At the State Capitol, it’s tax cuts vs. education spending vs. savings. That’s the nutshell version of a three-way state budget battle that took outline form Friday, as the Senate DFL majority issued its spending targets for 2016-17 just before departing for a 10-day spring recess.
A $3 billion spending gap between bids by DFL Gov. Mark Dayton and the House Republican majority, released earlier, gave senators ample opportunity and good strategic reason to land in the middle. They did, but chose a position much closer to Dayton than to the House GOP, spending only $250 million less than the governor proposes.
But in state budget parlance, some “spending” is savings. The Senate majority would add $250 million to a rainy-day fund that now sits at $1.35 billion, and which experts say should be at least $2 billion given the instability of the state’s tax revenue stream. Senate DFLers also would restore a payment schedule to local governments that was altered a generation ago to push a portion of payments into future budget periods. Undoing that shift creates a one-time expense of about $225 million and would re-establish a hidden reserve — that is, an obligation that could be delayed again to cope with a state deficit.
Taken together, Senate DFLers are proposing that about a quarter of a forecast $1.9 billion surplus for 2016-17 be socked away. That’s admirable prudence, given the notorious volatility of the fund on which Minnesotans depend for the lion’s share of education, public safety and social services spending.
The Senate’s richer reserve comes at the expense of education spending relative to the governor’s budget and tax cuts relative to the House GOP. The Senate’s education bid is $425 million less than Dayton’s; its tax cuts are only about one-tenth the size of the House GOP proposal.
Committee work to flesh out those divergent outlines will begin in earnest when legislators return to the Capitol on April 7. The Legislature’s break until then provides Minnesotans with prime time to express their budget preferences. Many legislators will conduct listening sessions in their districts next week to sample public opinion; all of them will be paying particular attention to phone, mail and e-mail messages from constituents. Now’s the time to send yours.