Editorial: Three must-do items on Capitol docket

It's crunch week at the Capitol. The six working days remaining until the Legislature's required Monday adjournment will reveal the sincerity of all those start-of-session promises about working in bipartisan fashion for the good of the state.

Three top tasks remain. The work of GOP Gov. Tim Pawlenty and the DFL-controlled Legislature won't be complete unless they balance the state budget, contain health-care costs and advance the development of a modern mass-transit system in the Twin Cities.

Action on one or two of the three won't do. In fact, it's not an option. While the three issues are not substantively intertwined, they have been politically wedded by an insistent governor. If there's no deal on the budget, Pawlenty vowed Monday, there will be no Central Corridor rail funding this year, and health-care reform will be seen as "problematic" when it reaches his desk.

The encouraging news is that at this writing, negotiations continue, and enough time remains to end this session well. This is the outcome we're rooting for:

•A budget deal that raises revenue by closing a foreign operating corporation tax loophole and makes permanent spending cuts of at least $355 million in fiscal 2009. That's the number that House and Senate conferees have agreed to accept.

The budget tussle in recent days has focused on Pawlenty's demand to cap next year's property-tax increases at 3 percent or the inflation rate, whichever is less. That's less than half the average increase forecast for city, county and school levies next year.

DFLers have been right to resist. A state restriction on local financial autonomy is bad policy. Pawlenty's proposal would leave many local governments, particularly those that rely on state aid, unable to keep up with inflation. Higher fees are a sure result.

But in the past, creative legislators have satisfied the political demand for a property tax cap by allowing exceptions for population and commercial growth, debt service and more. They've also tied the limits to a state aid increase. A similar accommodation, making bad policy easier to swallow, should be possible.

•Health-care reform that puts into law many of the ideas advanced earlier this year by two bipartisan study groups. Though the bill awaiting action Monday doesn't go as far as those groups recommended, it still is projected to shave 10 percent off health-care costs by 2015. Dr. Robert Meiches, CEO of the Minnesota Medical Association, calls the package "historic."

The bill employs a variety of measures that bend, but don't break, the state's existing health-care system. Among them: public reporting of treatment prices and outcomes; electronic medical records; financial incentives for providers to keep patients out of the hospital, and larger insurance pools, in part through expansion of eligibility for the state's low-income insurance program, MinnesotaCare.

Pawlenty initially resisted that last point, but has softened his position in negotiations. A solid budget deal should soften it some more. This opportunity is too potent to pass up.

•$70 million in bonding for Central Corridor, sufficient to leverage $450 million in federal funds and begin its construction in 2010. The light-rail line between downtown Minneapolis and downtown St. Paul is the anticipated spine of an eventual network that will combine with enhanced bus service to give metro Minnesotans more chances to leave their cars behind. Rising oil prices and environmental concerns make building this system urgent business.