Minnesota tax cuts? Health insurance relief? Lawmakers have plenty to do in 2017

Jan. 02--Minnesota's newly elected lawmakers kick off the 2017 legislative session on Tuesday with big changes.

They'll be back in the state's 1905 Capitol after a multiyear restoration project.

And Republicans will be back in the saddle after taking control of the state Senate in the November elections. That will likely set up showdowns with Democratic-Farmer-Labor Party Gov. Mark Dayton on multiple issues.

Here are some of the big issues expected to occupy lawmakers between Jan. 3 and May 22:

BUDGET

The big picture: Lawmakers and Dayton must agree on a two-year state budget before the end of May or the state government will shut down. In December the state's budget experts predicted a $1.4 billion surplus, or about 3 percent of the state's projected $45.3 billion in revenue.

Tax cuts: Both parties want to spend some of the surplus on tax cuts, and have a deal in place from last year that could pave the groundwork. But while Democrats are championing a set of targeted tax reductions, Republicans have much grander ambitions for returning money to taxpayers.

Transportation: All sides want to drastically increase spending on roads and bridges, but Republicans and Democrats have significant differences about how to pay for the spending and how much, if any, should go to transit.

Infrastructure: An unfinished plan from 2016 to borrow $1 billion for roads, water projects, state buildings and more could be back on the table, or could be pushed back a year.

HEALTH CARE

Health insurance: In the short term, both parties want to strike a deal to spend as much as $300 million providing relief to an estimated 100,000 Minnesotans facing skyrocketing health insurance premiums. In the middle term, expect efforts to stabilize the state's individual insurance market by insulating the market from the very sickest patients who contribute to spiraling costs.

Affordable Care Act: The new Republican-controlled Congress in Washington is expected to repeal the 2010 Affordable Care Act and -- eventually -- replace it with new laws. Whatever they end up doing could require a response from states, but Congress's direction might not be clear before the Minnesota Legislature goes home in May. That could push the issue back to a special session or to 2018.

Health and human services spending: Republicans plan a big push to rein in the state's spending on poor, sick and disabled Minnesotans, which has grown from 21 percent of the state's budget in 1990 to 30 percent in 2015. Some Democrats are open to this, but Dayton says the state should increase its spending in this area to help people in need and to relieve pressure on local governments currently dealing with them.

EDUCATION

Teachers: Both parties want to overhaul the way Minnesota licenses teachers to make the system more fair for educators trained in alternative programs and out-of-state. They also need to deal with a growing teacher shortage in key specialties like science and special education.

Achievement Gap: There's widespread agreement Minnesota needs to do more to close its nation-leading achievement gap, but a lot of debate over the best way to do it. Democrats and Republicans both support increasing access to early childhood education and academic support programs.

School funding: When it comes to public school funding, roughly 40 percent of the state's general fund budget, education advocates hope they'll see another increase in the general funding formula that supports classroom costs. Republicans also want to spend money more efficiently and give districts more discretion over how they use the the state money they receive.

ENVIRONMENT AND ENERGY

Buffers: Gov. Mark Dayton hopes to build on the 2015 law to protect lakes and streams from runoff by establishing buffer zones, but some Republicans want to scale it back.

Regulation: Republicans believe the state is standing in the way of much-needed energy, mining and forestry projects and want to make it easier for them to get approved.

OTHER ISSUES

Sunday liquor sales: The coalition pushing to legalize packaged liquor sales on Sundays hopes turnover could mean victory in 2017 after years of fighting, and House Speaker Kurt Daudt has predicted the measure will pass at least the House this year.

Child care: Many communities in Greater Minnesota say access to affordable child care is becoming a crisis, and the rural-heavy Republican majorities may respond.

Preemption: Big cities such as Minneapolis and St. Paul have passed policies on paid sick leave and minimum wage in recent years, and some in the business community would like to see the state block cities from making their own policy in these areas. Dayton says he's open to this only if the law also puts in place acceptable statewide policies in these areas.

Christopher Magan contributed to this report.

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