Pawlenty, DFL still at odds over budget

Gov. Tim Pawlenty and DFL legislative leaders went back to the bargaining table on Saturday but the two sides are no closer to a compromise.

Pawlenty presented a budget offer yesterday despite his announcement that he will balance the budget on his own if an agreement can't be reached.

The main disagreement remains over the best way to plug a $4.6 billion budget gap.

Even though a budget deal wasn't reached, Pawlenty did revise his offer to balance the budget. He wants to delay payments to schools and cut $450 million in aid to cities and counties. Pawlenty spokesman Brian McClung said the governor also proposed another $250 million in cuts to health care programs and a $190 million cut to higher education.

"We would expect and hope that the Democrats will return with a compromise offer of their own," he said.

They did, but not until after holding a marathon committee hearing to discuss the impacts of the governor's proposal. Local government officials, health care representatives and college officials all testified about the pain of the reductions.

"The cuts would be really savage and severe," said University of Minnesota President Bob Bruininks. He told lawmakers that absorbing additional cuts would mean a large tuition increase and the elimination of hundreds of university employees.

"I think they would really cost the state money, cost the state opportunity and cost additional jobs in the private economy so I think it's a really bad bargain," he said.

Others told the committee that cuts in aid to local government will mean an increase in property taxes and a reduction in services. Floodwood Mayor Jeff Kletscher was one of several mayors urging lawmakers and the governor to craft a deal.

"My toolbox is empty. We've been facing this for years," Kletscher said. "I have a very poor community and we can't afford to see tax rates go up for those folks. We need people down here to come to an agreement that holds us harmless, helps us in any place we can because there's just no place to go." Advocates for low-income people told lawmakers that Pawlenty's line-item veto that eliminates a health care program for the poor in 2011 will be devastating. They're hoping lawmakers restore the program. As the day wore on, lawmakers started to become more frustrated. Republican Representative Tom Emmer of Delano questioned DFL House Speaker Margaret Anderson Kelliher on why they were spending so much time taking testimony with just three days remaining in the session. "It's very important to us that we get to the business of getting done instead of putting on theater which seems to be attacking every number that has been offered here today," Emmer said.

"If you think this is theater, I would like to mention the people who would lose their health care," Kelliher replied. "The people that we heard about who could die. The people who may not afford to go to college based on these choices."

Lawmakers and the governor are working to craft a budget deal before Monday's deadline. If one isn't reached, Pawlenty says he'll use his emergency authority to cut spending. On Saturday, he signed a bill that funds schools and line-item vetoed $2.6 million from the Higher Education and Ag and Vets budget bills.

He also trimmed $85 million from a $300 million capital investment bill. Most notably, money for the University of Minnesota's Bell Museum, new building projects and the Schubert Center for the Performing Arts were cut from the bill.

Even though the governor has ruled out tax increases, DFLers continued to press for $1 billion in more revenue. They said the funding could come from fees, surcharges or taxes.

Minnesota Management and Budget Commissioner Tom Hanson rejected the proposal.

"We felt like we took a step toward to you this morning and in trying to figure out what we could do and focus on that and it seems like you just took one big step away from us."

Hanson later said lawmakers should agree to a K12 shift and the cuts they can agree to and disregard everything else.

One thing DFL leaders and the governor do agree on is that revenue from gambling should not be used to balance the budget. They said they said it was discussed in the private meeting and rejected. Republicans in the House and Senate said they should send a gambling bill to the governor to see if he'll support it.

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