Pawlenty to propose cuts with new budget forecast

  • Article by: Associated Press
  • Updated: December 2, 2008 - 9:25 PM

Gov. Tim Pawlenty warned Tuesday that he expects a shortfall in Minnesota's current state budget -- not as big as the shortfall anticipated for the upcoming budget but enough to require cuts in the coming weeks. Pawlenty said he will propose trims on Thursday, when finance officials release a budget forecast.

Legislators and analysts are expecting a deficit of as much as $4 billion to $5 billion for the budget period starting in July. Few have focused on the current budget, which includes almost $35 billion in spending approved by the Legislature in the past two sessions.

The current budget runs through June 30, so most of the money is already spent.

While Pawlenty declined to quantify the near-term deficit, he said he expects it to be "noteworthy" but not "unmanageably large."

The Republican governor said he aims to work with the DFLers who control the Legislature to identify spending that can be pulled back within the next few weeks. He said he could also make cuts on his own through an executive power called unallotment.

State law allows the governor to drain the state's budget reserve and then delay, reduce or cancel unspent payments to cover a deficit. The reserve currently has $155 million, according to Minnesota Management and Budget agency, after legislators and Pawlenty tapped it to cover a shortfall earlier this year.

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