Hints of an agreement have Capitol on standby

Action on bills that could change Minnesotans' taxes and alter programs they depend upon came to a halt Monday amid hints of progress in negotiations for a "global agreement" to resolve the major issues of the 2008 legislative session.

As legislative leaders huddled with Gov. Tim Pawlenty and his commissioners off and on throughout the day, the House and Senate focused on policy legislation.

After talks Monday morning with Pawlenty about how to address a projected $936 million state budget deficit, DFL leaders said they had agreed, at least temporarily, to his request to hold back several parallel budget bills that had been scheduled for votes.

Through the afternoon, the House and Senate voted on a range of measures that do not affect the budget, including regulations for surrogate mother contracts, legislative pay, pool safety and dangerous dogs.

The focus of Monday's negotiations was property tax relief. Pawlenty has said a cap on local property taxes is a linchpin of any budget deal. House DFLers have pushed for income-based property tax relief to homeowners, while Senate DFLers have focused on aid to local governments.

No action was taken on that front Monday as legislative leaders said they needed more information on levy limits before voting. House Speaker Margaret Anderson Kelliher and Senate Majority Leader Larry Pogemiller met with Pawlenty late Monday and said he assured them they will get the necessary information today.

Pawlenty said he had asked legislative leaders to hold off on the budget bills as staff members wrestled with the intricacies of the proposals.

The governor cleared most of his schedule Monday and said he remained available for talks and hopeful. But he cautioned lawmakers about moving ahead with their own budget plans, which could trigger vetoes and thus create a logjam.

Chances of special session?

With only a week left in the legislative session, that in turn could necessitate a special session to balance the budget. Pawlenty could also unilaterally cut the budget in a process known as unallotment. He said his office already has completed exercises on making it happen.

"The Legislature is poised to do their own thing again," Pawlenty said. "They've loaded up all these bills kind of like last year, halfway there and decided to go their own path. I hope we can continue to negotiate, but if they choose to pull the trigger and move those bills forward, it will end a lot like last year, which for me was a pretty good ending, by the way," Pawlenty said.

The 2007 session ended with Pawlenty vetoing a flurry of tax and policy bills.

Still unresolved is the fate of the Central Corridor light-rail line, planned for between Minneapolis and St. Paul. Pawlenty line-item vetoed a $70 million bonding proposal that supporters say is key to leveraging additional federal money for the project.

"I don't feel any pressure about it. First things first. [If] you can't balance the budget, we certainly can't afford things like Central Corridor and expanding social services programs in Minnesota. We don't have a budget deal, there won't be a Central Corridor -- this year," he said.

More money for schools

Among the bills that were awaiting action Monday night was an education finance measure that emerged from a conference committee over the weekend.

The bill would give school districts an extra 1 percent in basic funding for 2008-09. That, said Rep. Mindy Greiling, DFL-Roseville, and chairwoman of the House K-12 Education Finance Division, amounts to an extra $51 per pupil.

The money would come on top of the extra 1 percent in general funding already approved for schools by the 2007 Legislature. School officials have complained that the 1 percent funding bump currently offered them is insufficient to keep up with rising costs.

Greiling said the idea is to freeze use of the Q Comp fund, which was set up to fund school efforts to change the way teachers are paid, and use that unspent money for the across-the-board increase.

Limiting Q Comp could well provoke a veto from Pawlenty, who has championed giving teachers merit raises in place of the current raises given for additional years of experience and piling up college credits.

"This gets the money out to every single student in the state," Greiling said. "Now, we have 340 districts in the state, and Q Comp goes to about 60 of them."

Mark Brunswick • 651-222-1636