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2016 Legislative Session Comes to a Close

At 11:59 p.m. on Sunday night, the 2016 Session came to a close.  After an intense twelve weeks, the Session ended not far from where it began: without agreement on transportation funding or a public works bill.  Stark divisions between the Senate Democrats and House Republicans  proved to be too much to overcome in the final week of session.
May 23, 2016

Table of Contents:
Agreement Reached on Spending & Taxes
Too Big a Divide to Reach Transportation Deal
Other Casualties of the Rush to the Finish

This edition of the MADA Legislative Bulletin was created in the final hours of the legislative session.  A complete review will be coming your way in the next two weeks. In the meantime, if you have questions about legislative activity, don't hesitate to contact MADA Director Government Affairs Amber Backhaus at

Agreement Reached on Spending & Taxes

Even though legislators couldn't figure out a transportation or bonding bill, they did find common ground on tax cuts and supplemental spending.  House File 848 includes $258 million in tax relief for Minnesotans, including:
  • nearly full conformity to federal tax provisions enacted in 2014;
  • a first-in-the-nation student loan tax credit;
  • expansion of the child care tax credit;
  • tax deductions and credits for families contributing to 529 savings plans;
  • expansion of the working family tax credit;
  • expansion of tax credits for some veterans; and
  • a school building bond agricultural credit.
For businesses, the bill exempts the first $100,000 of a commercial-industrial property from the statewide business property tax.

Along with the tax credits, the House and Senate also agreed to a supplemental budget bill (House File 2749) of approximately $233 million in spending.  The big ticket items are $25 million for pre-kindergarten education, $35 million to build out broadband infrastructure, and $35 million for racial inequities.


Too Big a Divide to Reach Transportation Deal

Despite overall agreement that investing in the state's transportation infrastructure should be a top priority, the Democrats and Republicans couldn't agree on how to do so.  Last session, Senate Democrats proposed raising the fuel tax, tab fees, and metro area sales tax to provide new revenues while House Republicans wanted to dedicate existing transportation-related taxes (i.e. sales taxes collected on auto parts) to the cause.  In the last two weeks of session, some movement toward middle ground was made as Governor Dayton proposed dropping the fuel tax increase and the House accepted adjusting license tab fees.  However, major disagreements over whether to use any general fund dollars for transportation and how to fund transit stopped them from getting any closer to reaching a deal. 

Other Casualties of Rush to the Finish

  • Real ID: Having Minnesota drivers licenses comply with federal compliance requirements for Real ID also fell by the wayside, as a conference committee couldn't agree to documentation standards for applicants who choose not to have a Real ID compliant drivers license.
  • Electric Vehicle Promotions: a last-ditch attempt to allow electric utilities to offer promotions for electric vehicles was turned down as an amendment to the supplemental budget bill in conference committee. 
Copyright © 2016 Minnesota Automobile Dealers Association, All rights reserved.

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