[co-authors: Joey Novak and Stephanie Pinkalla]

During the final 10 days of the 2015 session, Governor Dayton, Senate Majority Leader Bakk and Speaker Daudt met frequently, attempting to reach a final agreement to end the session. Last week, the negotiators agreed to table two major pieces of legislation until 2016, the tax bill and a comprehensive transportation finance bill. The focus shifted to reaching an agreement on the biannual operating budget and passing the eight omnibus finance bills. Unable to reach a final agreement with Governor Dayton, Senator Bakk and Speaker Daudt announced on May 10, 2015, that they had reached an agreement on the budget. Governor Dayton was particularly unhappy with their agreement on the E-12 education finance bill and announced that unless spending was increased by $150 million and universal preschool education for four-year-olds was added to the bill, he would veto it.

The Governor and legislative leaders continued to negotiate a final agreement until 30 minutes before adjournment. In the end, the House and Senate passed their version of the E-12 education finance bill as the Governor announced his intent to veto the bill.

Minutes before the Monday midnight deadline, the final funding bill was passed and the Legislature adjourned. Governor Dayton has vetoed the E-12 education finance bill and is reviewing the other bills passed during the final days of the session. The Governor has indicated he may veto additional bills and that he will continue negotiations with legislative leaders. Once an agreement is reached, he will call a special session to enact the bills replacing those he has vetoed. 

The Legislature also failed to enact a bonding bill and a bill appropriating money from the legacy amendment proceeds. It is possible that these bills could also be added to a special session agenda. Due to Capitol renovation work, the special session will have to be conducted at an alternative location in St. Paul.

Education

Through hours of negotiations, Speaker Daudt, Majority Leader Bakk and Governor Dayton were unable to come to an agreement on an education bill, but that did not stop House and Senate leadership from coming to a bipartisan agreement. The education funding bill passed and sent to the Governor includes 1.5 percent and 2 percent increases for Fiscal Years 2016 and 2017 in the funding formula for schools, money for early learning scholarships, $32 million in school facilities funding and a reduction in standardized testing. The Governor, who has repeatedly reminded the legislature of his commitment to universal preschool for four-year-olds, vetoed the bill on Tuesday. The education debate will be re-opened in the special session and failure to come to an agreement before July 1 could result in teacher layoffs across the state and the closing of the Department of Education.

Environment

Early Monday morning, the Environment and Agriculture Conference Committee chaired by Rep. Denny McNamara (R-Hastings) and Sen. David (DFL-Chisholm) Tomassoni re-opened its conference committee report to include the buffer strip plan negotiated with Governor Dayton. This plan, which provides a buffer around public waters and ditches across the state, was a top priority for Governor Dayton. Funding for the buffer proposal is contained in the legacy bill which the Legislature failed to enact.

In addition, this bill eliminates the Minnesota Pollution Control Agency’s Citizen Board, exempts sulfide mining waste from solid waste rules and removes some clean water program funding. Several environmental groups have called for the Governor to veto this bill.

Health and Human Services

Early in negotiations, HHS was seen as potentially the most problematic of the omnibus finance bills. This was due to significant policy differences and an almost $1.5 billion gap in spending. Despite these differences, the HHS conference committee came away with a relatively straightforward compromise. The end result did not include House Republican initiatives to restructure MinnesotaCare or MNsure, but did reform those programs. Changes include a rate increase on Minnesota Care users, earlier release of MNsure premium rates to the public, a requirement to seek a federal waiver allowing premium subsidies to those not insured through MNsure, and finally, the creation of a MNsure task force to study future reform.

Upcoming Legislative Notes

In the coming days, Senate Majority Leader Bakk, Speaker Daudt and Governor Dayton will begin negotiations to resolve their differences with the K-12 omnibus finance bill, resolve other differences that might arise as a result of additional vetoes, and negotiate the parameters of a special session. Next week, we will share a thorough update on what happened this session and what to expect as we look toward a special session.