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Continued: Minnesota's GOP legislators rushing to craft state budget

  • Article by: BAIRD HELGESON and RACHEL E. STASSEN-BERGER , Star Tribune
  • Last update: March 27, 2011 - 10:03 PM

Racing to beat tight deadlines, Republican legislators are cobbling together a budget outline that prevents income tax increases but appears destined to prompt a veto by the governor.

In the past two weeks, the process took on the tone of a big, partisan brawl. But what happens next will likely set the stage for the final act of this year's legislative drama, as the two sides careen toward adjournment and a solution to the state's $5 billion projected deficit.

But before that ending, it's going to get messier.

To slash that much money from the budget in this round, Republicans controlling the Legislature are seeking deep cuts in aid to the Twin Cities and steep reductions to health and human services, which could boot thousands of Minnesotans off public programs.

"We're broke," said House Speaker Kurt Zellers, R-Maple Grove. "We're a company that's spending more money than we are bringing in. And we can't go back to our customers, the taxpayers, and say, 'Give us some more money.' "

Legislators have deliberated deep into the night to meet their self-imposed budget deadlines, which could send the proposals to DFL Gov. Mark Dayton in record time.

But the hectic pace and limited time to recheck numbers are igniting scathing criticism by Dayton and DFL legislators that their rivals resorted to "Enron-style" bookkeeping and unproven budget numbers.

The budget is "a fraud" built on "pixie dust," said Sen. Scott Dibble, DFL-Minneapolis.

"They can't do it, they know they can't do it, so they are making up the numbers."

On Monday, the House and Senate will begin voting on their budget packages. From there, the two chambers will resolve differences between their proposals. Then they will send them to Dayton, who likely is already warming up his veto pen.

A veto of many of the proposals would hit the reset button on the legislative session and force both sides to patch together a budget they can all live with by the May 23 adjournment.

The political thunder of March could be long forgotten in the compromises of May.

To move toward a solution, Dayton and the Republicans have to find some common ground. So far, it's not in sight.

Dayton, who favors tax hikes on high earners, says Republicans have proven willing to exact "cruel" and "draconian" cuts on average Minnesotans to protect the richest residents from paying higher taxes.

The rocky road to May

Republicans have targeted the deepest aid cuts at DFL strongholds, such as Minneapolis, St. Paul and Duluth. Republicans say those cities have long consumed the largest share of state aid, a formula that is not sustainable, particularly in tight budget times.

The House wants to slice $1.6 billion from projected health and human services spending. The Senate adds another $200 million in cuts. Both budget bills focus on the dollars available to help poor, elderly and disabled Minnesotans.

The K-12 education bills slightly raise the state's per-pupil funding allocation. But reductions in the House proposal would hit DFL-dominated big cities hardest. The bills also make broad policy changes that clash with Dayton's beliefs, including provisions to limit teachers' collective bargaining rights and freeze their pay.

The House and Senate would both cut funding for the University of Minnesota and the Minnesota State Colleges and Universities system by double-digit percentages. At the same time, Republicans also want to cap tuition increases.

"We lived within our means," said Senate President Michelle Fischbach, R-Paynesville, who crafted the proposal.

DFLers and Dayton have become increasingly vocal about their objections, not only regarding what Republicans would cut, but also how they assembled their budgets.

Republicans proposed balancing the budget in part by tapping pots of money set aside for other purposes, including a firefighters' account and a metro taxpayer-paid transit fund.

Another Republican proposal would draw $60 million from an economic development trust fund on the Iron Range, which if successful would be an unprecedented move that legislators on both sides of the aisle aren't even sure is legal.

"These guys make Jesse James look like an amateur," said Sen. David Tomassoni, DFL-Chisholm.

Disagreeing on the numbers

Some of the biggest budget measures lack independent fiscal assessments that historically serve as the building blocks for a final budget. Others came up far short of the savings Republicans were banking on.

In one instance, Republicans counted on saving $46 million by outsourcing state purchasing duties. The problem is, Minnesota already is recognized as a national leader in efficient purchasing.

When independent analysts ran the numbers, they found that the proposal would actually cost the state $222,000.

Republicans have challenged some of the independent analysis, saying it is tied to the old way of doing things and can't account for innovative solutions. Republicans say they trust their own numbers, which come from results in other states and proposals from private companies that want the state's business.

"Other states have done this, tried it, and have been successful," Zellers said. "We are not reinventing the wheel."

Republicans also are relying heavily on getting federal waivers on Medicaid rules to save hundreds of millions of dollars.

State officials said they don't believe the state will be granted the waivers, noting that some of the proposals could violate federal laws. Even if Minnesota gets the waivers, there's no proof that savings would result.

More than $1 billion of the Republican cuts "are make-believe money, not quantifiable in any way," said Sen. Dick Cohen, DFL-St. Paul. "This has never been done in the history of the state Legislature, in my time here, ever, ever, ever."

Republicans say they won't be surprised to soon see Dayton's veto pen.

"If he doesn't sign this one," said Rep. Tony Cornish, R-Good Thunder, "he'll probably sign the next one."

Eric Roper, Bob Von Sternberg and Jenna Ross contributed to this report. baird.helgeson@startribune.com • 651-222-1288 rachel.stassen-berger@startribune.com • 651-292-0164

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