By Marlowe Hamerston

The 2007 legislative session has ended with a thud. Gov. Tim Pawlenty has vetoed two tax bills, leaving the only hope for any reform in a special session, which appears highly unlikely.

The session had barely closed when both political parties began their travels around the state trying to absolve themselves of the responsibility for failing to act on what was proclaimed to be the number one issue during the last election: property tax reform.

I prefer to assign blame to the stealth culprit - Mike Huckabee, governor of Arkansas and Republican candidate for president of the United States. Huckabee’s greatest claim for his candidacy is that he has resisted state increases in taxes. Sound familiar? How else to counter a candidate who resists tax increases but to get support from another governor who has done the same.

Enter candidate John McCain. Who could better counter the tax resistance position of Huckabee than tax resistance devotee, Gov. Tim Pawlenty? What better way to improve Pawlenty’s position as an opponent of tax increases but to veto just about every spending bill coming from the DFL-controlled legislature.

What better scenario for the Republican convention to be held in St. Paul than to have the bright, attractive, tax-fighting governor of Minnesota second the nomination of candidate McCain.

Protestations aside, how could Pawlenty not be the man McCain would choose for vice presidential candidate and how could Pawlenty turn down the call of his party and the country to run for vice president?

One can easily argue that the vetoes to the omnibus tax and transportation bills were not because of the addition of another tax rate or the inclusion of a cost-of-living factor. The reason was Mike Huckabee! The reason was the positioning of candidates for the 2008 election. The promised property tax reform became a casualty of political maneuvering for the 2008 presidential election.

The first omnibus tax bill’s increase in income tax rates for the upper income earners was justified. Those in the top ten percent of income earners (those earning over $700,501) contribute on average four-tenths of one percent of their income in support of local government and schools. Minnesotans in the bottom ten percent of income earners (those earning less than $32,471) contribute on the average 2.73 percent of their income to support local government. Surveys have shown many in the bottom ten percent of income earners have property tax obligations dramatically above the average - up to 20 percent of their income even after taking part in the present property tax aid programs.

It is absurd that such a spread exists between percentages of income taken to support local government. Fairness cannot be achieved within the framework of the present market-value property tax system. Authors of the reform deemed that an exchange of an increase in the income tax for those Minnesotans earning in the top percentiles, for property tax relief for those property taxpayers in the lower percentiles, would be a fair exchange. It was a fair reform and should have become law.

When this legislation was vetoed, the legislature had two more chances to fulfill their campaign promises to enact property tax reform. First, the veto should have been overridden if legislators had voted the interests of their constituents.

Eight Republican representatives had no constituent in their hometown earning enough to be affected by the increased tax rate. These eight representatives had from 9 percent to 29 percent of their hometown constituency consist of senior citizens - the very people that the proposed property tax reform would help. Thirty Republican representatives have constituencies where less than 1 percent of the population would be affected by the increased tax rate. All that was needed to override the veto in the House was six Republican votes.

In the Senate, where one vote was all that was needed to override the veto, there were 16 senators with fewer than 1 percent of their constituency who would be affected by the increased tax rate. The fact that the DFL strategists did not even take a vote to override the veto raises doubts as to the sincerity of their property tax proposals. Their backup proposal did not address the governor’s objections, so what purpose was served by abandoning a good reform for a hodge-podge tax bill which was known also to be headed for a veto? There may have been enough Republicans who would defer to the interests of their constituents and vote to override, but we shall never know because the vote was never taken.

All of the conjecture just outlined put aside, the DFL could still have passed the House reform. There are other sources of funding for the reform. The funding for the property tax portion of the House reform bill amounted to about $224 million in new money. The proposed legislation sunsets the Market Value Credit program over the next three years. If this program were ended now, it would free up $273 million. This would not only cover the cost of implementation of the House’s proposed property tax reform, it would enable the establishment of a limit to the property tax to 5 percent of a senior’s income. This combination legislation would not only benefit 90 percent of Minnesota low-income property taxpayers, but also would enable the senior citizens of Minnesota to remain in their homes. All of this is accomplished without an increase in the income tax or any other tax.

This has become a battle of wills - Pawlenty to not raise taxes and the DFL to force him to break his promise not to raise taxes. If the DFL is sincere about property tax reform, they should pass the House bill using monies that are available. The game of “chicken” must end. The interests and welfare of the citizens of Minnesota are being ignored in this game of political gotcha.

It is time for the executive branch and legislative branch to stop this foolishness, take a deep breath and get back to what they were elected to do - represent the interests and needs of the people of Minnesota by creating fairness in property taxation.