Greetings,

Please find below and attached information on action taken today by Governor Pawlenty on the following pieces of legislation:

Transportation Omnibus Finance, Chapter 143

Higher Education Omnibus Finance, Chapter 144

E-12 Omnibus Finance, Chapter 146

Taxes, Chapter 149

While there were many positive items in the bill supported by the Governor, the Governor vetoed the Tax Bill. Legislative leaders knew and were made aware by the Governor’s office throughout the closing days of the session, that including the policy language automatically incorporating inflation into the budget forecasting process could result in a veto. This inflation-indexing provision would put government growth on auto-pilot, a result the Governor clearly indicated he would not support.

(Additionally, you may be interested that the 2007 Citizen Compass Report (commissioned by the Coalition of Minnesota Businesses, a non-partisan, grassroots organization comprised of 11 employer groups) indicated opposition to such a inflation provision:

“When asked about the question of automatic inflation increases in the state budget, 69% believe the state budget should not be on auto-pilot, while just 30% believe including inflationary spending in budget forecasts is responsible fiscal management.”)

The Governor signed the other pieces of legislation, utilizing his line-item veto authority as indicated in the letters attached. The accompanying press release and additional documents provide the details.

As always, please do not hesitate to contact me with any question and thoughts – and I look forward to talking with you.

Again, I want to reiterate my commitment to working with you in the weeks and months to come and look forward to talking with you about issues on your radar going forward and the view from our office on key areas important to MN.

Thank you and good evening,

Bill Hoffman

Office of Governor Tim Pawlenty

130 State Capitol

Saint Paul, MN  ostalCode w:st="on">55155ostalCode>

Desk 651-296-7689

Cell 651-332-0745

Fax 651-296-0056

GOVERNOR Pawlenty signs K-12, HIGHER education AND TRANSPORTATION BILLS, VETOES TAX BILL

~ Governor’s actions complete work related to the 2007 legislative session ~

Saint Paul – Governor Tim Pawlenty today took action on the four remaining omnibus bills passed during the 2007 legislative session.  The Governor signed the K-12, higher education and transportation funding bills, deleting seven appropriations through line-item vetoes, and vetoed the tax bill in its entirety. 

Governor Pawlenty noted that funding in the K-12 and higher education bills account for nearly 50 percent of the state’s general fund budget and expressed disappointment that many of the reforms and accountability measures he proposed were not passed by the legislature. 

“Simply spending more money on education is not enough to increase student achievement.  We need increased accountability for results,” Governor Pawlenty said.  “The K-12 education bill failed to make significant reforms and barely addressed the need to bring more rigor and relevance to our high schools.”

The Governor had proposed up to 4% per year for school funding and this bill only includes 2% and 1% increases on the general education formula.

In his veto letter regarding the tax bill, Governor Pawlenty said there were many positive items in the bill, but that legislative leaders were aware of his opposition to including a measure that would automatically incorporate inflation into the budget forecasting process.

“When legislators and the Governor assemble the state budget, we shouldn’t assume that every program should grow on autopilot. We need to examine every taxpayer dollar that will be spent and ensure that we are streamlining and keeping government efficient and effective,” Governor Pawlenty said.  “When complaints come about provisions lost as a result of this veto, I would encourage people to contact DFL leaders who chose to keep controversial policy language in rather than passing a clean bill."

Higher Education Omnibus Finance Bill

The Higher Education Omnibus Finance Bill provides $3.16 billion in state funding for higher education institutions, students and related programs for the next two years, including a 14.9 percent funding increase for the laceType w:st="on">UniversitylaceType> of laceName w:st="on">MinnesotalaceName> and a 12.7 percent increase for the laceName w:st="on">MinnesotalaceName> laceType w:st="on">StatelaceType> laceType w:st="on">CollegeslaceType> and Universities system.

·        The laceType w:st="on">UniversitylaceType> of laceName w:st="on">MinnesotalaceName> will receive $1.39 billion, a $180 million increase over the current two year budget cycle. In addition to holding down tuition, the University is expected to invest in its technology infrastructure, competitive compensation for faculty and build its health, science and engineering research capacity. 

·        The laceName w:st="on">MinnesotalaceName> laceType w:st="on">StatelaceType> laceType w:st="on">CollegeslaceType> and Universities system (MnSCU) will receive $1.36 billion, a $153 million increase over the current two year budget cycle. In addition to holding down tuition, the system will invest in the development of science, technology, engineering, health care and mathematics programs, create a center of excellence in the biosciences, and reach more students from groups traditionally underrepresented. 

The legislature also passed Governor Pawlenty’s pay-for-performance proposal, making the laceType w:st="on">UniversitylaceType> of laceName w:st="on">MinnesotalaceName> and MnSCU eligible for a bonus based on measurable outcomes. Each will be able to receive approximately $12 million after demonstrating that they have achieved three of five strategic goals.

·        Goals for the laceType w:st="on">UniversitylaceType> of laceName w:st="on">MinnesotalaceName> include increasing grants and scholarships for low- and middle-income students, increasing research and development expenditures, increasing the number of degrees awarded in science and technology, and research and activity beneficial to business and industry.

·        Goals for MnSCU include increasing enrollment in science and technology courses, increasing enrollment in Centers of Excellence courses, increasing the number of students trained in the use of electronic medical record technology and increasing the number of students taking online courses.

Other key provisions of the Higher Education bill include:

·        $10.8 million for ACHIEVE, a new initiative proposed by Governor Pawlenty to allow high school students to earn college credit and receive a scholarship to any Minnesota college or university. Students who successfully complete advanced courses in high school such as calculus, physics, or coursework in Advanced Placement, International Baccalaureate and Postsecondary Enrollment Options will earn college credit and will receive $1,200 to be used at a public or private Minnesota college. An estimated 6,000 high school students are expected to receive ACHIEVE scholarships in 2008. 

·        $12 million for a G.I. Bill for Minnesota veterans who have served on active duty since September 11, 2001.  The Minnesota G.I. Bill provides up to $1,000 per academic term to veterans and the dependents of deceased and disabled veterans, while building on existing state and federal benefit programs for veterans.

·        The laceType w:st="on">UniversitylaceType> of laceName w:st="on">MinnesotalaceName> and Mayo Foundation partnership will receive $25 million over the next two years, with an ongoing appropriation of $8 million per year thereafter. The partnership is an ongoing research collaboration focusing on biotechnology and medical genomics.

K-12 Education Omnibus Finance Bill

The K-12 Education Omnibus Finance Bill provides $13.8 billion in state spending for the next two years, a $794 million (6.1%) increase over the previous two year budget cycle. Included in the bill is an increase in the per-pupil funding formulas of 2% in FY 2008, 1% in FY 2009 - at a cost of $246 million.

At the start of the legislative session, Governor Pawlenty put forward an education agenda designed to better prepare Minnesota students for the global marketplace, which demands a greater focus on innovative thinking, and skills in science, math and technology.  The Governor’s initiatives in the bill include:

·        Continuation of the Q Comp performance and professional pay initiative, aimed at encouraging professional development and rewarding quality teacher performance.  Currently 37 school districts are participating in Q Comp and 185 have expressed interest in joining the program.

·        $13 million for dual enrollment high school programs like Advanced Placement, International Baccalaureate, and College in the Schools. 

·        Creation of new regional Math and laceName w:st="on">SciencelaceName> laceType w:st="on">AcademieslaceType> that will enhance Minnesota’s Science, Technology, Engineering, and Math (STEM) initiatives. These academies will provide professional development and training opportunities for elementary, middle, and secondary teachers in math and science curriculum, standards, and instruction.

·        $6 million for the Governor’s early childhood scholarship program to provide families of at-risk pre-kindergartners with scholarships to prepare these children for kindergarten.

·        Over $90 million for technology in Minnesota schools

Other key provisions of the bill include:

·        Additional funding of $329 million for Special Education programs.

·        $10 million in additional ongoing funding will allow the Department of Education to meet its statutory obligations with regard to testing. Funding is also included for value-added testing.

·        $5.4 million for gifted and talented programs.

·        $16 million increase in early childhood programs.

·        $5.4 million for gifted and talented programs.

Transportation Omnibus Finance Bill

The Governor also signed the $3.8 billion Transportation Omnibus Finance bill that provides funding for the Department of Transportation, the Department of Public Safety, and the Metropolitan Council. 

“Unfortunately, the legislature failed to pass my transportation funding proposal that would have accelerated work on important projects across Minnesota,” Governor Pawlenty said. “It’s unfortunate that some legislators and advocates again overreached and went for a massive tax increase instead of moving Minnesota forward with a reasonable road package.”

Governor Pawlenty’s 2007 transportation proposal would have infused $1.7 billion in bonding and one-time funding to advance road projects across the state. The Governor proposed and signed a transportation bill in 2003 that funded $900 million in critical, long-delayed, state highway and bridge projects authorized in the 2003 transportation bill – the largest infusion of transportation funding in Minnesota’s history.