Minnesota Legislature tests governor's resolve with tax bill

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ST. PAUL, Minn. (AP) — Republicans who control the Minnesota Legislature are testing Gov. Mark Dayton's resolve with a bill that syncs Minnesota taxes with the federal overhaul.

The House passed the bill Tuesday on a 78-50 vote despite the Democratic governor's promise that he would block that legislation until lawmakers provide emergency funding for public schools. Most House Democrats voted against the bill.

The Senate was expected to follow suit Wednesday in approving the legislation.

Lawmakers have less than a week to finish their work, but Dayton and the GOP Legislature remain far apart on nearly every priority for the year. On Monday, Dayton told reporters that he wouldn't negotiate or sign a so-called tax conformity bill until the Legislature provides $138 million to 59 public school districts facing budget shortfalls.

But Republicans still lined up a sudden vote on their tax proposal that would match Minnesota's taxes with federal breaks passed by Congress while modestly cutting income tax rates.

"We'll get this bill to the governor and then we'll have to let him make his decision," said Rep. Greg Davids, the Republican House Taxes Committee chairman.

The Legislature faces a Sunday night deadline to finish passing bills. Dayton's ultimatum sought to pressure GOP lawmakers into providing the emergency school funding they had deemed unnecessary this year. Republicans' sudden move on taxes could force Dayton to the negotiating table, or tempt him to sign that legislation.

The tax bill tension comes at a time when uneasiness already is growing at the Capitol. With time winding down, none of the major priorities for the year — including a tax bill, money for school security upgrades, and efforts to curb opioid abuse and address widespread abuse in senior living facilities — have been sent to Dayton's desk.

The Legislature entered the session focused on taxes — tasked with avoiding a tax-filing nightmare during next year's season and ensuring hundreds of thousands of residents weren't hit with tax increases.

Sen. Roger Chamberlain, who chairs the Senate Taxes Committee, said the Legislature tried to move in the governor's direction by eliminating provisions that would exempt more wealthy estate owners from taxes and automatically trigger future income tax cuts during times of state budget surplus. But Dayton's top tax official, Revenue Commissioner Cynthia Bauerly, told lawmakers the administration was still concerned that the GOP proposal benefited wealthier taxpayers more than low- and middle-income families.

Dayton's proposal would redirect much of the new tax revenue to middle-income families with new tax credits, while leaving many businesses with a higher tax burden. With just days remaining in the session, the two sides haven't started meeting to work out their differences.

If the tax legislation passes the Senate, Dayton could get the bill as soon as Wednesday. A veto would leave just a few days to reach a compromise on taxes, government spending, a public works package and many other bills.


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