Lawmakers compromise on session-ending deal

ST. PAUL -- Establishing a park along Lake Vermilion was part of a deal closing the 2008 legislative session.

Gov. Tim Pawlenty, the project's prime supporter, said $20 million will be given to start the first major state park in decades.

However, negotiations with owner US Steel are not completed, so it is not known how much the state would need to pay for the parkland.

It will be along Lake Vermilion in northeastern Minnesota.

The public works bill containing the park provision was expected to pass as the Legislature ended its work for the year on Sunday.

The governor said that negotiators spent two hours "trying to figure out how do you make good to the counties and the cities on what would have been the developed value of that parcel for the property tax revenue."

To prevent local governments from losing future property tax funds as a result of the sale that would prevent private development on the land, negotiators agreed on a plan to provide St. Louis County as well as local cities and townships a payment in lieu of taxes.

That would be a permanent payment program, but every five years the land would be re-appraised and the payment adjusted based on land value.

The $20 million, which the state would borrow to buy the US Steel land, is close to a state-appraised land value estimate, Bakk said.

Vermillion park is one of Pawlenty's favorite projects, but many in the Legislature oppose it. Sen. Keith Langseth, DFL-Glyndon, long has said he wonders whether the state has enough money to finance a new park because it lacks money to properly operate what it already owns.

Park critic Rep. Tom Rukavina, DFL-Virginia, said nearby Soudan Underground Mine State Park already is along Vermilion, but is underutilized. The lawmaker said that park's lake-front property is better for development than the proposed park's rocky shores.

"I just hope they let the public use the park," he said.

But Rep. Tom Huntley, DFL-Duluth, said he supports Pawlenty's park concept.

"We need to preserve as much lakeshore as we can," Huntley said. "Eventually, you are going to have all the lake surrounded by millionaires. I think we need to preserve some of the lake for average Minnesotans."

Senators approved the public works bill containing park funds 50-17. The House followed 107-26.

Health deal made

Minnesotans should pay less for health care insurance under a plan senators passed 62-5 and representatives supported 127-7 early Sunday.

The bill both adds 7,000 to the MinnesotaCare state-backed insurance program and takes steps to make Minnesotans healthier in an attempt to lower health-insurance premiums.

The measure was not what everyone wanted. Sen. Linda Berglin, DFL-Minneapolis, said senators first voted to add 40,000 people to MnCare and take other stronger measures than the final bill.

"At least we will have more people insured under the bill than we should have without this bill," she said. "They are still steps in the right direction. We never finish the journey without taking the first steps to get there."

Besides the MnCare additions, 5,000 more Minnesotans who meet certain criteria could seek tax credits to buy private insurance.

Tom Huntley said that under the compromise plan, health-care premiums would be 12 percent lower in 2015 than without the bill.

Utility cities get help

A legislative tax package ensures cities with power plants and other utility facilities will not lose significant revenue due to a recent state ruling.

Legislative negotiators and Pawlenty agreed to provide utility host communities, such as Red Wing and Becker, with new state aid to offset losses in property tax revenue that result from a Department of Revenue rule change.

Senate Taxes Chairman Tom Bakk, DFL-Cook, said he sought to help utility communities by making a different tax change, but Pawlenty opposed that, so they settled on the new fund.

"I think the host communities are comfortable with the language," Bakk said.

No Duluth vote

With Pawlenty objecting, a proposal by some Duluth lawmakers to force a vote on the local school district's facility plan was not included in a session-ending deal.

Originally, the proposal would have forced a public referendum on the district's plan to adopt its facilities to a shrinking enrollment, including getting rid of buildings. Then it became a small provision in a 280-page tax bill that said the district cannot collect more property tax than needed to repay up to $125 million in borrowed funds for the district's plan.

Huntley produced a broad smile when told the proposal was not in a final bill. He opposed the state getting involved in the district's business.

"They can go ahead with their comprehensive plan," Huntley said.

The plan will be so far along that there will be no similar legislative efforts next year, he added.