Supremes loom large in Legislature’s second half

If you watched the DFL-controlled Minnesota Legislature pass and Republican Gov. Tim Pawlenty sign into law a mini-budget bill before taking a halftime break last week, you might think lawmakers in St. Paul are marching efficiently to close up a $1 billion state budget deficit so they can get out on the campaign trail and begin Election 2010 well before the May 17 adjornment date. But what if, suddenly, that state budget deficit ballooned to more than $3.5 billion? That’s one possible scenario, if the Minnesota Supreme Court decides Pawlenty’s budget unallotment move last year was unconstitutional. Justices on March 15 heard the case against Pawlenty’s unallotment move, which unilaterally cut $2.7 billion in state spending last year after the Legislature went home to balance the budget, after he vetoed the tax increase the DFL Legislature passed to pay for the spending. Continue Reading

Is this pork?

There’s $45 million for the Central Corridor light rail project. And $300,000 for juvenile crime prevention on the north side of Minneapolis. And $200,000 for afterschool programs for Somali youth in the Cedar-Riverside neighborhood.They are among the $300 million in congressional earmarks being sought by Minnesota’s Democratic members of Congress in the House of Representatives.No House Republicans have put in for earmarks this year, calling them pork and wasteful spending. So if you’re in one of their districts, you won’t be getting your federal tax dollars back, unless a Democratic U.S. Senator helps you out.Since the Minnesota legislature is taking a little down time, I thought it was a good time to show you how to see the earmark requests made on Minnesota’s behalf this year. As U.S. Sen. Amy Klobuchar, D-Minn., says in her earmark page, these requests were all submitted at the request of Minnesota constituents.On Congressman Keith Ellison’s earmarks page, each request includes an explanation for the item entitled “Legitimate use of taxpayer funds.”Congresswoman Betty McCollum’s earmarks page is organized by Congressional subcommittee.Some of the requests would bring federal tax dollars back to the members’ districts. Continue Reading

Minnesota close to needing payday loans

The State of Minnesota is starting to look more and more like a bad credit risk. If you need proof, take a look at HF 3741, Gov. Tim Pawlenty’s proposal to deal with a looming cash flow problem that could keep the state from paying its bills.Introduced last week, the bill allows the state to put off paying the University of Minnesota from the 21st to the 25th of every month, even as it requires large state sales tax generators to pay more of their estimated taxes earlier in the month and forces counties to pay state property taxes to the state a month earlier than current law mandates.These things are necessary, State Budget Director Jim Schowalter said, because the state currently has no cash reserves and payments could bring the state down to $0 in its general fund balance.That’s a situation people in business refer to as being “cash-poor,” but I’ve also heard it called being “dead-ass broke” around my neighborhood.The bill’s author is Rep. Loren Solberg, DFL-Grand Rapids, head of the House Ways and Means Committee. There is no Senate companion as yet, but the bill has been fast-tracked through to the House Taxes Committee.Solberg said he doesn’t view the bill as a permanent solution to the state’s cash flow problems. But the other option would be for the state to take out short-term loans, which could negatively affect the state’s credit rating, he said. Continue Reading

DFL budget cuts hurt working poor, elderly, students, renters, disabled

As the DFLers in charge of the Minnesota Legislature return home for the Passover/Easter break, they may have some explaining to do to constituents about why the mini-budget bill they just sent to Gov. Tim Pawlenty hits the people they say they’re there to protect so hard. HF 1671 passed 76-55 in the Minnesota House of Representatives and 44-23 in the Minnesota Senate on Monday, and was presented to Pawlenty for his signature. The bill trims $312 million from a $1 billion deficit remaining in the state’s budget for the current cycle. Thanks to Minnesota Budget Bites, we have a better idea of how they do it, and it’s not a pretty picture for disadvantaged Minnesotans. For example, the bill makes the following cuts to traditionally DFL constituencies: * College students will no longer be eligible for financial aid if they go beyond eight semesters of study to earn their bachelor’s degree. Continue Reading

Shortening the session to lengthen election campaigns?

The Easter/Passover break state lawmakers began Tuesday usually signals the halfway point of the Minnesota Legislature’s session. But this year, there are signs that lawmakers could be calling it quits early so they can get started on their 2010 election campaigns. Consider: The Legislature has already passed and Gov. Tim Pawlenty signed (with line-item vetoes) a bonding bill, the traditional reason for having a session on even-numbered years. Of course, there’s a $1 billion deficit for the current state budget cycle to deal with, but lawmakers on Monday passed a budget bill that Pawlenty said he’ll sign that eliminates about one-third of that deficit (as long as you squint and don’t count the federal dollars they’re banking on that haven’t been approved yet or the one-time money and shifts they chastised Pawlenty for using in past years. After passing the General Assistance Medical Care fix their DFL constituencies wanted and seeing Pawlenty veto it, DFL lawmakers found common ground with Pawlenty to keep the program going in a stripped-down fashion for another year or so. Continue Reading

DFLers embrace Pawlenty business tax breaks to reward their districts

In one month, DFL legislative leaders have gone from hating Gov. Tim Pawlenty’s signature economic development tax break plan to loving it so much they want to extend it in certain cases.So why have Democrats put their loathing for Pawlenty’s JOBZ program aside this session? Because the jobs bill they plan to pass on Monday calls for extending or modifying it to help land or keep jobs in Duluth and St. Paul, two DFL strongholds.SF 2568, from Sen. Tom Bakk, DFL-Cook, and HF 2695 from Rep. Ann Lenczewski, DFL-Bloomington, hands out tax boons to different groups and cities in hopes ot creating some jobs.The most widely discussed parts of the bill are an angel investor tax credit for people or groups that bankroll new business start-ups, a tax credit for small businesses that hire new employees and a tax credit for restoring historic buildings.Some of the ideas line up with Pawlenty’s tax proposal, though he has criticized it for not going far enough in cutting business taxes.Humorously, for those who have been watching DFLers try year-in and year-out to yank the rug out from under Pawlenty’s JOBZ program, this year they’ve done an about-face and decided to use it to help land a wind turbine manufacturer in Duluth and to make the St. Paul Ford plant a tax-free zone to keep those jobs from leaving.Some other winners, hand-picked by Bakk and Lenczewski for tax benefits in the bill:* The Mall of America expansion in Bloomington would get state authorization to use local tax breaks to do a phased expansion.* Oakdale, East Grand Forks, North Mankato and Cohasset get expanded authority to offer local tax breaks for job creation.* Urban redevelopers who could access local tax breaks for “compact development districts.”* Duluth would get to use some taconite tax set aside for a biomass energy plant in 2008 to be used instead for a value-added wood product facility.Watch the Senate Taxes Committee discussion of the bill here.  Continue Reading

Color me surprised – bending the rules for judicial election reform

A proposed constitutional amendment to reform judicial elections is dead, after Rep. Joe Mullery, DFL-Minneapolis, kept it from getting a committee hearing before a deadline expired. But now it seems the rules that DFL leaders use to kill some lawmakers’ bills can be bent when it suits their purposes. Color me surprised.Mullery, who heads the House Civil Justice Committee, didn’t give HF 224 from Rep. Steve Simon, DFL-St. Louis Park, a hearing before the second committee deadline last Friday by which bills had to receive committee approval in both the House and Senate.Now, House Speaker Margaret Anderson Kelliher, DFL-Minneapolis, is pressing Mullery to give the bill a hearing, saying the deadline rules could be bent for the bill, according to Minnesota Public Radio’s Tom Scheck.A Senate version of the bill from Sen. Ann Rest, DFL-New Hope, is moving through the Senate and both Senate Majority Leader Larry Pogmiller, DFL-Minneapolis, and Kelliher are said to want the bill to pass and the amendment to be on the ballot this fall.A majority of voters would have to approve the measure, which would replace the current system of competitive judicial elections with a system of appointment and retention elections.The proposal comes from a group led by former Gov. Al Quie that is concerned about growing partisanship in judicial elections.Mullery doesn’t favor the reform measure, but there may be enough votes to pass the bill in his committee, Scheck writes.  Continue Reading

Help for Web-based government watchdogs moving forward

Ever try to get public records from a state government Web site? There’s no consistency about what is available or how it is presented, from one state agency to another or between the different branches of state government.That could change, if HF 2557 from Rep. Phyllis Kahn, DFL-Minneapolis, becomes law.Kahn, who heads the House State Government Finance Division, proposes creating a state Webmaster position, which would be responsible for coordination and development of all state Web sites.Along with the new position would come the requirement for developing and maintaining standards of transparency, disclosure and access to public data online with which all state agencies would have to comply.The bill was up for a hearing in Kahn’s committee Wednesday and has already received approval in the House State and Local Government Operations Reform, Technology and Elections Committee.A Senate companion bill, SF 2188, from Sen. Don Betzold, DFL-Fridley, has already passed a couple committee hurdles and looks to be headed for a Senate floor vote. Continue Reading

Obamacare to the rescue on GAMC, maybe

Last year, it was the federal stimulus bill that helped state lawmakers plug a $4.6 billion deficit for the 2010-2011 budget cycle, by increasing funding for education, health and welfare programs.
This year, DFL lawmakers and Gov. Tim Pawlenty are both counting on nearly $400 million in increased Medicaid funding to help plug an additional $1 billion hole in the state budget that has since opened up. Even with that, DFLers budget plans still left a big hole in the Health and Human Services budget that was going to have to be filled with painful cuts. Until Congress finally passed its health care reform bill, that is. As a result of that bill, Minnesota could receive up to $330 million in increased federal subsidies for its low- and moderate-income public health insurance programs, General Assistance Medical Care and MinnesotaCare, according to Rep. Tom Huntley, DFL-Duluth. Huntley, who heads the House Health Care and Human Services Finance Division, told Minnesota Public Radio that the additional money will reduce the overall cuts that need to be made to the state’s Health and Human Services budget, from about $323 million to about $100 million. Continue Reading

What are tails?

As the Minnesota House of Representatives and Minnesota Senate take up budget bills that would trim about $312-314 million of the $1 billion deficit remaining in this current budget cycle, let’s look at the effect their bills, and what Gov. Tim Pawlenty had proposed in his budget, would have in future years.Both HF 1671 and SF 3223 deal with just about every part of state government except the two things that cost the most — K-12 education and Health and Human Services spending.And on a superficial level, the House, Senate and Pawlenty’s requests have some similarities.The House bill cuts $312 million in spending through June of 2011, when the next budget cycle begins. The Senate bill would cut $314 million from overall, while Pawlenty’s budget proposal cuts a bit more — about $464 million — largely through deeper cuts in state aid to cities and counties than the DFL-controlled Legislature is willing to allow.Where the lines start to diverge sharply, however, is in the “tails” of the budget bills: the proposed effect on future budgets that actions taken today would have.Pawlenty’s budget proposal envisions that his $464 million in proposed cuts, largely to the current higher education, economic development, state government and local government aid areas of the budget, would extend and expand through the 2012-2013 budget cycle, trimming almost $1.5 billion more from the state’s next budget.The House of Representatives, on the other hand, envisions that its $312 million in proposed cuts in this budget, largely to local government aid, higher education, ethanol subsidies, public safety and state government, would translate into $466 million more in cuts in the next two years.And the Senate bill’s $314 million in proposed cuts mainly to local government aid, higher education, public safety, state government and economic development would mean those areas would be cut $494 million more in the 2012-2013 budget.That’s part of the reason why the legal arguments about Pawlenty’s unallotment actions last year are intensifying. Pawlenty’s budget proposal assumes the Legislature ratifies his unallotment decisions, locking in more cuts in the following years. But DFL lawmakers reject Pawlenty’s unalottment authority and won’t accept that those cuts are set in stone.With the state’s February economic forecast predicting a state budget deficit of $5.7 billion for the 2012-2013 budget cycle — up $363 million from predictions last November despite improvements to the economy — it’s clear something’s got to give soon, either on taxes or on spending, or on both.It’s also clear that this year’s Legislature has shown little sign of trying to answer that bigger question so far. Continue Reading