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Capitol View®
Mike Mulcahy

Daily Digest: State leaders say they’ll avert shutdown pain

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Good morning and happy Wednesday. Let's get the Digest in before the polar vortex hits.

1. State officials pledge to come through if feds won't. Minnesota’s political leaders put on a show of unity Tuesday even as partisan discord grips Washington. The state has already absorbed tens of millions of dollars in expenses that the federal government would normally pay. Now that a partial federal shutdown is in its fourth week, Management and Budget Commissioner Myron Frans is increasingly worried about the dent it could put in the state’s finances. “A 25-day shutdown starts to have serious, negative economic consequences,” he said at a state Capitol news conference. The impasse is rooted in a dispute over border wall funding that President Donald Trump is insisting on and Congress hasn’t delivered. In the meantime, a quarter of the federal government is closed or operating in limited fashion. Employees are going without pay checks, transportation dollars are hung up and money for food stamps and school lunch programs has been thrown into doubt. Minnesota is doing what it can to fill the void, said Gov. Tim Walz. “As of this time, we’re telling you, there have been no services cut, there has been no one laid off,” he said. “All benefits are being paid according to as they were before the shutdown. And that is continuing.” But that means using state money to plug costs for now and hoping that the federal government will reimburse Minnesota once the dispute ends. (MPR News)

2. Debate is joined over 2 percent health care tax. The health care debate that dominated last year's campaign season picked up again Tuesday at the state Capitol just a week into the 2019 session, as Republicans and Democrats held dueling news conferences over a health care tax that is set to go away at the end of the year. A 2011 law set the sunset date for the 2 percent tax, which was originally enacted back in 1992 to fund MinnesotaCare, the state subsidized insurance program for the working poor. Most of the money for the program now comes from Washington under the Affordable Care Act and from premiums paid by those in the plan, but lawmakers have used the tax to fund other health care programs. Gov. Tim Walz and DFL lawmakers want to keep the tax in place as they look to expand MinnesotaCare with a buy-in option. House Minority Leader Kurt Daudt of Zimmerman said the tax should end as planned, and the DFL's proposed reversal would increase health care costs. “That’s exactly the wrong approach. We feel that you don’t make health care for Minnesota families more affordable by raising the cost of health care. We feel that would be a broken promise by Democrats.” The tax generates more than $600 million a year. (MPR News)

3. Klobuchar questions Barr on shutdown, the media. Sen. Amy Klobuchar asked President Donald Trump’s attorney general nominee about Robert Mueller’s special counsel investigation, election security and voting rights, press freedom, corporate consolidation, the partial federal shutdown and immigration in a brief burst of questioning on Tuesday. William Barr faced the Senate Judiciary Committee for confirmation to lead the U.S. Department of Justice. Klobuchar, a Minnesota Democrat and a member of the panel, ran through a litany of hot-button issues in a series of exchanges with Barr that ran about five minutes. Klobuchar opened her first round of questioning by asking about the shutdown. “Employees of the Justice Department are furloughed or they are working without pay,” Klobuchar said to Barr. “I have talked to a number of them at home and it’s an outrage. Very briefly, what do you have to say to them?” In his answer, Barr bolstered Trump’s demand for a Mexico border wall if he is to support the spending bills to reopen government. “I would like to see a deal reached whereby Congress realizes it’s imperative to have border security and that border security as a common-sense matter needs barriers.” (Star Tribune)

4. House climate committee meets for the first time. It was the first of two sessions meant to brief the legislators on the new House Energy and Climate Finance and Policy Division on the latest in climate science, so they can decide what — if anything — the Legislature can do to combat climate change. Several University of Minnesota experts walked the members through the changes in temperature and precipitation the state is already seeing thanks to a changing climate — and the pests, pathogens and invasive plants that come along with both. University of Minnesota professor Peter Reich, a forestry expert, reminded legislators of something scientists have been saying for years: that Minnesota icons like the common loon might not be common at all in the future. “The species adapted to cold winters and cool summers, a whole raft of them are going to become less abundant and some of them are going to disappear entirely from our state,” he said. “For some of them that’s almost guaranteed at this point, because we’re not going to slow and stop climate change fast enough.”  That question — how fast Minnesota and the rest of the world can address climate change — is central to the committee’s work. And while committee members mostly sat back and listened to the experts, it was clearly on many of their minds. (MPR News)

5. Big development in Rochester on hold. Rochester’s agreement to sell riverfront property to an Abu Dhabi-based developer  has been terminated. Apparently seeking to revise its plan, Bloom International Realty has backed out of the agreement for a proposed $230 million development along the west side of the Zumbro River in Southeast Rochester. “We are going to continue with Bloom and have discussions to understand what this means,” Rochester City Administrator Steve Rymer said Monday. He said the developer informed the city in December that it is ready to continue with the first phase of the project, which includes creation of private senior housing in a tower south of Third Street. However, plans for the northern tower, which was designed to include retail space, a hotel and condos, are uncertain. Assistant City Administrator Terry Spaeth said the first phase of the project was set to start construction in July, but it’s uncertain whether that timetable will remain in place, since a new purchase agreement must be developed. He said the city is waiting for Bloom to define its expectations for a revised agreement before seeking council input. “The council needs something to react to,” Spaeth said. In addition to council approval, a new agreement will face Destination Medical Center Corp. board review since it approved $18 million in tax-increment financing for the original agreement. (Rochester Post Bulletin)