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Session Weekly April 4, 2003, Volume 20, Number 13

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Session Weekly April 4, 2003, Volume 20, Number 13 APRIL 4, 2003 VOLUME 20, NUMBER 13 In this issue: RAISING CIGARETTE TAXES NEWEST HOUSE MEMBERS, AND MORE HF1302-HF1468 ESSION S Weekly Session Weekly is a nonpartisan publication of the Minnesota House of Representatives Public Information Services. During the 2003-2004 Legislative Session, each issue reports daily House ac- tion between Thursdays of each week, lists bill introductions and upcoming commit- tee meeting schedules, and provides other information. The publication is a service of the Minnesota House. No fee. CONTENTS To subscribe, contact: Minnesota House of Representatives IGHLIGHTS Public Information Services H 175 State Office Building Agriculture • 5 Environment • 13 Insurance • 21 St. Paul, MN 55155-1298 Arts • 6 Ethics • 14 (651) 296-2146 or Law • 22 1-800-657-3550 Business • 7 Family • 15 Local Government • 22 TTY (651) 296-9896 Consumers • 7 Gambling • 15 Metro Affairs • 23 Crime • 8 Game & Fish • 16 Military • 25 Director Development • 9 Government • 17 Recreation • 25 Barry LaGrave Education • 9 Greater Minnesota • 17 Safety • 26 Assistant Director Elections • 11 Health • 18 Transportation • 26 LeClair G. Lambert Employment • 12 Higher Education • 19 Editor/Assistant Director Michelle Kibiger Assistant Editor FEATURES Mike Cook PEOPLE — Rep. Rebecca Otto (DFL-Marine on St. Croix) won a special Art & Production Coordinator election Feb. 11 to replace Mark Holsten who defeated her in the general Paul Battaglia election and resigned to become deputy commission in the Department of Writers Natural Resources. • 28 Miranda Bryant, Patty Janovec, Jeff Jones, Tom Lonergan PEOPLE — Rep. Duke Powell (R-Burnsville) won a Feb. 3 special election Chief Photographer and replaces Dan McElroy, who resigned to become the state’s finance Tom Olmscheid commissioner. • 29 Photographers Andrew Von Bank, Kristine Larsen PEOPLE — Rep. Kurt Zellers (R-Maple Grove) is the newest member of the Office Manager House, elected Feb. 25 to fill the seat vacated by Rich Stanek, who resigned Nicole Wood to become the state’s public safety commissioner. • 30 Staff Assistants Christy Novak, Joseph Rude Session Weekly (ISSN 1049-8176) is published DEPARTMENTS/RESOURCES weekly during the legislative session by the Minnesota House of Representatives Public Information Services, 175 State Office Building, It’s a Fact: High places • 4 Committee Schedule (April 7-11) • 36 St. Paul, MN 55155-1298. Periodicals postage Bill Introductions (HF1302-HF1468) • 31 Reflections: Minnesota Territory • 39 paid at St. Paul, MN, and at additional mailing Resources: State and Federal Offices • 35 Minnesota Index: Powering up • 40 offices. POSTMASTER: Send address changes to Session Weekly, Public Information Services, Minnesota House of Representatives, 175 State Office Building, St. Paul, MN 55155-1298. Printed on recycled paper which is 50% recycled, 30% post-consumer content. On the cover: Thomas A. Roman, a professional engineer with ElectroSoft Engineering Inc., makes his way up the front steps of the State Office Building on a windy and rainy April 3 to visit with his legislators about issues that affect Minnesota’s engineers. — Photo by Tom Olmscheid 2 April 4, 2003 IRST READING F★ ★ ★ William Moyers, vice president for external affairs at the Hazelden Foundation, an addic- An extra buck a pack tion treatment and recovery center, said his organization would save more than $500,000 Plan to raise the state tax on cigarettes and other tobacco annually if the state eliminates the health care products clears one House committee provider tax. “We believe in helping people who cannot help themselves,” he said, “but we are convinced that taxing the sick is not the BY JEFF JONES answer.” egislation featuring the words “tax in Provider taxes accounted for 1.4 percent of crease” can expect a cool reception from the state’s budget in 2002, according to the Lmany lawmakers this session, but on nonpartisan House Fiscal Analysis Depart- March 31 one such bill gained a warm, bipar- ment, and are primarily assessed on health care tisan endorsement from a House committee. providers, including hospitals, physicians, den- Starting July 1, purchasing a pack of ciga- tists, psychologists, and others. Money col- rettes in Minnesota would become $1 more lected from the tax goes into the state’s Health expensive if HF29 becomes law. On that same Care Access Fund, which finances the day, the cost of medical care would go down MinnesotaCare subsidized health insurance 1.5 percent because of the elimination of a program for low- and moderate-income fami- state tax on medical providers. lies and individuals. The current tax rate is That tradeoff, according to the bill’s spon- 1.5 percent of a provider’s gross expenditures, sor, Rep. Fran Bradley (R-Rochester), means and is scheduled to jump to 2 percent in the proposed legislation amounts to a revenue January 2004. shift rather than an outright tax hike and Bradley told committee members about wouldn’t run afoul of Gov. Tim Pawlenty’s $260 million in revenue is shifting from one pledge not to raise taxes. House Speaker Rep. tax to the other. Steve Sviggum (R-Kenyon) said he supports However, the fundamental difference be- the legislation as long as it produces a true tween the two taxes — their potential for dollar-for-dollar offset. growth – may change the zero-sum game rela- The bill gained compliments and approval tively quickly. While taxing tobacco is, by de- from House Health and Human Services sign, aimed at decreasing smoking in the state, Policy Committee members and will next go it may ultimately result in lower revenues from to the House Health and Human Services Fi- the tax. The health care provider tax, in con- nance Committee, which Bradley chairs, for trast, is appealing because the income it gen- evaluation of its fiscal impact. PHOTO BY ANDREW VON BANK erates grows consistently as health care costs Under the bill, the tax on a pack of ciga- Jeremy Hanson, from the Minnesota Smoke-Free rise. The sharp increase in costs in recent years rettes would go from 48 cents to $1.48, and Coalition, testifies before the House Health and has made the tax all the more lucrative for the taxes on other tobacco products would rise by Human Services Policy Committee March 31 in state. the same proportion. If passed, Minnesota support of a bill that would raise tax rates on ciga- Bradley said that’s why it has been so diffi- rettes and tobacco. would have one of the highest tobacco taxes cult to repeal. “The provider tax is a really in the nation. Minnesota Smoke-Free Coalition, said the sweet tax if you just look at revenue,” he said. Previous proposals to eliminate the provider proposal would reduce teen smoking by about “It will automatically increase at 10 percent a tax would have used money from the state’s 63,000, or more than 18 percent, and ulti- year. And if you like to expand government general fund surpluses or tobacco settlement mately saving the state $1 billion in medical programs and do more stuff, it fits.” fund to make up for lost revenues, but the pro- costs associated with tobacco-related ailments. Beyond the revenue, however, provider tax jected budget shortfall forced supporters to get Adult smoking rates would also go down an opponents call it bad public policy because it creative. estimated 5.7 percent, lawmakers were told. augments already skyrocketing health care Bradley said a cigarette tax is an appropri- Both aspects of the bill have the support of costs. While it’s assessed on health care pro- ate alternative given Pawlenty’s proposal to medical organizations. Dr. Gary Hanovich, viders rather than patients themselves, the cost drain the tobacco endowment to help balance president of the Minnesota Medical Associa- is usually just passed through to insurance the budget. “It gives us an alternative which tion, said tobacco use is the single most pre- providers and consumers, and state law spe- quite frankly…is superior to anything else ventable cause of death in the country. “We cifically allows them to do so. Language in the we’ve managed to do in terms of reducing the physicians see the disease caused by tobacco bill would require providers to similarly pass incidence (of smoking), particularly among use daily and we hate it,” he said. “The data is along the savings they receive from elimina- young people,” Bradley said. clear: Increasing the tobacco tax decreases to- tion of the tax. Jeremy Hanson, advocacy director for the bacco use and saves lives.” “It’s going to reduce the cost of care by Session Weekly 3 2 percent,” said Rep. Thomas Huntley (DFL- Duluth), who co-sponsors the bill. “That’s not a big amount, but if you have a 15 percent in- crease in your premium, 13 percent is better.” Huntley and other supporters said the pro- vider tax is also one of the most regressive in High places the state, disproportionately affecting low- 1931 case brought Minnesota’s first Supreme Court justice back to his roots income Minnesotans who can least afford higher medical costs. He’s probably not the first Minnesotan to put them out of business, the Legislature Critics argue the tobacco tax is the state’s on the nation’s high court that comes to in 1925 passed a law giving the courts power most regressive because low-income individu- mind, but Pierce Butler was indeed the first to suppress them from injunction.” als are much more likely to smoke than more from the state to serve as an associate jus- Hennepin County Attorney Floyd B. affluent individuals. The Minnesota Medical tice on the U.S. Supreme Court. Olson, who would later become the state’s Association’s Hanovich agrees, but said the But he left indelible marks on the court’s first farmer-labor governor, brought the first costs of tobacco use are even more regressive.
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