5-18-05 For Immediate Release
Jim Moore, State Party Chair - (612) 306-6563
Laura Knudsen, Public Relations Chair - (651) 283-1166

How do we measure a successful legislative session?

GUIDELINES

1. Do no further harm.
2. Stop spending more for less.
3. End the “trickle down” budget shifts.
4. Stop playing groups of Minnesotans against each other.  We are all in this together. 
5. Elected officials cannot lead by managing in an environment of perpetual crises.  It is time for bold and creative leadership.

BACKGROUND

Successes to date:

1. Finally passed a bonding bill.  Curiously, it’s the same as the highest proposal rejected last year, $945 million.  This year, inflation added 5% to the cost for virtually the same projects.  Additionally, bonding interest rates go up from 4.02% to 4.21% ($1.8 million in additional interest per year)

KEY MEASURES OF SUCCESS

Honestly balance the budget.  End the Fiscal Mismanagement

• No more gimmicks and games.
• No more raiding one time reserves, like the tobacco settlement fund, to plug structural shortfalls.
• No more shifting expenses to the next biennium.  The next biennium projects increased tax revenues of 8% ($2 billion) all but 2% is covering spending from the last biennium.  That’s enough to fund all the desired investments proposed during this session. 
• Recognize inflation in spending forecasts.
• Former Finance Commissioner John Gunyou points out that two years ago, 31 states were dealing with deficits, this year, there are only 3 and Minnesota is one of them.
• If our governor and legislature were managing a public company, their shenanigans used to hide the real problems would have led to multiple class action lawsuits resulting from their misrepresentations.

 Preserve Minnesota’s leadership in education and educational innovation.

• Test Pawlenty’s teacher incentive pay proposal.  It’s a good proposal and worth trying in the spirit of Minnesota educational innovation. 
• Continue to promote public school choice and charter schools
• Evaluate whether we should conform to the standards of No Child Left Behind if there is no corresponding money to support it.  Why should a state that consistently leads the nation in educational results submit to an under funded mandate that originated in a state, Texas, that ranks 49^th.
• Fund the structural budget hole that wasn’t funded when the landmark property tax reform was enacted.

 Preserve medical access to the most efficient health care delivery systems

• Preserve Minncare.  This program is not welfare, it’s a necessary hand extended to our working poor. 
• This program prevents the use of more inefficient health care resources such as county hospital emergency rooms.
• When we push the medical costs out of Minncare, they inevitably will pop up in increased county tax burdens, increased Medicaid costs and more disturbingly in increased cost shifts to private medical insurance beneficiaries. 
• Senator Kiscaden introduced legislation that truly addresses the causes of spiraling health care costs:

• SF 1796 establishing a State Health Care Purchasing Authority to consolidate the 16 units of government responsible for health care decisions into one.    
• SF 1641 establishing “evidence base health care guidelines”
• SF 1638 which leads the state toward universal health care coverage delivered by the private sector.
• SF 1639 which seeks to establish a loan program to assist health care providers install an interoperable electronic medical record system.

Keep Minnesota politics as clean as possible

• There are only two forms of clean money remaining in politics: individual donations and public subsidies.
• For a relatively small investment of $5 million a year, our PCR program, tax check-off program and $1.5 million state subsidy are the last barriers keeping Washington style smear campaigns from taking over Minnesota elections.
• If special interests are successful in purchasing the governor’s office, you can be sure that they will invest enough money to buy sufficient legislative seats to ensure their governor’s agenda is implemented.
• We risk losing our tradition of electing independent thinking leaders.

 End transportation gridlock

• Discussion may be over this session but the gas tax debate my have revived it.
• Minnesotans are tired of traffic congestion.

Preserve Gov. Ventura’s landmark property tax/sales tax reform and educational funding shift.

• Average property tax reductions of 15.6%...as high as 31% for apartment buildings and their tenants.
• Shifted $900 million in school funding to the state without infringing upon local control.
• Paid for by an expansion of the sales tax to cover services while continuing to exempt food and clothing.  Overall sales tax rate reduced from 6.5% to 6%.  Former Finance Commissioner John Gunyou has stated that such a funding source for education is more reliable than income tax revenues due to the volatility in capital gains.
• The legislature, led by gubernatorial candidates Tim Pawlenty and Roger Moe, took the property tax reform without implementing the corresponding, revenue neutral sales tax reform to ensure the educational commitment was properly funded. ($1.086 billion in the 2004-2005 biennium).  This would have funded the structural budget hole.
• Instead this structural deficit was financed with one time money, primarily the tobacco settlement.
• We now risk the complete reversal of this reform. If this occurs, it becomes a new tax on businesses, fixed income homeowners, and renters

How do we fund our priorities?

• Go back and finish the Ventura reform.  It was revenue neutral then and allows Pawlenty to maintain his tax pledge.   This can be introduced in the inevitable special session. 
• If the GOP and DFL insist on a battle between their respective plans, I would suggest a meld of the two: 
• The Senate should reduce its proposed temporary income tax increase and expand it across all income brackets.  We are all in this together  
• The governor and the house can return to his focus on streamlining government and squeezing efficiencies out of current programs.
• As we approach the 2006 elections we’ll see if the two factions have been forthright.  Will the DFL be in a position to allow the income tax increase to sunset? Will the GOP step up and show real savings in making government spending more efficient?
• The structural deficit of $1 billion can only be filled by returning to complete the full scope of Gov. Ventura’s property/sales tax reform.

Summary

• The governor is fond of saying we have a spending problem not a revenue problem yet he continues to look for new sources of revenue.  Gambling, reestablishing liquor and car rental taxes, etc.  His actions belie his words.
• Can he juggle this without raising taxes?  Perhaps, but governing through a crisis that he helped to create continues to limit his options.  We can’t get out of the education business, the transportation business or health care business and that’s where the majority of our spending goes.
• The House/governor budget plan and the Senate budget plans have been described as slaps in the face of the opposing caucuses. 
• The Governor and many legislators are fond of taking swipes at Gov. Ventura’s tenure, yet they have failed to make it into his league when it comes to sound governance and looking to the future to build a stronger state for all Minnesotans.
• Now is the time for real leaders to step up.  True leadership involves taking on great challenges and leading the state to a better future. 
• If they are unable represent their constituents and their values within their own caucuses, the Independence Party will readily provide them with the vehicle to so.

Our elected officials need to ask themselves what they want their legacy to be.