Posted: 1/8/03

Legislative session may be painful

T.W. Budig
ECM Capitol Reporter

The 2003 legislative session promises to be painful. Gone are the days of budget surpluses and storybook dilemmas of what to do with the avalanches of revenue.

With a state budget ravaged by rising healthcare costs, the burst of the stock market bubble ó irrational exuberance, some argue ó lawmakers must deal with a stunning reversal of fortunes that will affect the core functions of state government.

Awaiting lawmakers as the legislative session opens this week are two budget deficits: a lingering $356 million deficit for 2002-03 and a yawning $4.6 billion projected deficit for 2004-05.

And as Gov. Tim Pawlenty has acknowledged, the budget picture could get worse.

Nationally, Christmas retail sales were below expectations. War with Iraq remains a possibility and the uncertainty of geopolitics could serve to retard economic growth.

ìWord needs to go out clearly and simply; the world has changed,î Pawlenty said. ìAnd state government does not have the option to remain the same.î

In a central variable of the budget debate, Pawlenty has pledged to address the state budget crisis without raising taxes.

No retreat on taxes

He, along with political Republican rival Brian Sullivan, signed a no new tax pledge last summer when it was generally assumed the 2004-05 projected budget deficit would be about half its current size.

But Pawlenty has not retreated from the no new taxes stance.

He portrays state spending as out of control, essentially increasing 100 percent in a decade while the population grew only about 12 percent and inflation idled around three percent.

(FY 2002-03 state general fund spending is estimated at $27 billion).

ìAnd we have a crisis in Minnesota in terms of the demand and appetite for government services and our capacity to reasonably provide them,î Pawlenty said.

Pawlenty speaks of the need to restructure state government. In that vein he has appointed Lt. Gov. Carol Molnau transportation commissioner.

He joked it was about time the lieutenant governor did some work.

Working on the Pawlenty budget ó a document due Feb. 18 and one for which the Legislature is collectively holding its breath ó is finance commissioner-designate Dan McElroy, a former House member known for his brilliance.

Budget plan?

Exactly what budget will be crafted remains to be seen.

Certainly, changes will be proposed for things elemental.

Pawlenty lists public safety his top priority; education his second.

Still, education funding is ìon the table,î though the governor says heís trying to spare the classroom.

ìThe debate cannot, and I repeat, the debate cannot center around the commitment to education only around how much money weíre spending,î Pawlenty said.

In what city officials might relish like a bucket of cold water, Pawlenty talks of reviewing local government aid ó determining which cities truly require state assistance and those cities with lesser claims.

ìThatís a worthy goal and should be preserved and maintained as a goal,î he said of assisting truly needy cities.

But it opens the question of what constitutes need.

Other voices

What will legislative leaders have to say about the upcoming session?

House Speaker Steve Sviggum, R-Kenyon, said recently everything in state government is on ìthin ice.î One exception is public safety, he said.

How can the budget deficit be solved?

ìI will tell you very, very honestly, Iím not exactly sure,î Sviggum said.

Theyíll have to look at the tobacco endowment, the highway helper program, the state planning agency. As for Minnesota Planning, itís ìprobably not going to be there,î Sviggum said of the aftermath of budget cuts.

Sen. Majority Leader John Hottinger, DFL-Mankato, said he hoped the legislature dealt more effectively with the deficit than it did with the budget surplus.

ìMuch of policy thatís going to be handled this session is going to be driven by the budget deficit,î he said.

ìNo Minnesotan should bear extra burden because of budget solution. Weíre going to be watching that very carefully,î Hottinger said.

Sviggum and Hottinger will be leading legislative bodies that have changed both politically and in terms of experience.

While Republicans strengthened their hold on the House ó 11 seats gained ó about a third of the 134-member body are freshmen lawmakers.

Republicans hold a 30-seat majority in the House.

In the 67-member Senate, DFLers hold a four seat majority with the Legislatureís sole Independence Party lawmaker, Sen. Sheila Kiscaden, IP-Rochester, electing to caucus with Republicans.

About a third of the Senate is composed of freshmen lawmakers.

Sen. Dick Day, R-Owatonna, is Senate minority leader. Rep. Matt Entenza, DFL-St. Paul, is House minority leader.

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