By Danielle Nordine and Don Davis
A Republican plan to begin repaying school districts for payments the state has delayed heads to hostile territory in Democratic Gov. Mark Dayton’s office.
The Minnesota House and Senate Monday approved a proposal to repay schools $430 million. However, that would leave about $2 billion yet to pay.
Money would come from reserves that just now are being built up after a budget deficit drained them.
Rep. Pat Garofalo, R-Farmington, said the focus of his bill solely is on paying back the school districts.
“It’s a good step and a good start to restoring the opportunity for our local school districts to avoid short-term borrowing and using their own reserves,” Sen. Gen Olson, R-Minnetrista, said.
But Rep. David Dill, DFL-Crane Lake, said that taking money out of the reserves now is not good timing.
“We need to pay them back as soon as possible, but not under the guise of throwing financial planning to the wind,” Dill said. “This is very, very poor financial planning.”
Rep. Paul Anderson, R-Starbuck, said there is more money in the reserves than any time since he was elected four years ago, so it makes sense to repay schools.
The Legislature and governors have delayed school payments for years as the state budget was tight.
The bill headed to Dayton restores the delays approved a year ago, but does not touch those from earlier budgets. Dayton has said he does not like the GOP plan.
Democrat Rep. Ryan Winkler of Golden Valley accused Republicans of using the proposal as a political ploy.
He said Democrats have proposed closing what he called corporate tax loopholes to pay back what is owed to school districts, but that has been ignored. A Senate bill allows horse-racing tracks to add casinos, with new state revenue going to repay schools.
Sen. LeRoy Stumpf, DFL-Plummer, warned that taking funds from the reserves could affect the state’s financial stability and affect its credit ratings.
The Senate approved the measure 35-28 and the House voted 75-56. Both votes were mostly along party lines.