Dayton vetoes school shift plan

/ 6 April 2012 / jennifer

Erin Schmidtke, Session Weekly, April 6, 2012 –

Gov. Mark Dayton vetoed a contentious bill April 5 that seeks to repay money owed to the schools.

Education funding was withheld by the state to balance its budget and help end the 2011 state government shutdown. Lawmakers agree that money must go back to the schools, but have different ideas on where it should come from.

Both bodies passed the bill April 2; the House 75-56 and the Senate 35-28. Rep. Pat Garofalo (R-Farmington) and Sen. Gen Olson (R-Minnetrista) sponsor the bill.

Following the February budget forecast, the state owes $1.8 billion in aid payment. The bill sought to repay $430 million of that, leaving $1.5 billion in aid still owed to schools. The state also owes $550 million in property tax shift, which the bill did not address.

The repayment plan divided members of the House because it would draw from the $1 billion the state is expected to have in reserve. Republicans praised the bill because it pays off the debt with existing money. DFLers accused the majority of political posturing by attempting to drain the account the state uses for fiscal emergencies.

Dayton echoed that concern in his veto letter. He cited data from Minnesota Management & Budget, which anticipates a difficult fiscal year 2013 for the state.

“Raising the reserve fund would put the State’s newly-achieved fiscal stability at unacceptable risk … Just getting out of a deep budgetary hole is no reason to cut corners now,” Dayton wrote.

He acknowledged that the proposed plan “has superficial appeal,” but supports another plan DFLers unsuccessfully offered during the bill’s floor debate. As an alternative to tapping the reserve fund to repay schools, the minority caucus had previously proposed a tax increase for corporations who keep money in overseas accounts.

HF2083*/ SF2492/CH154