Marshall Area Chamber of Commerce Legislative Update w January 26, 2007

Governor Pawlenty presented his two-year budget proposal earlier this week. Overall, the plan calls for no new taxes,
and more funding for roads, schools, health care, and property tax relief. The budget would increase state spending by nearly $3 billion, a 9.3 percent increase, to be financed through growth in state revenue.
The eventual two-year budget that will be passed in late May will more than likely be larger than the $34.3 billion proposed by Pawlenty. Yet, the Governor's plan sets the stage for serious debate
of the next budget, with the next milestone coming at the end of February when the
economic forecast will cause Legislators to fine-tune their revenue projections.

Watch for Legislative Updates from the Marshall Area Chamber of Commerce every other week
during the session to help you stay connected with what's happening at the Capitol.

Health Care
The Governor's budget includes money for funding improvements for electronic medical records and offers to pay providers on the basis of quality. Talk at the Legislature continues to focus on improving access, with the House focus on covering all kids, while the Senate is looking more towards universal coverage for all Minnesotans. A constitutional amendment has been proposed in the Senate that would guarantee comprehensive, affordable health care for all Minnesotans, but is silent on the details of what that would entail, or who will pay for such coverage. The House has introduced legislation that would exempt all generic and brand-name prescription drugs from the state's predatory pricing law, which prohibits the sale of items below cost. The bill would allow pharmacies to price about 50 generic drugs at $4 each, but could harm small-town drug stores that cannot compete with large retailers.

Education
The Governor's spends the largest portion of his budget on education. K-12 would receive the largest chunk of money, with funding tied to results. Business is interested in a well-trained and well-prepared workforce. Education Commissioner Alice Seagren spoke to MACC members earlier today, and shared additional information about Pawlenty's plan for education. Click here to download more information on the Governor's intiatives.

Privacy
HF131 would place additional restrictions on the use of Social Security numbers to help reduce identity theft. Unfortunately, the bill could have some unintended consequences, including making it more difficult to process workers comp claims, and making it more difficult to transfer funds between accounts at different financial institutions.

Taxes
Governor Pawlenty recommended accelerating the sales-only apportionment for corporate income taxes by three years, taking effect in 2011 instead of 2014. This law was originally passed in 2005, and bases corporate income tax on a percentage of the company's sales to Minnesota customers, and provides an incentive for companies to expand in Minnesota while selling globally. His proposals also call for converting the capital equipment sales-tax refund program to an up-front exemption for small businesses with sales under $1M or with fewer than 20 employees.

Session Weekly magazine offered free
A free magazine, Session Weekly, from the House can help to keep you up-to-date on bill introductions, in depth stories and more. To subscribe, visit www.house.mn/hinfo/subscribesw.asp, or call toll-free 1-800-657-3550.

Transportation
HF 18 / SF 48 would allocate the distribution of the motor vehicle sales tax between highway and transit projects 60 % to highways and 40 percent to transit. Discussion continues over further breakdown of the transit funding between metro and out-state interests. HF 23 /SF5 presents a long-term funding package to includes multiple tax and fee increases, such as a wheelage tax, 10-cent gas tax, and a half-cent metro sales tax, called a "Cadillac plan" by many. The Governor also proposed $1.7 billion in transportation bonding projects.

Environment
Clean Water Legacy would be funded with $20 million from the general fund according to Pawlenty's proposal. Start up funding was passed by the Legislature in 2006, but the Minnesota Pollution Control Agency estimates that it will take $80 million annually for at least the next 10 years to clean up Minnesota's "impaired waters". This is crucial to Minnesota business as discharge permits will be denied for new and expanding businesses unless a clean-up plan is in place. The Ewaste issue continues to be discussed, and the House introduced a manufacturer's responsibility model that has the support of retailers, county government and the MPCA.

Energy
The House and Senate seen to be on separate tracks on three energy issues, including renewable energy, conservation and efficiency and global warming.

Statewide Smoking Ban introduced
This long anticipated bill was introduced and will be heard next week in the House. Insiders indicate it is likely to pass in the Senate but have some problems in the House, but Governor Pawlenty has said that he would sign the bill if it makes it to his desk.

Labor and Management
The US House of Representatives passed a $2.10 increase in the minimum wage. The Senate moved to a bill that would increase the minimum wage to $7.25 an hour over 26 months and provide $8.3 billion in offsetting tax breaks. In the meantime, in Minnesota, HF 91 would increase minimum wage for large employers from $6.15 per hour to $7.95 effective on August 1, with the wage rate indexed to inflation annually. Wages paid by small employers would increase to $7.50 an hour at the same time. A debate will continue over keeping the state's wages in line with federal levels.

Sign-up for Seifert emails
Representative Marty Seifert provides weekly emails for his constituents. To sign up to receive the free updates, visit
www.house.leg.state.mu.us/members/join.asp?district=21A.

Conference Call series starts - Just a reminder that our conference call series is free to federation partners. The Minnesota Chamber hosts 8 conference calls with local chambers during the Legislative Session. Our policy staff gives a quick, up to the minute status report of action at the Capitol and we also provide ample time for questions and input from you and your volunteers. Many local chambers host their government affairs committee meetings in conjunction with the calls The calls run from 7:30 – 8:00 a.m. on the following Fridays: Jan 26; Feb 19; Mar 9 & 30; April 20; May 4, 11 & 18.

Business Day at the Capitol set for March 14
Join us in discussing your business priorities face to face with legislators state-wide on Wednesday, March 14. The Marshall Leadership Academy will attend, and we hope to have a large contingent of Marshall area business leaders participate as well. Watch for more details, or call the Chamber at 532-4484 to indicate your interest!

The Bottom Line on Health Care

By Thomas J. Donohue, President and CEO, U.S. Chamber of Commerce
January 23, 2007

The old saying "if you don't like the weather in Chicago, just wait five minutes and it will change" is now applicable to health care policy. If you don't like the latest proposal from the president or the physicians association, wait a few minutes and another one will pop up.

In the last week or so, President Bush, Sen. Hillary Clinton, Sen. Ted Kennedy, Gov. Arnold Schwarzenegger, Rep. John Conyers, the American College of Physicians, a handful of coalitions, and a slew of state officials have all unveiled their own proposals, ranging from mandating universal health care to changing tax incentives to plans for covering the uninsured.

What are we to make of all of this? First, health care is an extremely challenging and complex issue. Second, there is no silver bullet solution--if there were, we would have discovered it by now and quickly implemented it. Third, unable to affect change individually, politicians, trade associations, and companies have banded together in coalitions to leverage their political power and draw more attention to their proposals.

The Chamber is a central player in the health care debate. We have backed specific proposals we think will help, such as expanding health savings accounts, creating small business health plans, curbing frivolous medical liability lawsuits, and encouraging the use of technology to improve care and reduce costs, to name a few. In addition, we've joined coalitions when it makes sense for us to do so. For example, we have worked for two years as a part of the Health Coverage Coalition for the Uninsured and support a mix of public and private sector solutions to expand health care coverage to a significant portion of America's 47 million uninsured.

In a world of competing interests, proposals, and viewpoints, where proposals fall from the sky like snowflakes during a blizzard, and when each might have a single idea we could endorse, how does the Chamber move forward on health care? Here is the bottom line--we will support proposals that meet our fundamental criteria for reform. Those criteria are: Do they strengthen the successful employer-provided system that currently insures 136 million people, or does it begin to weaken and dismantle it? Does it employ market-based approaches that allow for flexibility and innovation, or is it one-size-fits-all mandate that will do more harm than good? And finally, does it make sense, is it cost effective, and does it have a reasonable chance of succeeding?

Forging consensus on health care solutions and mustering the political will to implement those solutions will be a difficult and time-consuming challenge. But it helps when you have a prism from which you can separate the good from the bad, and apply all of your resources to advancing the good.

Information from the Minnesota Chamber of Commerce, Minnesota Retailers Association, Representative Marty Seifert's Update, The Political Insider, BIPAC, the US Chamber of Commerce.
This Legislative Update is intended to be informational only.

Looking for Internet links to the Legislature, state agencies and Federal resources as well? Visit www.marshall-mn.org, and follow the "Government" links, or click here!.

Back To Staff Information