Another day with no deal moves Minn. one step closer to shutdown

With only 21 days before a potential state government shutdown, DFL Gov. Mark Dayton and GOP legislative leaders did not meet Thursday to try to negotiate a budget agreement. Instead, Republicans held another public hearing to air their frustrations with the governor and his proposal to raise income taxes on top earners.

If there's a breakthrough on the budget, it won't likely come during a meeting of the Legislative Commission on Planning and Fiscal Policy. Republican members of that panel have now spent most of two meetings highlighting their disagreements with Gov. Dayton and grilling his budget and revenue commissioners.

Those disagreements included Rep. Doug Wardlow, R-Eagan, taking issue with Management and Budget Commissioner Jim Schowalter for using the word "impasse."

"Commissioner Schowalter, I was a little startled that you declared that in your last statement we are at an impasse. I wasn't aware of that; this is a negotiation going back and forth," Wardlow said. "I hope that was just a slip of the tongue."

"We've gone over this for days and days ... and we are no closer to resolving this budget deficit ..."

In response, Schowalter backed off his characterization of the budget negotiations and apologized for using the word impasse.

"It's just hard to see the progress sometimes," Schowalter said.

Republicans pressed Schowalter for greater detail on Dayton's revised budget proposal that includes $1.8 billion in tax increases and $1.8 billion in spending cuts. They want specifics on how the new tax revenues would be used and what's included in the cuts. Rep. Steve Drazkowski, R-Mazzeppa, argued that budget talks cannot go forward without those answers.

"I don't know how you can negotiate successfully when you've got one side that comes forward with a full picture of their proposal and the governor comes forward seemingly fixated only on raising taxes on a certain minority of Minnesotans," Drazkowski said.

Sen. Julianne Ortman, R-Chanhassen, chair of the Senate tax committee, also took aim at Dayton's tax proposal, which she said isn't going to happen.

"The rhetoric is unbelievable. To say that our budget is somehow draconian, drastic and horrible for Minnesota, but 5 percent, just $1.8 billion makes all the difference between huge thunder clouds and beautiful rainbows and blue skies? I don't think so," Ortman said.

Ortman and other Republicans also argued that a tax increase would hurt the state's fragile economy and make Minnesota less competitive than neighboring states. But Revenue Commissioner Myron Frans defended the tax increase as a necessary step in difficult times.

"The governor's not doing it just because he can or he wants to," Frans said. "He doesn't want to increase taxes. No one wants to increase taxes unless they have to."

DFL members of the commission showed their frustration too. House Minority Leader Paul Thissen said the public discussions were not helping anyone reach a budget agreement or avoid a government shutdown.

"We've gone over this for days and days, and we've spent another hour and 40 minutes here. We are no closer to resolving this budget deficit than we were an hour and 40 minutes ago," Thissen said. "We're no closer to resolving this budget deficit than we came in January 4."

After the meeting, Senate Majority Leader Amy Koch, R-Buffalo, said that she expected to meet privately again soon with Gov. Dayton, but no meetings are currently scheduled.