Yesterday all Minnesotans received good news from Minnesota’s Office of Management and Budget. The February budget forecast showed that Minnesota is in better fiscal shape than it was at the time of the November 2012 forecast. Two years ago at this time we faced a $5.1 billion deficit, currently we face a projected $627 million deficit. Over the last two years, the Republican legislature refused to raise taxes despite Governor Dayton’s continued drumbeat to “tax the rich.” He insisted that in the absence of tax increases Minnesota’s economy would falter and we would be stuck with state budget problems into the future. In fact, our economy is improving, tax revenues are up, and demand for government services is down. We have proved that a thriving economy will help everyone and provide enough tax revenue to fund core functions of government. I can only hope that Governor Dayton and DFL legislators give up the plan to tax all Minnesotans just so they can grow government. We need to invest in people, not bigger government.




S.F. 1 - Minnesota Insurance Marketplace Act (known as the Healthcare Exchange) is scheduled to be heard on the House floor Monday and the Senate floor Thursday. I have stated in previous updates my reasons for opposing this legislation.

A special joint meeting of the House and Senate Higher Education Committees heard from several candidates for the University of Minnesota Board of Regents, which has four upcoming openings to fill. The role of the Joint Committee is to interview and endorse a single candidate for each opening. This endorsement will ensure the candidate’s automatic nomination when all 201 members of the House and Senate convene on March 6th to vote for the new Regents, but it does not preclude additional nominations from being made. The Board consists of 12 members, at least one from each Congressional district and at least one must be a student. Each Regent is appointed for a six-year term and serves as an unpaid volunteer. The Joint Committee results are as follows: Humphrey School graduate student Abdul Omari, born and raised in Minneapolis, was selected to fill the at-large student opening. Two at-large incumbents were chosen to continue their service on the Board for another term. Winning on the first round of voting was Dean Johnson, a Lutheran pastor, Brigadier General in the U.S. Army National Guard, and former state Representative and Senator who switched from Republican to DFL while in office. In a slightly tighter vote, Linda Cohen was chosen. Cohen is the current Regent Board Chair, a UMN graduate who has a Ph.D. in educational psychology, and a member of the Wayzata School Board. The runner-up candidate was Belle Plaine School District Superintendent Kelly Smith. Lastly, the Regent chosen for the 5th Congressional District, Peggy Lucas, emerged only after a series of votes had been taken with the House majority initially backing Dennis Nguyen. Lucas has a background in community housing development and runner-up Nguyen is an international businessman.

The Senate Tax Reform Committee began a series of hearings on Governor Dayton's tax proposal. This week, committee members took a closer look at the governor's proposal to increase the cigarette tax by 94 cents per pack. The governor's $370 million tax increase would go to the General Fund to support overall spending. Proponents of higher cigarette taxes frequently point to their focus of fighting the harmful health impacts of smoking, especially on youth. Using Department of Revenue's estimates, they cite the evidence that increasing taxes and the price of tobacco products causes a direct drop in consumption, encouraging many to pursue "quit smoking" options. Opponents of these tax hikes acknowledge the health goals, but contend there's ample evidence cigarette taxes are a poor choice to raise revenue. Cigarette taxes are among the most "regressive,” disproportionately impacting lower income consumers. In several states that have passed cigarette tax hikes, revenue has fallen far short of expectations. When added to other tax increases proposed by the governor, notably $2.1 billion in higher sales taxes, critics maintain Minnesota runs a further risk of becoming a high tax island.

www.senate.mn/SenatorThompson www.twitter.com/ThompsonSenate Sen.Dave.Thompson@senate.mn

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