The Legislature did not fully complete its business, including the passage of omnibus tax and budget bills, by the constitutional deadline of May 22nd at midnight, and went into a special session that finally concluded early Friday morning. Following is a report regarding key legislative issues important to farmers:
The omnibus environmental and natural resources policy and finance bill was passed just before the close of the regular session. As amended, the bill would not delay implementation of the water buffer law, but farmers who file a compliance plan with their local soil and water conservation districts by the Nov. 1st deadline would receive a conditional compliance waiver until July 1, 2018.
The bill also clarifies that all public ditches are subject to the 16.5-foot buffer requirement. It also enables local soil and water conservation boards to approve alternative practices, and mandates that seeds used for buffers be free of Palmer Amaranth or other noxious weeds.
The House and Senate came to a final agreement on a tax bill, which they haven’t been able to do in recent years. Key provisions within the bill include a 40-percent credit on farm property taxes levied for school district bonding projects. The Minnesota Corn Growers Association (MCGA) worked very hard during the legislative session to explain the need for farm tax relief, and the Ag2School tax credit will save Minnesota farmers approximately $30 million over the next biennium.
The tax bill also increases the threshold for the state inheritance tax to $3 million, which will be helpful to farmers for estate planning purposes. Another provision will enable a portion of a person’s Social Security income to be excluded from income for state tax purposes.
The Legislature also passed the $5.9 billion, two-year transportation funding bill. It will shift $300 million from the state’s general fund dollars to pay for transportation projects. It also calls for borrowing $940 million over four years, spending $640 million on general state road construction and $300 million on the Corridors of Commerce program. The Corridors of Commerce was created by the Legislature in 2013 as a mechanism to focus funding on improvements to key trunk highways in the state that support economic activity. MCGA and many other ag organizations worked to make transportation a top priority during the 2017 session.
House members passed a $988 million bonding bill in the early morning hours on Friday and the Senate quickly followed suit. In addition to capital improvements to the state’s colleges and universities, the bonding bill will fund approximately $250 million in road and bridge projects and railroad crossings. Major bonding bills are typically passed during even-numbered years but the 2016 legislative session concluded without a formal bonding bill being approved.
AGRICULUTURAL FINANCE BILL
Following an initial veto by the Governor, conference committee members agreed to add approximately $5 million to the budget for the Minnesota Department of Agriculture’s (MDA) operations. In total, the agreement would appropriate $105.45 million for the Department of Agriculture, $10.87 million for the Board of Animal Health and $7.59 million for the Agricultural Utilization Research Institute. Legislators removed earmarks in the AGRI funds, which was a concern for the Governor and MDA. The bill also limits how far MDA can go with verification of need for pesticide given the executive order the Governor issued last summer.
During the first weeks of the 2017 session, the Legislature and Governor approved spending $326 million to help reduce the rapidly-rising cost of health insurance premiums for individual policies obtained through the private market exchange. The law also enables farmers to form health care cooperatives, which can further benefit farm families.
In March, both the Senate and House passed a reinsurance plan, appropriating more than $540 million to help cover high-cost patients that have driven some insurance providers out of the state’s individual marketplace and premiums dramatically higher among those providers that have remained. The Governor decided to allow the bill to become law without his signature, expressing concern about using money from the MinnesotaCare program and the state’s general fund to implement the reinsurance plan rather than taxing insurance plans to pay for it.
Now that the Legislature has adjourned, Gov. Dayton has 14 days to sign, veto or allow measures to become law without his signature. Lawmakers are scheduled to convene the next legislative session on Feb. 20, 2018.