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Martin Olav Sabo, former state House speaker and current 5th district congressman, speaking at a Citizens League breakfast. Federal topics of address included taxes and budget. Sabo also talks of state issues including development of urban areas, social service funding, energy, and health care funding. Sabo then mentions highlights from previous state legislative session.

Read the Text Transcription of the Audio.

(00:00:00) I will view with interest how the 1979 legislature (00:00:05) proceeds. Particularly (00:00:09) the proposals to cut state income taxes by 10% eliminate the sales (00:00:14) tax and the purchase of farm machinery and equipment (00:00:17) the same time that we moved to a ratio of 15 (00:00:20) to 1 and all the schools in the state. (00:00:24) Balance the budget I assume not cut the (00:00:27) guts out of other basic governmental services in the state and accomplish it without any political cronies, which I assume means the involvement of anyone who has been elected to public office previously has run for public office and been defeated or helped elect anyone to public office in previous years. I think there will be an interesting experiment and watching how state government may work and I'll do it from a certain distance with interest. I would however suggest for issues which in my judgment remain unresolved in the state and I mentioned those because (00:01:08) they're have some interests to me (00:01:09) and and they're by no means the end of a (00:01:13) list. I remain convinced that the (00:01:16) question and Redevelopment in urban areas, whether it's in large urban areas like this one or in smaller towns and cities throughout the Remains a major unresolved question. We (00:01:27) tried to move in 1978 to limit and regulate tax increment funding. I think (00:01:34) we're headed in the right direction. I (00:01:36) remain convinced that tax increment (00:01:39) is not a good tool for redevelopment in urban areas how it should be replaced. I am not certain. (00:01:47) I was convinced that the only way we began to with some imagination explore (00:01:52) Alternatives was to (00:01:54) First limit tax (00:01:55) increment and then I thought we could move on to the question of the proper State role and working with local communities that remains unresolved. I think it's a major issue. (00:02:06) I think the question Social Service funding in the state remains unresolved. I think clearly the issues raised by house file 1 (00:02:14) will remain and will remain for a long time. I think it'll serve as a (00:02:18) focal point talking about social service funding in our state. It's no longer sort of a minor. Significant thing it's major are inequities in the process. There are basic question as to who (00:02:31) raises the money who runs which programs between state and local government and particularly County government. I believe that issue remains unresolved whole (00:02:40) question of energy. I think it's fair to say that Minnesota has probably done as good a job as most any other state in trying to deal with the energy energy question the other hand they're just (00:02:54) major issues unresolved. (00:02:56) One of the reasons we created the select committee on energy and the house (00:03:00) last year was our clear (00:03:03) clear impression from following energy bills and 7778. They'd end up in one committee and other committee and clearly huge interrelationship between the impact of energy and a variety of committees (00:03:17) within the legislature. I think it was also clear (00:03:20) that we tended to go out of piecemeal and we really didn't have Any great concept and what direction should we should go in the future? I guess frankly because I'm not going to be there in 79. I have not followed the recommendations of the select committee that closely but I think regardless of what their recommendations maybe I (00:03:40) think we've increased the awareness the knowledge and understanding of the energy issue of by members of the legislature. I think that's going to remain one of the most difficult issues for the legislature to deal with not only in 79, but for many years and ahead (00:03:54) one of the issues that I had hoped to develop sort of a (00:03:58) my unfinished agenda on on state level was the (00:04:02) whole area of healthcare funding that we moved in a major way in 1976 with the Comprehensive Health Insurance act. I remain I continue to have a certain skepticism (00:04:16) about whether federal government is ever going to put a system of payment for health care costs and place and federal level (00:04:22) and I thought that what we did in 1976 was a beginning step in Minnesota. (00:04:27) I think it's a program that could be built on and (00:04:31) develop in such a fashion (00:04:32) the Minnesota could develop their own system of healthcare funding and really not much work has been done on that. I (00:04:39) think it's potentially (00:04:40) major and very important issue state of Minnesota. What about some of the major accomplishments over these previous (00:04:48) years. I'm going to list 12 if I'd sat down at some other point of time. I might well have listed different 12 than I list this morning and I'll run through them and rather sketchy fashion so that (00:05:01) if you have some questions, I'd be happy to respond and I guess fundamentally. I'm very proud of the record that we've produced over the last six eight years. I think it's move the state forward. (00:05:13) Major way let's let me just indicate a few of them. Number one. The growth of the legislature is an institution 1972 was the passage of the Constitutional Amendment (00:05:23) providing for the flexible session. I think the legislature has grown both House and Senate as a major governmental institution. (00:05:31) It wasn't their prior to 1972. It had begun to (00:05:35) develop around 1967 or so. (00:05:39) I think if you went back from that period of time you could go back years and find relatively little (00:05:44) change in the in the nature of the legislature as an institution. It's grown (00:05:49) immensely I think today and in the house, I think it's also true of the Senate they're (00:05:55) good administrator framework in (00:05:57) place, then quit built staff highly professional very qualified staff (00:06:02) both as it relates to our Appropriations Committee as it relates to how this research as a relates to caucus (00:06:07) stat (00:06:08) and you know, there are (00:06:09) some people who still hope and somehow think the (00:06:13) Teachers should (00:06:13) move back to those good ol Days when the gentleman farmer came for a few months and Todd about state government and then went back home and forgot about state government for a year and a half those days are gone. They'll never be back and I think it's good that they'll never be back. Thank the legislature one of the major ingredients in developing strong state government as having a strong State Legislature and despite the problems of his even split in the house this year. I think that's happened (00:06:44) Minnesota. And I think it's going to continue for the long range future (00:06:47) think the major fiscal revision 1971 and the succeeding years is probably one word to list any one major thing clearly had more impact than any other. I'm proud of those changes. I think we have a better coordinated State local tax system and fiscal system because it's really a combination of both how you raise money and how you spend it and coordinating those in Minnesota and in virtually any other state in the country. (00:07:13) Country and if you want to look at the total opposite look at the state (00:07:16) of Ohio and stayed Cleveland City of Cleveland today (00:07:20) or look at the problems of New (00:07:21) York. I think we have a basic good system in place in (00:07:25) Minnesota. It's going to require (00:07:26) constant tuning constant (00:07:28) work. The basic framework is (00:07:30) there I would list again or this Comprehensive Health Insurance Act of 1976 was a bill that really didn't receive much attention. It (00:07:39) is Major in school (00:07:41) provides catastrophic health insurance coverage and mandates a private (00:07:45) insurers offer a good insurance (00:07:48) mandates option of (00:07:50) hmos within Group insurance. (00:07:52) I think has a Major Impact in ensuring decent system for paying health (00:07:56) care bills for (00:07:58) the vast majority of minnesotans. There still is the (00:08:00) gap of people who who are not covered. However, and but that was a major step forward (00:08:07) Croatian State housing program in 1970. There was no (00:08:13) State housing program state of Minnesota. It was (00:08:16) one of the priorities Governor Anderson his State of the State message in his budget message in 1971. It was passed and it's developed into one of the best housing programs in the country combination of both the bond money and the direct appropriation (00:08:31) which started in 1975 (00:08:34) election law (00:08:34) change (00:08:36) and that tends to draw lots of partisan (00:08:39) rhetoric rhetoric over the years. (00:08:42) Frankly. I think the changes we've made our have been major and I think there have been (00:08:47) major improvements to how we conduct the elections in this (00:08:50) state party designation for state legislators was a long time coming finally came 1973 election day registration to encourage and make more accessible the voting booth two people came in Minnesota in 1973. I think it was step forward. Campaign reporting and public financing of campaigns major step forward. I think it's a good law that's in place. I make no apologies for it. And I think the clearly we have to (00:09:18) move in the same direction Federal level. (00:09:21) I was shocked as I went to (00:09:23) some of our freshman (00:09:23) orientation and frankly the public financing aside from its impact. It's only way you can limit how much money is spent. I find fundamentally frightening what's happening with expenditures Republic for campaigns in this country. I want to our freshman orientation. I met colleagues who are elected in some who'd spent a quarter of a million dollars to get elected Congress and had been out spammed. I find that just fundamentally frightening and I think we (00:09:51) have to move it Federal level (00:09:53) some type of Public Funding. If for no other (00:09:55) reason that that's the way we can begin to limit. (00:09:58) How many dollars are spent in these campaigns the strengthening of our Metro system has occurred that's been going on (00:10:05) for a good number of years. But in recent years, we've had the council reorganization creation Metro open (00:10:11) space law, which I think means that we're (00:10:14) moving in this area preserving some of our open space for future Generations (00:10:19) BWC a May attract a lots of media attention lots of controversy (00:10:24) fundamentally for the people who live in our area. It's equally important that we could (00:10:29) maintain some open space that they can drive to and be back in the same day. I suspect that our open space in this area will serve many more (00:10:38) of the people who live in the metropolitan area than whatever happens would be WC a (00:10:43) state Rule and Transit funding which came in 1975 don't know that any state his (00:10:49) Is involved in (00:10:50) providing State funds for local Transit the state of Minnesota, maybe some of the larger States. I'm not sure but I (00:10:56) don't know that any other state of our size is (00:11:00) increase production tax on taconite and major increase in production tax attack night through the part of it in 75 and party 77 met in The Mensch natural resource of Minnesota that's being depleted in my judgment was being totally undertaxed. It clearly is not being taxed very highly today the production tax and taconite which is in lieu of the property tax is about the equivalent of the four percent sales tax on its value in contrast to the rate of taxation of coal by (00:11:34) many of our neighboring states such as North Dakota and Montana or I believe the rates are at the neighborhood 25% third 33 and a third percent still a very modest tax, (00:11:45) but it involved very substantial increase of that tax in the state of Minnesota. And we also managed in the last session creates (00:11:53) some funds with the resources. They aren't all spent immediately. (00:11:57) One of them is a long range fund, which is basically Put aside as a trust fund to be used (00:12:02) again for the local communities involved (00:12:06) when the point time (00:12:07) comes attacknids gone. I think it was a major Improvement (00:12:11) and the fact that we've increased the production tax as a local tax the local property tax now their hand has substantial impact on state revenues because just as the Navy other community if you have (00:12:24) commercial growth or growth in your assessed valuation reduces school age, so there's indirect benefits and savings to state government (00:12:32) senior citizens program think it's fair to say that no state treats senior citizens better in the state of Minnesota does (00:12:39) whether it's terms of Nursing Home Care regulation Services provided or tax program to make sure that people in their older years are provided for decently (00:12:50) pension benefits and funding and state of Minnesota that all of a sudden that issues become (00:12:54) visible. I read with interest a series of Articles and Star Tribune. I forget to which one (00:13:02) I said I (00:13:03) should never admit that I guess were there but they sort of blur, you know, (00:13:10) the leak anyone like that. (00:13:16) You know, I read those articles with interest and they point out major problems and then at the little and quite often and many of the problems. They describe a little sentence said the (00:13:25) 77 legislature changed this provision (00:13:28) 75 session past change this provision fundamentally. I think public employees (00:13:34) in the state are fairly well and (00:13:36) fairly provided (00:13:38) for as a relates to retirement benefits, (00:13:41) we made major benefit improvements in 1973. You know it my judgment is we attack the problem poverty in this country. Nothing's more important to having decent pensions for (00:13:50) people, (00:13:53) you know, probably the (00:13:54) biggest biggest group (00:13:58) of people in poverty historically been older people and one of the reasons is they had no money for retirement. I think we provided good Fair pension benefits for public employees in the state. I think that's important the other hand. I think we've also tried to deal with the question of how you pay for them and (00:14:15) responsible way the (00:14:18) funding level of our pensions in this state are better and Most (00:14:21) states. (00:14:23) We've also dealt with you know, if I could go back one hindsight. I wish we wish we would lump some things together this last session we change the taxation of public pensions were clearly. What we did was the right thing. We had. I thought what was a (00:14:38) horrible situation Minnesota previously. (00:14:40) We said that every private pension was subject to State taxation as they are federal taxation, but all public pensions were excluded from State taxation while all private pensions were subject to him. Totally unfair in terms of equity between the public and private sector and I always sort of scratch my head in amazement during this last campaign when the political party who supposedly prefers the private sector was attacking us for changing taxation law. So the taxation public and private pension state of Minnesota were (00:15:14) identical but I think it's been a major Improvement for the (00:15:17) benefit many many (00:15:19) people in this state and continues (00:15:22) to have some problems but (00:15:23) I think we made major progress both in the benefit side and on the funding side of pension state of Minnesota (00:15:30) and finally and not (00:15:31) least of all by a long shot in terms of what we've done with state government. I think we strengthen the role of the governor. I said first the legislature which I guess reflects my background of the (00:15:42) past 18 years, but equally important I think we're fundamentally (00:15:46) strengthened the role of the governor in terms of appointments (00:15:50) the governor today. The department heads serve (00:15:52) at the pleasure governor. (00:15:54) Equally provided for more on classified (00:15:56) positions in state government. (00:15:58) I think that's good. Not bad. I fundamentally believe in the elective process and I believe that somebody who's elected selected attempt to govern and as part of that process. They need to be able to appoint people and select people (00:16:12) to serve and their administration's that are attuned to them have some loyalty to (00:16:18) them and if (00:16:21) if I couldn't make it any more clear, I (00:16:23) fundamentally totally disagree with that basic concept of cronyism that I (00:16:28) talked about earlier that creeps into all our political record all our political rhetoric, you know, I fundamentally believe that involvement in political processes good I think given (00:16:41) fairly co-equals to have somebody appointed in State (00:16:44) office who's pounded the door and behalf of a candidate is preferential to having someone who's never done it. I'm always reminded of the old story of Lyndon Johnson. (00:16:54) Sam Rayburn Kennedy was first elected Lyndon Johnson going to see his (00:16:58) friend Sam Rayburn talking about these great folks coming from the large industries of this country from the great Ivy League schools into the Kennedy administration in Old Sam leaned back in his rocking chair and saying I sure wish one of them had run for sure if once and I think there's great virtue in (00:17:16) that and I think today the (00:17:18) governor of this state has much greater flexibility in picking people that he or she may choose to help them govern this state. Now, I fundamentally believe that it's very important that we develop the elective positions in state government and the federal government, you know, the historic discussion quite often (00:17:37) is between the the conflict between the executive and (00:17:40) legislative branch of government. I think a much more fundamental conflict within government is the ability of elected leadership whether it be (00:17:49) executive or legislative to fundamentally have impact and (00:17:52) manage the flow of I think that's most important conflict in our system. I think the only way you deal with it is putting some strength in both the executive and legislative branch of government. I've probably talked pulled too long already. (00:18:06) Just let me make this comment variety of federal programs. I just still describe myself as a liberal the centralist (00:18:14) not quite sure what that means. I don't think there are many of us around (00:18:18) and I'm waiting to see how that fits in the Washington scene. I think fundamentally probably what it means is that the concept of having one level of government raising money and other (00:18:30) spending it bothers me less than it does a lots of people who call themselves either liberal Central lists or conservative these centralist (00:18:38) what (00:18:40) and so I look forward to the new (00:18:43) challenge. Working Congress I think will be interesting. I look (00:18:47) forward to it with anticipation.


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