers have is to purchase cigars on the Internet, avoiding the tax completely. He said cigar retailers are already experiencing the effects of the Internet, as consumers use cigar shops to buy individual cigars and choose a brand they prefer and then buy the brand by the box online. Holten said New Jersey doubled its cigar tax in 1998 and reversed course a year later, after revenues declined.
Dick Gebhart, Dept. of Revenue, provided the committee with information about the history of the state's cigarette and tobacco taxes. He also explained the principle of elasticity, which economists use to estimate the effects of a price increase on demand. Gebhart said the department calculates that the $1 cigarette tax increase is equivalent to a 29 percent increase in the average retail price and will decrease demand by 16 percent, or about 56 million packs of cigarettes. To reach a point where the $1 tax increase will have negative effects on state revenues, he said, almost 40 percent of smokers would have to quit smoking or buy cigarettes elsewhere.
Members also heard testimony on the individual income and corporate franchise tax provisions of S.F. 1504. Harold Hamilton, president of Micro Control Company in Fridley, said that manufacturing companies are hurting in Minnesota and the sector is shedding jobs. The current tax rates already make it hard to entice companies to move here or expand here, he said. Mike Hickey, representing the National Federation of Independent Businesses, said the tax increase proposals have a chilling effect on entrepreneurs, the same people who we want to expand their businesses, hire others and lead the state out of the economic doldrums. The proposed 9.4 percent rate for the highest income earners will be the second highest in the nation, behind Montana, he said. Hickey said that a vast majority of small businesses are registered as subchapter S corporations, which means that taxes are paid via the individual income tax. Small business owners are unduly attacked by the rate increase, he said. However, Sen. David Tomassoni (DFL-Chisholm) said the state isn't losing businesses, but only losing jobs. He said the governor's budget means more job loss, by state employees, in a time when there are few jobs to be had.
Wayne Cox of Citizens for Tax Justice and Deb Koechene of the Welfare Rights Committee both spoke in support of the tax increase proposals. Cox said businesses are more effective if the workforce is more productive, which happens when workers have access to effective education and efficient and reliable transportation. He said businesses also benefit from the research done at public universities. The ability to deduct state taxes from the federal income tax, Cox said, has a leveling effect on tax rates. He said the short-term strategy of balancing the budget with cuts puts the state at risk of incurring massive costs in the future, especially in health care. Koechene said that S.F. 1504 is a good starting point, but it does not go far enough. She said those with the most should pay their fair share. She urged the panel to undo the permanent income tax reductions of the late 1990s, to eliminate what she called "corporate loopholes" and to raise taxes on the wealthy.
Several gaming proposals were also before the committee. Sen. Dick Day (R-Owatonna) carried H.F. 646, which authorizes casino gaming at Canterbury Park in Shakopee. The proposal, known as the "racino," creates 1,400 new jobs, Day said, and helps the horse industry. He said the plan does not expand gambling in the state, but takes advantage of the growth that is already projected to occur in gaming in Minnesota and provides the state with new revenues from that growth. The racino will not directly compete with 16 of the 17 tribal casinos, Day said, and is not expected to have a negative impact on Mystic Lake, which is located in Prior Lake, about 4 miles away. Canterbury CEO Randy Sampson said the proposal has strong public support, keeps racing competitive and viable in Minnesota, and provides significant benefits: state revenues, new jobs and economic development in Scott County.
A Dept. of Revenue analysis of the proposal indicates that it nets the general fund about $100 million in FY 04-05 and $99.5 million in FY 06-07. The legislation dedicates 55.5 percent of adjusted gross revenues to the state in FY 04-05, 31.5 percent in FY 06-07 and 40 percent from FY 08 forward. "The market is very much like 'Field of Dreams,'" said Lottery Director George Anderson, "if you build it, they will come." The estimates of consumer demand and revenue are in the very reasonable range, he said. The only wildcard is the proximity of Mystic Lake, Anderson said, as no other racino has a casino of comparable size that close.
Another gaming proposal was sponsored by Sen. Linda Scheid (DFL-Brooklyn Park). The plan provides for a harness racing track with a casino, to be located at least 20 miles from any existing racetrack, she said. Scheid the probable location is in the northern Metro Area, about 40 miles away from Canterbury. She said the proposal is not an alternative to the Canterbury racino, but is meant to provide another option for development. Sen. Sandra Pappas (DFL-St. Paul) sponsored a proposal that includes a Metro Area casino to benefit the state and the Red Lake and White Earth tribes. She said the compacts that provide for Indian gaming were meant to benefit all of the state's native people. However, the Red Lake and White Earth tribes have not benefited, because of a geographic accident, she said. The final gaming proposal was offered by Sen. David Tomassoni (DFL-Chisholm). The plan provides for video gaming machines to be placed in licensed beverage establishments, up to 10 per establishment. Tomassoni said the proposal will net the state $350 million per year. The proposal has a minimal impact on tribal casinos, he said, because the machines are spread throughout the state and people do not go to restaurants or bars to gamble, but to socialize.
Representatives of the tribal casinos spoke against the proposals. Melanie Benjamin, Mille Lacs Band of Ojibwe, said that a state-operated casino in the Metro Area will harm Greater Minnesota communities. She said the greatest direct threat to the Mille Lacs band's two casinos is a casino in the northern suburbs. The racino will mean a 20 percent decline in revenues and 600 jobs lost from the two casinos, she said, while a northern Metro Area casino will cause a loss of about 50 percent of revenues and about 1,500 jobs. Gordon Adams of the Bois Forte Band of Ojibwe said the state has been threatening to compete with Indian gaming since the compacts were signed. The constant threats have not built good will or cooperation, he said. Adams said that the racino will create a marketing war in the Metro Area. As Mystic Lake loses market share, he said, it will reach outside the Metro Area to attract gamblers. The casinos in Greater Minnesota cannot afford to be drawn into a marketing war of that scale, he said.
Helen Blue, Upper Sioux Community, raised several regulatory questions about the racino. She said policymakers should also look at Nevada. While Las Vegas is thriving and new casinos are being built there, Reno is dying, she said. Blue also said that a provision in H.F. 646 is heinous and the most anti-Indian piece of legislation she has ever seen. Section 18 of the bill provides that if all of the tribes operating casinos agree to contribute to compulsive gambling treatment programs, to donate six percent of their gross revenues to the state and not to add new gaming machines to their casinos, then the racino is not authorized to be built. Blue said the concept was comparable to asking every municipal liquor store to contribute to chemical dependency treatment programs. John McCarthy of the Minnesota Indian Gaming Association said the real issue behind the racino is Canterbury Park Holding's stock price. He said the stock has risen significantly since the state authorized the racetrack to operate a card club and since the racino proposal was introduced. The tribes have never sought to revisit the issues addressed in the compacts or expand gaming, McCarthy said, but the state has entertained several proposals over the years.
Committee members continued hearing testimony on the gaming proposals at their Wed., May 7, hearing. The panel also discussed local government aid (LGA) and heard testimony on various proposals altering the state's LGA distribution formula.
The measure, carried by Sen. Dean Johnson (DFL-Willmar), contains a 5 cent per gallon gasoline tax increase and alters the registration tax schedule. Johnson said the new license tab schedule essentially undoes the schedule put in place during the Ventura administration. Johnson said the bill raises a total of $519 million for the biennium, with $200 million from the new license tab schedule and $319 from the gasoline tax increase. He said $151 million is earmarked for transit and $383 million for highways. Of the $383 million, $226 million is for trunk highways, $124 million is for county state-aid roads and $33 million is for municipal state aid roads. In the area of transit, of the $151 million, $75 million is slated for Metro Transit, $14 million for Greater Minnesota transit and $62 million for transitways.
Discussion on the bill, though, centered on a provision allowing municipalities to impose a transportation utility fee. Jack Horner, representing the Minnesota Multi-Housing Association, said the fee is, in fact, a tax based on trips generated. Under the bill, municipalities may impose the transportation utility fee against property, calculated on the relationship of the revenues the municipality proposes to generate and a trip generation rate for each type of land use. The bill specifies that revenue must be used for projects for reconstructions, facility upgrades and maintenance. Horner said the formulas used to calculate the fees are very complex and may result in a lack of fairness and the creation of a whole new bureaucracy. "It is a massive undertaking and contains potential for trouble," Horner said.
Anne Finn, League of Minnesota Cities, said the fee is optional and is another tool for financing road improvements.
Amber Backhaus, Minnesota Trucking Association, also spoke against the provision. She said the provision was also opposed by a variety of other organizations, including the Minnesota Retailers Association.
Sen. Julianne Ortman (R-Chanhassen) offered an amendment to remove the provision. The amendment was adopted on a voice vote. She said the fee drastically altered city financing.
Members also approved an amendment authorizing exceptions to logging truck weight limits. Sen. David Tomassoni (DFL-Chisholm) said the amendment was intended to be included in the omnibus package, but had been left out unintentionally.
The omnibus package was advanced to the full Senate.
Committee Chair Lawrence Pogemiller (DFL-Mpls.) said at the beginning of the hearing, "It is very clear that this is where we have a philosophical parting of the ways." He said the governor's plan increases fees and property taxes, but that the work done by Senate finance divisions has made it clear that there is a need for revenue increases to blunt the deep cuts in state services.
Sen. Julianne Ortman (R-Chanhassen) countered, "I don't think it is the governor's intention to raise property taxes and I don't think it is fair to assume there will be property tax increases. He has indicated in his budget that property taxes do not need to be increased." Sen. William Belanger (R-Bloomington) added, "It is a local decision to raise taxes."
Pogemiller responded, "It is the majority caucus' position that we should not force local governments to solve the state budget problem which is what will happen if the governor's cuts to local government aids are enacted."
Hottinger said, "The governor admits there will be property tax increases, but the Senate DFL proposal reflects accountability and sets forth alternatives." He added, "The bill gives Minnesotans an opportunity for everyone to share in the solution-even the more affluent." Hottinger said the majority budget proposal reflects care for others and maintains the state's effort for the common good that has served to make Minnesota great. "The key is balance," Hottinger said.
The bill raises $1.395 billion in revenue for the biennium. Under the proposal a new tax rate of 9.4 percent is created for a fourth individual income tax bracket. The higher rate applies to married taxpayers filing joint returns with a taxable income over $200,000 and for single taxpayers with a taxable income over $113,120. The measure also establishes a throw back rule for the corporate franchise tax, reduces the deduction for dividends received by corporations and alters the requirements for qualifying as a foreign operating corporation. The measure also increases the tax on cigarettes by $1 per pack and increases the excise tax on tobacco products other than cigarettes from 35 percent to 60 percent of the wholesale price.
Pogemiller said the committee would not take formal action on the bill, but would begin hearing testimony on the measure.
The first person to speak on the bill, Tom Lehman of the Minnesota Hospital Association, said the association strongly supports the increase on the cigarette tax. He said an increase in the cigarette tax is beneficial in both the short and long term because increased prices discourage youth smoking in the short term and fewer people smoking lowers future health care cost. In addition, Lehman said the increased revenue allows the state to mitigate some of the cuts in the governor's budget. "Cutting 68,000 people from health care doesn't stop people from needing health care," Lehman said. Safety net hospitals are facing reductions that will be eased by the cigarette tax, he said.
Duane Benson, executive director, Minnesota Business Partnership, spoke in opposition to the bill. "Now is probably not a good time to raise taxes," Benson said, "Unemployment is rising, consumer confidence is lagging and sluggish corporate profits point to a struggling economy." He said if corporate taxes are raised, there will be less corporate activity, less in wages, less in job growth and less investment. "Corporate taxes are very regressive taxes; the costs will be borne by somebody-the wage earner, the shareholder or the consumer," Benson said.
Bill Blazar, Minnesota Chamber of Commerce, also spoke in opposition. "It is important to keep in mind that the state's economy remains fragile. We are fearful that any tax increase will prolong the time needed for recovery," Blazer said. He said the Minnesota Chamber is opposed to any increase in corporate or income taxes.
S.F. 1528, carried by Sen. LeRoy Stumpf (DFL-Thief River Falls), represents the work of the E-12 Education Budget Division. Stumpf said the panel had a target of almost $12.045 billion. The bill, he said, provides about $91 million more than the governor's proposal, and does not require property tax increases. Stumpf and Fiscal Analyst Eric Nauman reviewed the provisions of the bill, especially those relating to property tax levies.
Committee members considered several amendments. One, offered by Sen. David Tomassoni (DFL-Chisholm), removes reverse referendum requirements from the measure. An amendment, offered by Sen. Julianne Ortman (R-Chanhassen), requires school districts with a levy referendum on the November ballot to publish their audited financial statements by October 1. Current law requires all districts to publish the statements by November 30. Ortman said the amendment makes sure voters have accurate information about district finances before they vote on a levy referendum. However, Bob Meeks of the School Board Association said auditors already have a hard time meeting the November 30 deadline. Moving the deadline up 60 days, he said, may have tremendous, unintended consequences, including endangering the construction of school buildings. Both amendments were adopted.
Tomassoni also offered the amendment removing the appropriations from the bill. Sen. William Belanger (R-Bloomington) said the proposal will unnecessarily complicate final negotiations with the other body and the governor. However, Pogemiller said the plan is to link the source of funds for education to the appropriation of those funds. Members adopted the amendment, along with two amendments to the appropriations language. Sen. Rod Skoe (DFL-Clearbrook) offered an amendment reducing lease aid payments to charter schools. Sen. Steve Murphy (DFL-Red Wing) offered the other amendment, reducing the maintenance of effort requirement for libraries to 90 percent of the previous year's spending.
Members then advanced S.F. 1528, the policy provisions, to the full Senate and approved a motion to include the appropriations portions in the second omnibus tax bill.
In other action, members considered several other measures for inclusion in the second omnibus tax bill. S.F. 1394, sponsored by Tomassoni, updates mineral taxation provisions to modern practices, including an integrated mining and refining process. The bill was approved for inclusion in the omnibus bill.
Five measures were laid over for possible inclusion in the omnibus bill. Sen. Mee Moua (DFL-St. Paul) authored S.F. 1492, which provides an income tax credit for affordable housing contributions. Another bill relating to mining, S.F. 476, was carried by Sen. Thomas Bakk (DFL-Cook). The measure changes the computation for the mining occupation tax rate. S.F. 1499, authored by Sen. John Marty (DFL-Roseville), limits the deduction for mortgage interest to $25,000 per year. Moua also sponsored S.F. 1520, which eliminates various wholesalers' discounts given to cigarette distributors for their role in the collection of tobacco taxes. Sen. Satveer Chaudhary (DFL-Fridley) carried S.F. 1221, which requires employers to make a good faith effort not to misrepresent employees as independent contractors.
Members also considered another Chaudhary bill, but did not approve it for inclusion in the omnibus bill. S.F. 1498 permits the city of New Brighton to impose a one percent tax on the sale of intoxicating beverages, either on-sale or off-sale, to fund community policing efforts. Committee members expressed concern that the proposal represents a significant change in tax policy and the funding of local public safety.
Discussion in the hearing centered on the cuts to local government aids. Members discussed charts prepared by department staff and Senate staff outlining the percentage decrease for each Minnesota county. No action was taken on the measure.
S.F. 748, sponsored by Sen. William Belanger (R-Bloomington), contains the provisions lowering the amount of local government aid cities and local units of government receive from the state. The measure also establishes levy limits, makes the sales tax accelerated June liability provisions permanent and provides for cash flow and budget reserve amounts. The committee laid the bill over for further discussion.
The panel did advance several bills to the full Senate. S.F. 755, authored by Sen. Richard Cohen (DFL-St. Paul), prohibits state agencies from entering into contracts with corporations if the corporation is incorporated in a tax haven country and the U.S. is the principal market for the public trading of the corporation's stock. S.F. 579, sponsored by Sen. Dallas Sams (DFL-Staples), establishes the Central Lakes Region Sanitary Sewer District. S.F. 829, sponsored by Sen. Scott Dibble (DFL-Mpls.), makes a number of changes relating to the Metropolitan Council. The bill establishes a division committee for parks on the Met Council, provides for direct charging of industrial dischargers for wastewater treatment user fees and repeals some obsolete provisions.
S.F. 392, carried by Sen. Steve Murphy (DFL-Red Wing), updates soil and water conservation district provisions. The measure was amended to retain tax related provisions in the committee and send the policy provisions on to the full Senate.
S.F. 823, sponsored by Sen. Leo Foley (DFL-Coon Rapids), providing that government units are not required to pay defendants' attorney fees for certain appeals, was laid over.
Finally, S.F. 1465, carried by Pogemiller, did not gain the committee's approval. The bill eliminates the authority of the state auditor to enforce the tax increment financing laws.
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.
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.
S.F. 901, sponsored by Sen. Michele Bachmann (R-Stillwater), provides for the physical appraisal of property every five years rather than every four years. S.F. 1145, sponsored by Sen. David Tomassoni (DFL-Chisholm), extends the terms for which certificates of indebtedness for public safety equipment, ambulance equipment and road construction may be issued by statutory cities. The term is increased from 5 to 10 years under the bill. S.F. 161, authored by Sen. Thomas Bakk (DFL-Cook), provides that the Cook County Hospital District levy may be adjusted for inflation. S.F. 1299, carried by Sen. Carrie Ruud (R-Breezy Point), provides for homestead classification for resorts owned by a limited liability company. S.F. 321, also carried by Ruud, delays the date by which class 1c property or class 4c resort property taxes are due until July 15. S.F. 1236, authored by Sen. Linda Higgins (DFL-Mpls.), provides a valuation exclusion for lead paint removal. S.F. 1242, carried by Sen. Mee Moua (DFL-St. Paul), specifies that in determining the market value of class 4d rental property, the assessor must reduce the value of the property by its restricted use value using guidelines set by the commissioner. S.F. 714, sponsored by Sen. Tom Saxhaug (DFL-Grand Rapids), extends the property tax exemption for business incubators. S.F. 1004, authored by Sen. James Metzen (DFL-South St. Paul), allows levies to exceed charter limits as property tax aids decrease. S.F. 480, sponsored by Sen. Steve Murphy (DFL-Red Wing), requires the state to share with counties five percent of the excise taxes collected from casino gaming on a reservation in the county if the tribal government has not entered into a tax agreement. S.F. 1418, carried by Sen. Steve Kelley (DFL-Hopkins), modifies the 60 day rule in dismissal of property tax petitions. S.F. 1011, authored by Sen. Michelle Fischbach (R-Paynesville), repeals an aggregate tax exception for Benton and Stearns Counties. All of the above bills will likely be included in the omnibus tax bill.
Two measures were laid over for possible inclusion in an omnibus tax increment financing bill. S.F. 1443, sponsored by Murphy, allows disaster areas to qualify as redevelopment districts with an original tax capacity equal to the land value. S.F. 1477, carried by Pogemiller, authorizes the creation of a redevelopment tax increment financing district in Richfield.
The committee also heard a number of bills which may be included in the omnibus bill. S.F. 1412, sponsored by Sen. Keith Langseth (DFL-Glyndon), extends the city of Moorhead's authority to impose a tax levy. S.F. 988, also carried by Langseth, advances a date for the designation of border city development zones and authorizes additional allocations. S.F. 319, a third bill carried by Langseth, accelerates the annual dates for the commissioner of revenue to certify the state general property tax levy rate to county auditors and accelerates the date for delivery of proposed property tax notices to taxpayers. S.F. 1413, carried by Tomassoni, authorizes the extension of a tax increment financing district in Hibbing. S.F. 1434, also sponsored by Tomassoni, treats the state general tax rate as a local tax rate for purposes of a tax increment financing district in Hibbing. S.F. 1492, authored by Moua, provides a tax credit for qualifying affordable housing contributions. S.F. 366, authored by Sen. Steve Dille (R-Dassel), repeals proposed property tax notice and hearing requirements of local government units.
S.F. 482, sponsored by Moua, eliminates limits on local government aid increases. S.F. 659, authored by Sen. Scott Dibble (DFL-Mpls.), also eliminates limits on local government aid increases. S.F. 211, authored by Sen. Richard Cohen (DFL-St. Paul), extends the phase-out of limited market value for purposes of determining property taxes. S.F. 996, authored by Sen. Ann Rest (DFL-New Hope), converts the state general tax on commercial-industrial property to a tax based on land value. S.F. 1189, sponsored by Sen. Dick Day (R-Owatonna), expands the valuation and property tax deferment for open space to auto racing tracks. S.F. 1358, sponsored by Sen. Thomas Neuville (R-Northfield), excludes individuals with rent constituting property taxes paid by the group residential housing program from the definition of claimant for property tax refund purposes. S.F. 150, authored by Sen. Don Betzold (DFL-Fridley), authorizes local government units to use special levies to pay for increases in the cost of health insurance coverage for employees. S.F. 1374, sponsored by Sen. Charles "Chuck" Wiger (DFL-North St. Paul), requires the separate statement of Ramsey County Library levies on proposed property tax notices and property tax statements.
Members heard two measures that will not be in the bill. S.F. 368, sponsored by Rest, provides a reduced property tax classification rate for unimproved property bordering public waters and specifies covenant agreement requirements. S.F. 1421, authored by Langseth, reinstates authorization to levy for transit purposes and provides for additional means of financing transit.
S.F. 361, sponsored by Sen. Gary Kubly (DFL-Granite Falls), provides for economic growth in rural counties of the state by allowing credit against the income tax of an employer for the creation and retention of qualifying jobs. Under the bill, qualifying job means a job in an industry that produces goods or services that bring outside wealth into an eligible county. Further, the bill specifies that at a minimum, a qualifying job must provide full-time employment and pay at least $12 per hour or $10 per hour, plus health insurance benefits. The bill specifies that a qualifying county is one in which the net new job growth between 1991 and 2001 was at a rate of less than 15.6 percent or a county that has a population of less than 15,000. S.F. 367, carried by Sen. Dallas Sams (DFL-Staples), is also aimed at spurring economic development in Greater Minnesota. The bill provides for a tax credit for investment in a qualifying regional angel investment network fund.
S.F. 458, sponsored by Sen. Julie Rosen (R-Fairmont), provides for a subtraction for military income. The bill specifies that the first $10,000 of compensation received by a veteran who is disabled or 65 years of age or older from a pension or other retirement pay from the government for service in the armed forces.
S.F. 1310, carried by Sen. Mee Moua (DFL-St. Paul), authorizes the sale of tax liens. Under the bill, a taxing authority may sell its allocable portion of tax liens securing delinquent real property taxes and assessments or other charges that are made a lien on real property for the benefit of the taxing authority.
Members also considered a number of bills setting local sales and use taxes. S.F. 168, sponsored by Sen. Carrie Ruud (R-Breezy Point), provides for a Bemidji sales and use tax the proceeds of which are to be used for parks and trails within the city. S.F. 528, carried by Sen. Yvonne Solon (DFL-Duluth), expands the use of the Duluth sales tax proceeds to include debt service for bonds issued for improvements to the Duluth Entertainment and Convention Center and to pay the debt service on bonds issued to finance improvements to the Great Lake Aquarium.
S.F. 559, carried by Sen. Tom Saxhaug (DFL-Grand Rapids), allows Itasca County to impose the local lodging tax and prohibits municipalities located within the county from imposing a separate tax.
Sen. Thomas Bakk (DFL-Cook) sponsored three measures. S.F. 573 authorizes the city of Proctor to impose an additional sales and use tax in order to fund construction and improvements of city streets, public utilities, sidewalks, bikeways and trails. S.F. 1003 authorizes Beaver Bay to impose additional sales and use tax to pay the bonded indebtedness on the city community building and to provide funding for recreational facilities, the upgrading of the water and sewer system, the upgrading and replacement of fire equipment and the improvement of streets. S.F. 1360 expands the uses of the revenue from the Hermantown tax imposition.
S.F. 657, sponsored by Sen. Dick Day (R-Owatonna), authorizes the city of Medford to impose additional sales and use taxes to pay up to $5 million in costs related to improving the city's wastewater system and wastewater treatment plant. S.F. 742, carried by Sen. Rod Skoe (DFL-Clearbrook), authorizes the city of Park Rapids to impose additional sales and use taxes to pay for a variety of projects including a community center, park improvements and city storm and wastewater improvements. S.F. 852, carried by Sen. Steve Kelley (DFL-Hopkins), authorizes the city of Hopkins to impose a food and beverage tax to pay for expenses related to public art facilities, community or public arts projects of purchase or acquisition of art for public purposes. S.F. 961, authored by Sen. Becky Lourey (DFL-Kerrick), authorizes the city of Cloquet to impose an additional sales tax and provides bonding authority to pay for a variety of projects.
Members indicated that several bills will not be in the omnibus bill this year. S.F. 15, authored by Sen. Brian LeClair (R-Woodbury), increases the tax credit for long term care insurance. Currently, the credit is $100 for individual taxpayers; the bill provides for a $500 credit. S.F. 662, sponsored by Sen. Steve Murphy (DFL-Red Wing), also increases the tax credit for long term care insurance. The measure provides for a $250 credit for individual tax payers. S.F. 1226, carried by Day, provides for income tax checkoffs to provide additional funding for kindergarten through grade 12 education, health care, higher education, early childhood and family education and state parks.
Two measures sponsored by Sen. Michele Bachmann (R-Stillwater) will also probably not be included this year. S.F. 736 provides an income tax checkoff to fund benefits for survivors of law enforcement officers and firefighters and provides for maintenance of peace officer and firefighter memorials. S.F. 740 abolishes the estate tax.
S.F. 877, sponsored by Sen. Ann Rest (DFL-New Hope), provides for an exemption from sales and use taxes on delivery or distribution charges for direct mail. S.F. 530, carried by Sen. LeRoy Stumpf (DFL-Thief River Falls), provides for the application of sales tax to sales of prefabricated homes. S.F. 809, sponsored by Sen. Linda Higgins (DFL-Mpls.), provides for a separate excise tax for dairy mixed cocktails. S.F. 438, carried by Pogemiller, allows vehicle dealers to pay sales tax or use tax for use of a vehicle other than for demonstration purposes and exempts loaner vehicles from motor vehicle sales tax and use tax. All of the measures were laid over for possible inclusion in the omnibus bill.
The committee also considered several measures for possible inclusion in an omnibus tax increment financing bill. S.F. 338, authored by Sen. Satveer Chaudhary (DFL-Fridley), establishes a multicity housing authority including the cities of Arden Hills, Blaine, Circle Pines, Mounds View, New Brighton, Roseville and Shoreview. S.F. 547, sponsored by Sen. Don Betzold (DFL-Fridley), authorizes counties in the seven-county Metropolitan Area to grant economic development authority powers to existing county housing and redevelopment authorities. S.F. 49, authored by Sen. Dean Johnson (DFL-Willmar), authorizes Kandiyohi County to exercise the powers of a city for the purposes of establishing an economic development authority and permits the joint exercise of powers by Kandiyohi County and the city of Willmar.
Members also considered two additional bills. S.F. 635, sponsored by Sen. William Belanger (R-Bloomington) abolishes the Metropolitan Fiscal Disparities Act. S.F. 1141, sponsored by Pogemiller, regulates the transportation of cigarettes for sale out of state.
The committee advanced one bill to the Rules and Administration Committee. S.F. 232, authored by Sen. Steve Kelley (DFL-Hopkins), is a resolution memorializing Congress to require Internet sellers to collect state and local taxes.
S.F. 151, carried by Sen. Dallas Sams (DFL-Staples), creates the Lakes Area Economic Development Authority (EDA) in Douglas County. Sen. Ann Rest (DFL-New Hope) sponsored two measures. S.F. 306 provides for the creation of a tax increment financing (TIF) district in New Hope. S.F. 1229 authorizes development authorities to amend TIF plans to establish affordable housing or hazardous substance remediation accounts. S.F. 387, authored by Sen. Mee Moua (DFL-St. Paul), authorizes the St. Paul Housing and Redevelopment Authority to establish several TIF districts in St. Paul. S.F. 393, carried by Sen. Steve Murphy (DFL-Red Wing), permits the city of Red Wing to extend the duration of several TIF districts.
Sen. Yvonne Solon (DFL-Duluth) carried two bills relating to the Duluth EDA. S.F. 525 permits the establishment of a TIF district for aircraft-related facilities and S.F. 526 permits the expenditure of tax increments collected from a TIF district outside the district's boundaries. S.F. 446, sponsored by Sen. Keith Langseth (DFL-Glyndon), permits the city of Detroit Lakes to pool tax increments for debt service payments. Sen. Steve Kelley (DFL-Hopkins) authored two measures. S.F. 617 and S.F. 1209 extend the durations of TIF districts in Hopkins and Golden Valley, respectively. S.F. 783, sponsored by Sen. Gary Kubly (DFL-Granite Falls), authorizes development authorities to extend the duration of TIF districts to eliminate deficits caused by property tax changes enacted in 2001.
S.F. 830, authored by Sen. Mark Ourada (R-Buffalo), authorizes the creation of a TIF district in St. Michael. Ourada also carried S.F. 1174, which extends the duration of a TIF district in Monticello. S.F. 1190, sponsored by Sen. Mady Reiter (R-Shoreview), extends the duration of a TIF district in Circle Pines. Pogemiller sponsored two measures, both relating to TIF districts in Roseville. S.F. 1109 extends the duration of a district and S.F. 1312 creates a TIF district.
Committee Chair Lawrence Pogemiller (DFL-Mpls.) said the other body set the same percentages in its resolution, but differed on the division of state and local services. The Senate version sets the state share at 63 percent, while the other body set the state share at 62 percent. Pogemiller said the higher state figure reflects a commitment to keeping property taxes down.
The second resolution establishes the maximum limit on general fund revenues and general fund spending for FY 04-05. The resolution sets a limit on general fund revenues of $28.383 billion and requires at budget reserve account of at least $530 million. Director of Senate Fiscal Policy Analysis Mark Misukanis said the current law forecast for revenues is $26.683 billion. He said extra revenue is reflected by the governor's proposals to transfer the entire balance of the tobacco endowment, to increase certain fees, to delay the buyback of June sales tax acceleration and to shift money from the health care access fund. The resolution advanced to the Finance Committee.
S.F. 167, sponsored by Sen. Carrie Ruud (R-Breezy Point), increases the amount of revenue from tax-forfeited lands that may be spent by Beltrami County for the promotion of tourist, agricultural and industrial developments. The current limit is $1 per capita; the bill raises the limit to $5 per capita. Beltrami County Administrator Tony Murphy said the county does not intend to raise its spending to the new limit immediately, but wanted the limit raised enough to avoid returning for another limit increase soon. Senators Julianne Ortman (R-Chanhassen) and Steve Murphy (DFL-Red Wing) suggested the limit be removed entirely to give the county as much flexibility as it needs. However, said Sen. Rod Skoe (DFL-Clearbrook), other units of government, including school districts, have statutory access to revenues from the tax-forfeited land and would thus be harmed by giving the county access to all of the money. The bill was approved for inclusion in the omnibus bill.
Sen. Mady Reiter (R-Shoreview) carried S.F. 46, which exempts local units of governments from paying sales or use taxes. Reiter said she carried a similar bill last session, but it did not make it into law. The timing for the exemption, she said, is also questionable with the state's sizable budget shortfall. Reiter noted that the Dept. of Revenue analysis suggests the bill reduces state revenues by almost $200 million in FY 04-05. However, she said, local units of government were exempted from paying the sales tax until the last state budget shortfall. At that time, more than 10 years ago, local governments agreed to pay the tax temporarily, Reiter said. Jennifer O'Rourke, League of Minnesota Cities, and Roger Peterson, Association of Metropolitan Municipalities, spoke in support of the bill. Peterson said it is not good public policy to levy a property tax to pay sales taxes. However, Committee Chair Lawrence Pogemiller (DFL-Mpls.) said the real cost of services, including taxes, should be built in to provide a level market, especially as more cities are delivering services with a mix of public and private agencies. Sen. William Belanger (R-Bloomington), ranking minority member of the panel, said that no one should believe that local taxes will actually go down if the bill becomes law. No action was taken on S.F. 46.
The bill was originally introduced as a rate freeze. However, Sen. Lawrence Pogemiller (DFL-Mpls.), chief author, offered an amendment changing the bill to a levy freeze. The amendment was adopted by the committee on a voice vote.
Eric Nauman, fiscal analyst, presented a spreadsheet showing the levies projected under current law. Under the bill, he said, about $470 million of levy increases will not occur in 2004 and 2005. Sen. Julianne Ortman (R-Chanhassen) said the bill seems to reward those districts that recently sought, and received voter approval for, levy increases. She said the effects of the bill fall disproportionately on districts that chose to wait on referendum levy increases. Nauman said that any legislative limits on levies will have differing effects on districts that recently approved new levies and those that did not do so. However, he said, the bill affects all districts by limiting them to their 2003 revenues.
Sen. Warren Limmer (R-Maple Grove) noted that a fiscal note prepared by the Dept. of Revenue indicates the bill will remove over $4 million in revenue from the general fund during FY 04-05 and over $34 million in revenue from the general fund in FY 06-07. He said it may be better to maintain the revenue the state has than to chip away at existing revenue streams. Pogemiller said his goal was to enact a tax freeze. A freeze on taxes for individual parcels would be better, he said, but a levy freeze is the closest, practicable alternative.
The Minnesota Chamber of Commerce appreciates the amendment, said Bill Blazar, since a levy freeze reduces taxes on business while a rate freeze actually increases businesses' property taxes. However, Blazar said, the chamber wants to hear all the proposals, including the governor's plan, which has not been released.
Several representatives of schools spoke against the measure. Bob Meeks said the Minnesota School Board Association supports allowing local electorates, if they choose, to provide additional revenue for schools. Brad Lundell, Schools for Equity in Education, said many districts are preparing referendum proposals. Levies will be more crucial, he said, as the state faces tighter budgetary times. Mary Gilbert and James Grathwol, representing the St. Paul and Minneapolis School Districts, respectively, said districts should have a variety of funding options.
S.F. 330 was sent to the full Senate on a 7-6 roll call vote.
Pogemiller said the amendment was a product of realizing that freezing rates does not freeze taxes. Sen. Don Betzold (DFL-Fridley) said that in rapidly growing areas, a frozen levy might mean lower taxes for individual taxpayers. Sen. Rod Skoe (DFL-Clearbrook) said that, conversely, taxpayers living in an area of shrinking population might see a higher tax burden. Pogemiller said there are many possibilities and that individual taxpayers already see fluctuations in their tax burden as conditions change in the taxing jurisdiction.
However, he suggested that the committee could consider how individual taxpayers interpret tax freeze promises. Gordon Folkman, director of research for the Dept. of Revenue, said there are challenges to a hard freeze, including that jurisdictions will not be able to capture natural growth in property values or the addition of newly developed or improved properties. A freeze on the taxes paid by individual parcels, he said, would be very tricky to accomplish.
Gary Carlson, League of Minnesota Cities, said rapidly growing areas will suffer under a levy freeze because they will need to provide increased services but will be constrained in their revenue. Jurisdictions that have recently undergone boundary adjustments, such as consolidation or annexation, he said, will also pose special challenges. Carlson said many cities are also dealing with the impacts of tax reforms enacted in 2001 and are considering levies to cover general obligation debt for tax increment financing districts.
No action was taken on the bill.
Pogemiller, who also chairs the committee, said a fiscal note on the bill highlighted the fact that freezing tax rates is not the same as freezing taxes. He said it is his intention to craft an amendment to the bill that accomplishes a tax freeze. The bill is meant to dovetail with the governor's oft repeated no new taxes pledge, Pogemiller said. He said the pledge should apply not only to state revenue sources, such as income and sales taxes, but also to property taxes. Commissioner of Revenue Dan Salomone said the governor's pledge does not reach to property taxes, but that the administration encourages local governments to enact reforms and adjust their budgets.
Committee staff fielded questions from Senators about the details of the proposal. Fiscal analyst Eric Nauman said the bill requires local governments to absorb the costs of retirement and severance into their operating budgets. Under current law, local units can increase levies to cover those costs. Nauman also briefly reviewed which levies were permissive and which were required. Some levies, he noted, are required if the unit requests state aid. The only truly required levy, Nauman said, is the statutory operating debt levy.
Representatives of several organizations testified on the bill. Keith Carlson, Metropolitan Inter County Association, said a tax rate freeze is consistent with the governor's pledge. Carlson said state revenues are actually growing, without tax increases, because government can take advantage of natural growth in the tax base. However, he said, a goal of freezing revenues will leave local governments with no increase while state government enjoys a 10 percent increase from FY 02-03 to FY 04-05. Regardless of any levy limit or tax freeze, he said, cuts at the county level will be substantial.
Curt Yoakum said the Association of Minnesota Counties agrees conceptually with the goal of avoiding property tax increases, but opposes a tax freeze. He noted that the level of micromanagement of county operations by the state increases every year. For some Greater Minnesota counties, Yoakum said, there are no funds for discretionary spending after mandates and levy limits are applied. He said the association has identified about 80 mandates for repeal or reform. Sen. William Belanger (R-Bloomington) said testimony from the counties indicates they may not be getting the message. The old way is not an option, he said, and local governments must find new ways to deliver services.
Members also heard from Kent Baldry, superintendent of the South St. Paul School District, and John Maas, business manager for the Mounds View School District, about the impact of preventing their districts from seeking additional levy authority from residents. Glenn Dorfman, representing the Minnesota Association of Realtors, said cities should be able to have control over both spending and taxing. Citizens will determine spending and taxing priorities for their own communities, he said.
According to the report, cities above the median in LGA per capita spend 42 percent more on total current expenditures than those below the median LGA per capita. Also, according to the report, the cities that receive the most LGA per capita appear to have enough resources to offer both essential and non-essential services at a level significantly above those cities that receive LGA per capita below the median.
Awada said Greater Minnesota cities receive the highest per capita amounts of LGA and those cities that receive the most LGA per capita have tax levies that are significantly lower than those that receive the lowest LGA. She also said one of the key findings is that the top quarter of cities ranked by LGA per capita are predominantly in Greater Minnesota and spend 35 percent on essential and over 3 times more on non-essential services than those cities ranked lowest in LGA per capita.
Awada also reviewed the conclusions in the report. She said LGA is supposed to ensure essential services for all cities, but not a high quality of life for just some cities. However, she said LGA cannot be totally eliminated without forcing deep cuts in essential services or large increase in local property taxes.
Several committee members questioned Awada on the definition of "essential" and "non-essential" services. Sen. David Tomassoni (DFL-Chisholm) said people might consider some services, such as libraries and public health, as being essential, but the report classified such services as non-essential. Awada said for purposes of the report, general government, public safety and streets and highways were grouped as essential services and all other services were grouped as non-essential services. Sen. John Marty (DFL-Roseville) said in this discussion, though, the definition drives the political debate.
Awada concluded her remarks by saying, "There is an appropriate role for LGA for cities that don't have economies of scale found in larger metropolitan areas, but still must provide essential services."
Members also heard from Jim Miller, representing the League of Minnesota Cities. Miller said, "The Office of the State Auditor is using a faulty methodology and suspect data to reach sweeping conclusions about the effectiveness of an important program." He also said the report's recommendations would have a crippling effect on the services and quality of life in many parts of the state. Duluth Mayor Gary Doty also took issue with the report. He said, "It would be a disaster if the recommendations were carried out. Cities need to be part of the solution to the budget crisis, but should not be a disproportionate part." Karen Anderson, mayor of Minnetonka and current president of the National League of Cities, said one of the unique aspects of local government in Minnesota is the willingness of city governments to form partnerships with other units of government.
Committee Chair Lawrence Pogemiller (DFL-Mpls.) concluded the hearing and said the issue would continue to be discussed throughout the session.
The committee recommended confirmation of the appointments of Kathleen Hvass Sanberg and Sheryl Ramstad as judges to the Tax Court. In addition, the panel approved the appointment of Daniel Salomone as commissioner of the Dept. of Revenue.
A bill to alter the valuation of small, seasonal resort properties that include the homestead of the owner was also discussed by the committee. Chief author of the bill, Sen. Dallas Sams (DFL-Staples), said the measure, S.F. 322, relieves the tax burden on small, family owned resorts by providing that the value be based on the use of the property as a resort, rather than on the market value. Sen. Carrie Ruud (R-Breezy Point), a co-author of the bill, said the measure is important to preserve and protect small resorts for the benefit of families.
Joel Carlson, speaking in support of the bill said there has been a rapid growth in demand and land values for residential lakeshore, which has made the financial operation of a small resort extremely difficult. The bill aids small resorts by allowing a lower valuation on the property. Sams added that if the resort is sold, the bill allows for revenue recapture.
No formal action was taken on the measure. Pogemiller said the bill would be set aside for consideration in the committee's omnibus bill.
In other action, members discussed a proposed list of objectives for the committee presented by Pogemiller. The list set forth a goal statement and then a series of objectives under which bills before the committee would be classified. Sen. William Belanger (R-Bloomington), lead Republican member of the panel, said the committee members from his caucus did not want to participate in the setting of the objectives. "No other committees have a list of objectives and we want to be able to vote bills up or down," Belanger said.
Sen. Mee Moua (DFL-St. Paul) countered, "It is good to be able to communicate to citizens our goals and objectives. I think it is important to be able to communicate the basis of our decisions."
Sen. Julianne Ortman (R-Chanhassen) also spoke against setting objectives. "I appreciate the process of setting the objectives-and it will be valuable-but I don't think there should be filters that eliminate bills from consideration." Sen. David Tomassoni (DFL-Chisholm) responded, "I think the chairman is trying to group the bills into priorities to make better decisions."
Pogemiller said he would lay the list aside, but "My experience is that a list of objectives informs the debate and helps members be more rigorous."
The objectives include maintaining a tax system consistent with the goals set forth in the state constitution, achieving horizontal and vertical equity in the tax system and promoting a clear, visible and understandable tax structure. The draft objectives also promote a tax system that allows government to anticipate revenue and taxpayers to predict the effect of taxation-at the state and local level-on their economic condition. Other objectives are a tax system that fosters government accountability, a progressive tax structure, a clear linkage between the taxing authority and benefit provided by government, an equalization between local governments and a stronger position for Minnesota to compete for business. A final draft objective is for targeted tax incentives to "demonstrate socially beneficial economic growth or development."
Sen. Julianne Ortman (R-Chanhassen) suggested two additional objectives: no bills increasing taxes and hearing every tax-related bill introduced. "I don't anticipate any bills to increase taxes this year," Pogemiller said. He said that the reality was that tax increases are not likely this session, but that he personally supports increased revenue to support schools. Pogemiller said not raising taxes was not one of his personal objectives. Procedurally, however, Pogemiller said that every bill introduced should be heard and voted on by the committee. "If it is good enough to use paper, and spend the taxpayers' money," he said, "it is good enough to be heard and voted on in this committee."
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