Each would cost $100 million. He also announced Tuesday that he wants to supplement a $42 billion, two-year budget he and lawmakers enacted a year ago with $77 million to expand pre-kindergarten programs, $46 million to protect state government’s computer security, $56 million for state-run colleges and universities and $47 million to boost state funding to cities and counties. He could cut taxes $117 million.
With a $900 million state budget surplus, the Democratic governor would like to spend $411 million more for one-time expenses and increase ongoing spending $287 million. He also proposed increasing the state budget balance $202 million. Republicans say his priorities are out of place. They emphasize the need for bigger tax cuts than Dayton proposes. While he would earmark more money for other areas, he said that the most important items in his supplemental budget plan are to increase security in the troubled St.
Peter and Anoka state hospitals, as well as adding personnel to the Corrections Department. The governor said his top priority in writing his amended budget plan was to be “fiscally responsible.”
Dayton said he scaled back one of his favorite projects: implementing pre-kindergarten classes statewide. He reduced his ask from making it mandatory to allowing it to be voluntary in schools that desire expanding classes to 4-year-olds. Several things Dayton wanted to propose were reduced or eliminated when state officials learned last month that a budget surplus slipped from $1.2 billion to $900 million.
“The lower forecast was a warning shot across all of our bows,” he said.
The Coalition of Greater Minnesota Cities praised the Dayton budget plan, especially the proposal to pump $21.5 million into Local Government Aid cities receive.
“This is a shot in the arm for cities across the state,” said Le Sueur Mayor Robert Broeder, coalition president. “The governor is making a wise decision by choosing to invest some of the surplus money into programs like LGA that help keep our state healthy and poised for a bright future.”
Republicans were not impressed with the Dayton budget proposals. The governor said he sticks to his 2015 transportation plan, which includes a new gasoline tax. He wants to spend hundreds of millions of dollars more a year on transportation. Republicans, do, too, but would use existing taxes to fund it.
Dayton proposes a variety of tax cuts, such as for Minnesotans who use child care, but opposes business tax cuts that he said Republicans want.
“He is proposing spending about $7 for every $1 he is giving back in tax relief,” House Speaker Kurt Daudt, R-Crown, said, while the GOP wants much of the state’s budget surplus to be refunded via tax cuts. The speaker said Republicans propose a middle-class tax cut for 2 million Minnesotans, tax credit to help repay college loans and allowing Minnesotans to avoid paying taxes on Social Security benefits. Dayton said his tax cuts would benefit more than 400,000 Minnesotans.
He proposes allowing more than 126,000 families to get $5.7 million in tax cuts to make child care more affordable. The working family tax credit program would receive a $39.4 million injection. He also wants to add $5.7 million to a tax credit for education expenses. Commissioner Myron Frans of Minnesota Management and Budget said the Dayton plan would leave $2.5 billion unspent, the most in state history. The governor said a reserve is needed, especially now that economists predict a recession may hit in two years.
A few provisions in the Dayton budget plan include:
— $100 million to expand broadband high-speed Internet in rural Minnesota. The state would award grants to projects.
— $100 million to improve racial financial disparities. The governor proposes some new programs, while Republicans want to emphasize improving the education system that they say gives unfair advantages to whites.
— $77 million for a variety of early-childhood programs, highlighted by a voluntary program that would allow 4-year-olds to attend school.
School districts could seek funds for an entire district or specific schools. Also, there would be provisions so the funds are spread across the state.
— $12.4 million to attract more teachers.
— $2 million to allow state employees to take six weeks’ leave when a child is born or adopted.
— $900,000 to open a St. Cloud human rights office.
— $5 million to help tribal nations provide health and human services programs.
— $46 million to protect the state’s computer systems from hackers. Dayton said that “there are millions of threats every day, attempts to hack into one of the various state systems.”
— $22 million to improve security at the St. Peter state hospital and more than $10 million for the state sex offender treatment program.
Other funds also would be set aside for other Department of Human Services and Corrections Department security issues.
— $46.5 million to increase Local Government Aid to cities and County Program Aid to counties.
Spending increases the governor proposes in state government for the next year in the state’s existing, $42 billion, two-year budget:
Tax reductions, $117 million
Broadband, $100 million
Courts, $23 million
Corrections, $34 million
Cyber security, $46 million
Department of Human Services, $19 million (net increase, after reductions are figured in)
Bond repayment for public works, $21 million
Education and early learning, $77 million
Racial equity, $100 million
Higher education, $56 million
State payments to cities and counties, $47 million
Other agency spending, $44 million
Transportation, $14 million
A governor-appointed broadband task force suggests the state Legislature increase high-speed Internet goals by 2022, which could double some speed standards, while increasing them more than four-fold by 2026. The new speeds would jive with what the Federal Communications Commission considers high-speed service. The panel also recommended that the state increase its spending to expand broadband into more rural areas to $200 million, twice what Democratic Gov. Mark Dayton recommended last month. Most urban and suburban Minnesotans have access to high-speed Internet, but many in rural areas do not.
Lt. Gov. Tina Smith said that having the Internet “isn’t just nice, it’s necessary if we want Minnesota’s economy to work for everyone.”
“If we don’t do this, 244,000 Minnesotans and hundreds of communities will lack the basic infrastructure to connect to the 21st century economy, and that’s not fair,” Smith said. About 20 percent of rural Minnesotans do not have Internet access that meets state standards of 10 to 20 megabits per second download speeds and 5 to 10 megabits per second for uploads.
The Legislature in 2014 appropriated $20 million to expand rural broadband and $10 million last year. Some estimates indicate that upwards of $3 billion is needed to bring high-speed service statewide, with that cost split among federal, state and local governments; telecommunications companies; and other entities.. The task force this week also recommended that Minnesota provide more telecommunications aid to schools and libraries. Much of the report emphasized the need for high-speed Internet in today’s world.
Deputy House Minority Leader Paul Marquart, D-Dilworth, said action is needed in this year’s legislative session, set to begin March 8, after broadband funding nearly was zeroed out last year.
“Our rural hospitals, schools, businesses and residents deserve nothing less than the ability to compete in today’s global marketplace,” Marquart said. An assistant House majority leader said he wants funds for broadband, but the amount depends on how top-tier issues such as transportation and tax cuts pan out.
“I will support the best number we can get out,” Rep. Ron Kresha, R-Little Falls, said, thinking about “the many, many asks we have on the table in front of us.”
He already has introduced a bill to spend $35 million.
Included in the report is a story from 2013, which state officials say happens throughout Minnesota. When the task force visited the Alexandria library, a librarian told of a student sitting outside the library one day when it opened, using the facility’s wireless Internet connection to take an online test because the student had no other broadband access. Businesses, even in small towns, need to be connected online, the report said.
“Three years ago we started our online store; it is now half of our production,” the report quoted Marie Rivers of Sven Comfort Shoes in Chisago City as saying. “With our online presence we have been able to expand our business to $3.5 million, which is incredible for such a small town.”
Students throughout rural Minnesota can use the Internet for virtual trips, the report says, to locations such as the Minnesota Zoo, Minnesota Historical Society, Great Lakes Aquarium and the International Wolf Center, “all of which provide educational opportunities students would not normally have access to due to time constraints and transportation costs.”
While the task force suggests that the state spend $200 million for broadband expansion, private money also is helping. The RS Fiber Cooperative in Renville and Sibley counties, for example, is a coalition of electric and farmer cooperatives with local government assistance that is expanding broadband in that area. Telephone, cable television and similar companies also are investing in broadband, the report added, with more than $713 million expected to be spent this year.
Many of those companies offer help for the poorest Minnesotans to afford the Internet, but the report says that cost is the major reason that people do not sign up for high-speed Internet when it is available.