Updates on Omnibus Bills

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April 22, 2023

Executive Summary

• Bipartisan Veterans Bill

• State Government and Elections Omnibus Bill

• Transportation Bill

• Taxes Bill Introduced in Committee

• Change to E-Pull Tabs and Charitable Gambling Tax

Bipartisan Veterans Bill

I was so happy that the Veterans omnibus bill came to the floor as a stand-alone bill for the second year in a row! Our servicemen and women fight to defend all Americans, not those of a particular political party, so it was wonderful that we could take a strong, bipartisan vote to support our Veterans. 

This bill provides $367.7 million for programs to help veterans over the 2024-25 biennium, a 52% increase. Programs include:

• Expands eligibility for free burial in Minnesota state veterans cemeteries to spouses and dependent children of service members who die on active duty.
• Prohibits the Minnesota Department of Veterans Affairs from charging burial fees.
• Expands the Veterans Bonus program to veterans who currently live in Minnesota even though they may not have lived in the state when they enlisted, as well as veterans who served in the Inherent Resolve Military campaign.

I wish every omnibus bill would come to the House floor as a stand-alone bill, like the Veterans’ bill. Combining multiple bills into a single package does not allow for good debate and makes these unanimous votes far too rare. 

State Government Elections Omnibus Bill

The State Government and Elections Omnibus bill also passed this week. The State Government portion of the bill continued the Democrat spending spree with pay raises for politicians, massive budget increases for agencies, and doubling down on wasteful spending, including $500 million for State Office Building renovations. 

The most concerning elements of this bill were included in the Elections portion, which was a continuation of the Democrats partisan elections bill, HF 3, which passed recently. These proposals include:

• Puts Minnesota in the National Popular Vote compact. If enacted, this would give Minnesota's electoral votes to the presidential candidate deemed to have won the most individual votes nationally. I do not support this as I think it is a violation of the Constitution and it disadvantages small states like Minnesota. 
• Repeals the eligibility requirements so that anyone – including non-citizens who are ineligible to vote – may vote in party caucuses.
• Increases the threshold for obtaining major political party status from five percent to ten for the number of votes received at an election. This will make it more difficult for small parties like the Independent Party or the Marijuana Party from having their candidates on ballots.

It is disheartening to see Democrats pushing these substantial changes to our elections without broad, bipartisan support. There is a long history of needing bipartisan agreement before we enact election changes in Minnesota. I hope the Senate will remove these troubling provisions.

Transportation Bill

In previous emails, I mentioned the concerning tax increases that were included in the Transportation omnibus bill. I am disappointed to report that all these tax increases were passed this week despite Minnesota's record surplus. As a reminder, these tax increases included:

• A ¾ cent Metro Area sales tax increase for transit. Residents of the 7-county Metro Area are estimated to pay more than $2 billion through this sales tax increase. Nearly 83% of this amount is dedicated to transit, while only 17% is dedicated to Metro Area roads.
• A 75-cent “Delivery Tax”. This new tax is expected to generate nearly $513 million from every delivery you receive – from an Amazon package to a pizza delivery. Money would go towards funding for state and local roads.
• License Tab Fee Increases. $736 million will be generated from increased fees on license tab renewals. This funding will go towards the Highway Users Tax Distribution Fund.
• Motor Vehicle Sales Tax Increase. Under this provision, the Motor Vehicle Sales Tax would increase from 6.5% to 6.875%, costing motorists more than $215 million. 60% of this funding would go to the Highway Users Tax Distribution Fund, and 40% would be used for transit.

Additionally, the bill appropriates $194 million for a passenger train to Duluth, as well as $4 million for a study to implement a passenger train to Fargo and extend the Northstar Commuter train to St. Cloud. It has no requirements for the Met Council to hire more police for transit safety. Climate action will also be forced into planning by cities through the Met Council Comprehensive planning, which could greatly impact land uses and highway road expansions by MnDOT statewide.

These tax increases will hurt Minnesotans at every income level. The Senate Democrats took their 75-cent delivery fee out of their bill this week. I hope all of these tax increases are removed in conference committee.

Taxes Bill Introduced in Committee

This week, the House DFL released their long-awaited tax plan. I am disappointed that it does not go far enough to return Minnesota's $17.5 billion surplus to our hardworking families and seniors. Highlights include:

• Rebate checks totaling $275 for individuals making less than $75,000 and $550 for couples making less than $150,000. This is significantly less than Governor Walz's proposed rebate checks worth $1,000. 
• Partial elimination of the tax on social security. Couples who make $100,000 or less and individuals who make $78,000 or less will be fully exempted from social security taxes.
• Creation of a new 5th-tier tax rate. Individuals making $600,000 and couples making $1 million would be subject to a 10.85% tax rate. This would give Minnesota the 4th highest income tax rate in the country, behind CA, HI and NY (which is 10.9%).

Since we treat capital gains the same as regular income, it would also give us the 2^nd highest capital gains rate in the country. This new 5^th tier hurts our ability to compete with other states to attract the investment and workers we need to grow our economy. 

This is not the kind of relief Minnesotans have been asking for. I again offered an amendment in the Taxes Committee to fully exempt the tax on social security. I am disappointed that it was not adopted, but I hope the Senate will include this proposal. You can watch me speak about the need to support our seniors here.

Change to E-Pull Tabs and Charitable Gambling Tax

As many of you know, I have been working to reduce the tax on charitable gaming for years. This year, I chief-authored three bills that would either eliminate or reduce the taxes charities pay to the state on their gambling proceeds:

• HF 163 – Reduce the current tiered tax on charitable gaming to a flat 5% tax.
• HF 285 – Repeal the state tax on charitable games.
• HF 278 – Allow Veteran’s Organizations to use up to 50% of their gross receipts to repair/maintain their physical property.

This would expand the allowable expenses for gross receipts and allow VFWs, Legions and other Veteran’s groups to use the money to maintain, remodel and otherwise improve their property, like adding security systems, upgrading kitchen facilities, improving ADA access, etc.

Unfortunately, none of these bills received a hearing. The House Omnibus Tax bill had a very small cut in the charitable gambling rate – it is almost negligible.

The House Tax bill also has a provision that would end “open-all” e-pull tabs, which would be devastating for all of our local charities and the bars/restaurants that host them. These “open-all” games have been used for years and approved by two Administrative Law Judges. Ending these games would severely impact the revenue generated for charities. With no real tax relief given to offset the loss of revenue, the result will be that local charities will hardly have any proceeds to distribute in the communities.

This language is extremely concerning – in 2022, e-pull tabs generated almost $2 billion in revenue that was then invested into our communities. Without this critical revenue stream, much of the charitable efforts Minnesotans currently benefit from would not be possible. We offered an amendment in the Tax committee to address this, but the amendment was defeated on a party line vote.

This provision in the Tax Omnibus Bill not only threatens our local charities, but the bar and restaurant industry they partner with including many in our communities. Our local bars and restaurants continue to struggle with workforce shortages, a supply chain crisis, and inflation. Cutting off this significant revenue stream is going to cause even more significant negative impacts.

Please join me in fighting to ensure that Minnesota’s veterans organizations, non-profits, youth sports teams, volunteer fire departments, and other charitable groups are able to continue to do their work in our community.

We need community members, charities, bars, restaurants, VFWs, and other organizations to join us in the fight to protect charities by contacting your State Representatives, Senators and Governor Walz to ask them to take this language out. The DFL has a trifecta – control of the House, Senate and the Governor’s office. They need to understand just how serious the consequences would be if this provision is passed.

I would encourage you to share your feedback with House DFL Leadership and DFL members of the Tax Committee. I would also encourage you to reach out to your organization’s members and the community partners who benefit from your charitable giving and urge them to share their thoughts as well.

Speaker Melissa Hortman: Rep.Melissa.Hortman@house.mn.gov

Senate Majority Leader Kari Dziedzic: karid@senate.mn

Governor Tim Walz: Contact Form

Thank you for fighting with us! We can still get this language out in the Senate bill or in the Conference Committee!

Photos

Great to see Allen Lund from the Osseo/Maple Grove American Legion Post 172 in Taxes Committee! He came to testify against the provisions that would eliminate “automatic-open” e-pull tabs for charitable gambling, like Veterans’ groups, civic groups like Maple Grove Lions & Northwest Area Jaycees, sports teams, etc.

Great to meet Frances Haugen, the Facebook Whistlerblower who exposed to how they use algorithms to maximize engagement, even when they know it causes harm to kids. Her work led to the The Wall Street Journal articles that prompted me to draft the Stop Online Targeting Against (SOTA) Kids Act. I’m disappointed my bill is dead for this year, but will support the inclusion of the Age-Appropriate Design Code in the Commerce bill.

Please Contact Me

Many of you have already been in touch to discuss your thoughts on the issues that matter most to you. Thank you for sharing your ideas! Please continue to contact me to discuss any matters to which I can be of assistance. I’d also love to meet you if you are coming to the Capitol!

The best way to reach me is by email: rep.kristin.robbins@house.mn.gov. For occasional updates, you can follow my Facebook Page at @RepKristinRobbins. You can also leave a voicemail on my office number, 651-296-7806, which is checked multiple times/week.

Have a great weekend!

Kristin

239 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
Saint Paul, MN 55155
ph: 651.296.7806