Dayton revises tax offer in hopes of reaching budget deal

Gov. Dayton tells reporters about his latest budget offer:

GOP legislative leaders react to Dayton’s proposal:

Gov. Dayton is revising his tax proposal with the hopes of convincing Republicans to accept some sort of revenue increase. Dayton has presented GOP legisaltive leaders with two offers. The first would create an temporary income tax increase on people making more than $1 million. It would also increase surcharges on hospitals and health plans and delay payments to schools.

The second option would raise cigarette taxes by $1 a pack, increase the health care surcharge and delay payments to schools.

Dayton said he was revising his budget plan with the hopes of convincing Republicans to accept some sort of revenue. Republicans quickly rejected the plan which prompted Dayton to say Republicans don’t support any proposal that increases revenue.

“If this is a step back, it’s their step back,” Dayton said.

GOP legislative leaders renewed their call for Dayton to call lawmakers back into a special session so they can pass a bill that would continue funding.

GOP House Speaker Kurt Zellers says the offer is a step backwards. He says Republicans campaigned on holding the line on taxes and spending.

“If that’s what we campaigned on and that’s what we were elected on, how do our members go back home and say we gave up all of our principles to the governor?” Zellers told reporters. “It’s not about wins and losses. It’s about keeping your word to the people who elected you.”

The sides are at odds over the best way to erase a $5 billion projected budget deficit. Dayton says ongoing revenue has to be on the table. Republicans say they don’t support any spending increases. The two sides are $1.4 billion apart on a two year budget.

Minnesota is in the sixth day of a state government shutdown.

Update:

Michael Brodkorb, spokesman for the Senate Republican Caucus and Deputy Chair of the Minnesota Republican Party, sent an e-mail to reporters pointing out that Dayton rejected a tobacco tax increase during the 2010 campaign for governor.

“You raise the price of a pack of cigarettes $1.50 as Mr. Horner proposed, that’s money out of the pockets of working people and poorer people, and that means kids don’t have as much to eat or don’t have the same quality of food. Those are addictions, and I think you treat addictions as addictions and you don’t penalize the people who are dealing with them economically.” Source: Smart Politics

For his part, Dayton said there are few viable alternatives left that would raise the amount of money needed to close the gap between him and Republicans.

“After the income tax there aren’t any good taxes in my view. But the only real sources of permanent revenue are property taxes, sales taxes and so-called sin taxes,” Dayton told reporters.

Here’s Dayton’s letter:

20110706143455518

Here’s what Dayton says his $1.4 billion in added revenue will protect:

20110706143827202

  • Michelle Hawkins

    Hey Governor! Another cigarette tax? Really? I thought you were in the common man’s corner!

    That’s a really limited plan too. I have a couple better thoughts; more people drink than smoke. You want the health benefits of cutting back that activity? 36 people die for every one alcoholic that gets sober. Tha destruction they leave in their wake can last for decades.

    Put your $1 tax on alcohol and save more lives, make more lives better, discourage more teens from becoming future 12-step members or dying.

    Second idea; obesity is killing more minnesotans, and costing my medical dollars than cigarettes these days. Our minnesota kids are developing high cholesterol and fat little bodies at verry young ages.

    Put a .05 cent tax on any food item containing more than 10grams of carbohydrates per 6oz serving.

    You’ll solve you budgte crises quickly and you’ll be doing more for Minnesotan health than the tired old overused cigarette tax/fee that will only give Pawlenty more ammo to use in bad talking you..

  • Jamie

    A couple comments…

    First, I wish Dayton would Q U I T offering more compromises to the intransigent Republicans!! He’s already compromised enough! — way more than extremist liars Zellers and Koch have. Democrats always end up doing all the compromising, and Republicans KNOW this. Koch and Zellers are simply WAITING for Dayton to totally give in, just like Democrats almost always do. Can’t Dayton see this? Aaarrrgghh!!

    Second, who was it, Tim Pugmire who told this story at around 5:30? He gave way too much time to the Republican point of view. And MPR should quit characterizing what Dayton wants as just tax increases (as opposed to how Republicans want all cuts). Dayton is offering many cuts in his budget proposals too, and has said he favors a combination of cuts and increased revenue. And the cuts he has reluctantly proposed are how he has been compromising since the very beginning.

  • Chris

    I remember in early 2009, a lot of Obama’s supporters were defending all the unilateral concessions he was making to the Republicans on his agenda in exchange for zero votes, by saying that “It’s all part of the brilliant plan to make the Republicans look unreasonable, don’t you see?? Once the GOP realizes how unreasonable they’re coming across, they’ll be more willing to compromise in the future and then we’ll get what we want.” A lot of Dayton’s supporters have been making those same arguments during this session.

    If that is the Democrats’ political strategy, then fine, if it works. But if it keeps on failing and nobody ever seems to learn anything from its repeated failure, then we’ve got a problem.

  • Eric Ferguson

    Brodkorb is pulling a cheap shot by making look like Dayton is flip-flopping on a cigarette tax. He’s looking for just something Republicans will say yes to. Their idea of a counter-offer is to just repeat the old offer. If Republicans are deliberately trying to force a shutdown, they have a funny way of showing it. It’s like they’ve never had to split a difference in their lives and just can’t grasp the concept.

  • Wm. Sweeney

    The Dayton administration has not done a good enough job in communicating to the public why there is such a gap between his proposals and those of the GOP legislators. And what changes will result if the GOP budget is in place.

    The GOP sound bites on their $34B budget of “the highest level of state expenditures ever” and “an actual increase in state spending” are simplified and misleading…yet register with the public. The GOP simply has done a better job of pr so far…

  • Jamie

    // “Once the GOP realizes how unreasonable they’re coming across, they’ll be more willing to compromise in the future and then we’ll get what we want.” A lot of Dayton’s supporters have been making those same arguments during this session.” //

    That is SO WRONG. I read something recently about how Democrats always work at being the most REASONABLE of the parties in any conflict, while Republicans work at WINNING. Guess who almost always wins? Republicans couldn’t care less if they’re perceived as being unreasonable. They don’t even care that many of their own are perceived as liars – they just keep on telling the same lies. And they don’t care if they’re perceived as fighting dirty either, so they often win by fighting dirty (which is a hallmark of Brodkorb’s work). In fact, it seems that they’re actually proud of being liars who fight dirty.

    Mr. Sweeney: Republicans always do a better job of PR and marketing (disciplines devoted to making lies sound like the truth). It’s how they win elections.

  • Dione

    “If that’s what we campaigned on and that’s what we were elected on, how do our members go back home and say we gave up all of our principles to the governor?” Zellers told reporters. “It’s not about wins and losses. It’s about keeping your word to the people who elected you.”

    What a load! Do Republicans even know how to negotiate anymore? It’s not by going back to the “first final” offer again and again.

    Zeller’s statement tells it like it really is. It is not about the good of the state, it’s about getting re-elected.

    Note to Governor Dayton: No More Compromises with these hacks. Take the school payment shift off the table. Tell your constituents the truth about the Republicans so-called spending hike-that they are just paying off Pawlenty’s deferred responsibilities. I know there are people hurting out there, but if you give in, the pain will just go on and on.

  • Dione

    Governor Dayton also made campaign promises. He has compromised, like real negotiators do, and I haven’t seen any angry mobs chasing after him.

    BTW, there were about 7000 people who voted DFL in your district. You do realize that you represent them also, don’t you?

    Minnesota is not populated by ONLY millionaires and corporations. Most of us are somewhere in the middle class. And I, for one, don’t really care about your re-election chances, I want Minnesota up and running again.

  • http://minnesota.publicradio.org/collections/special/columns/polinaut/archive/2011/07/dayton_revises_2.shtml Steven Csargo

    Governor Dayton, Please pull up your pants and do what we elected you to do. Govern and represent the people, not special interest groups. The rich, $500K and up are NOT paying their fair share of taxes compared to the middle and lower classes since pre-Reagan era. Show the people and republicans what the rich used to pay in taxes. Call this Special Session and LOCK the doors! Do not come out until this is RESOLVED. You ALL had many months to get this accomplished, and failed to DO the job that you ALL were hired and elected to do. Suspend ALL pay to Mn. Congress until this Gov’t. Shutdown is over with. No days off until completed and the Minnesota Gov’t. is running again.! How about stopping payments to ex-congressmen/women that have served in office. Once their term is over, they should NOT be continually paid after they leave office! That in itself should balance the budget.