Tax, bonding bills will have to wait until next year

ST. PAUL — Gov. Mark Dayton and legislative leaders on Thursday abandoned their hopes of calling a special session to wrap up a tax bill and public construction package this year.

Minnesota’s top politicians have struggled to reach agreement on an overtime session since the Legislature adjourned in late May, when lawmakers left a $1 billion-plus public works package unfinished. Dayton added to the pile by vetoing a $260 million tax relief package, citing a wording error.

Despite months of routine private meetings, an ideological divide over funding a light-rail system to southwestern Minneapolis suburbs — a project that Democrats have deemed essential but Republicans dislike — proved too much. Clearly frustrated leaders from each party blamed each other for the impasse that would leave tax cuts and public works projects until at least next year.

“I’ve concluded that after almost three months of futile efforts to reach an agreement … I’m not going to call a special session. I’m not going to pursue any further attempts to get together,” Dayton said after the Thursday afternoon meeting.

The two sides had previously said they were closing in on a deal for a special session, penciling in a mid- to late August meeting as they worked to hammer out an agreement on funding the light-rail project. By Thursday, it was clear a solution wasn’t in sight.

Republican House Speaker Kurt Daudt called the light-rail project dead, and lamented that tax relief and the public works bill would go down with it. Dayton vowed to put up a similar tax package — including tax relief for a new Major League Soccer stadium in St. Paul, a childcare tax credit and other measures — at the start of 2017. He also

indicated he would revive a push for a gasoline tax increase to fund road and bridge repairs.

“I’m extremely disappointed to see one controversial light rail train project in the Twin Cities become more important than middle-class tax relief and funding for key projects throughout the entire state, both metro and Greater Minnesota,” said District 27A Rep. Peggy Bennett in a news release.

Bennett said the House, Senate and governor agreed on almost every provision for a special session but claimed the DFL wouldn’t budge on the Southwest Light Rail.

“We should pass the 99 percent of what we all agree upon instead of letting a controversial issue stand in the way of re-passing these bills,” she said.

The special session failure means the light-rail project is likely to become an issue in the fight for legislative majorities this fall. Daudt is aiming to maintain the GOP’s hold on the House, while Democrats are protecting their own majority in the Senate.

“I think these are going to be tough issues for Democrats on the campaign trail this fall,” Daudt said.