GOP majorities lay out tax cuts, less spending in budget

The public got its first glimpse Thursday at how the new Republican majorities in the House and Senate intend to erase Minnesota's $5 billion projected budget deficit.

For months, Republicans have said that they can balance the budget by spending only as much as the state is already collecting in revenue, and they intend to take in even less.

The Senate budget outline includes $200 million in tax cuts for businesses. House Republicans want to cut $300 million in income taxes on low and middle class Minnesotans. Republican House Majority Leader Matt Dean, of Dellwood, said GOP legislators will rally behind the plans.

"I think we have strong caucus support both in the House and Senate," Dean said. "We have one plan that's before us that's realistic so we're moving ahead."

But the level of cuts included in the plan may give some heartburn to some who have to vote for the package.

The House and Senate are both proposing to cut more than $1.5 billion in projected growth in health and human services programs.

They also want to cut hundreds of millions of dollars in state agency spending and nearly a billion dollars in aids and credits to local governments.

Legislative leaders were reluctant to go into detail about the cuts. They say the respective committee chairs will release specifics over the next few weeks.

Senate Minority Leader Tom Bakk, DFL-Cook, said the public should be concerned about those details.

"It's very easy to put a budget together on a spreadsheet. They are just lines and numbers. That's easy," he said. "But there's real impacts to real people when you actually get down to the language and all of the line-item appropriations."

Several groups are already expressing concern over what those budget bills will look like. Gary Carlson, with the League of Minnesota Cities, says he expects large cuts in aid to cities and counties on top of what they've seen over the last eight years of budget balancing.

Gov. Mark Dayton's budget plan spares cuts in that area -- which he argues would prevent property tax increases. Instead, Dayton is proposing to increase income taxes on Minnesota's top earners to balance the budget. Carlson said he feels like cities and counties could be in the middle of a political chess match.

"I would guess that it probably will be a very intense power struggle as they try to resolve their differences," he said. "I don't really see an easy way out."

While cities, counties and state employee unions are bracing for big cuts, Republicans are working to spare cuts to K-12 schools and nursing homes. But the cuts in Health and Human Services are so deep that officials representing nursing homes and assisted living facilities fear they will feel them.

"I don't think anyone has even thought about the impact on programs with this kind of budget target when all of the low hanging fruit is long gone," said Patti Cullen with the CareProviders of Minnesota. "There's no easy place to come up with any of the savings without harming some category of folks that really need it."

Rep. Jim Abeler, R-Anoka, said he wants to protect those people. Abeler, who chairs the House Health and Human Services Finance Committee, acknowledges that all of the work he and his committee may do over the next month could be wiped out with a single pen stroke when Dayton likely vetoes the budget bills.

Abeler said everything will be at a standstill until Dayton and GOP legislative leaders agree on a way out of the state's budget mess.

"The big theater is 'What are you doing about revenue?' That discussion has to come to resolution," he said. "When that does, the work I'm doing will make a lot of sense. But at the end of the day, the target will be closer to mine than to his."

Until then, Republicans in both the House and Senate will push forward with their budget ideas and force their members to take difficult votes on items that may never make it into law.