JULY 11, 2009
Pawlenty Garners Attention With Budget Move
By AMY MERRICK
WSJ
With a handful of states struggling to finish their budgets, Minnesota Gov. Tim Pawlenty was adamant about closing his state's $2.7 billion deficit without raising taxes. After vetoing the Democratic-led legislature's bill that called for $1 billion in tax increases, the Republican governor took matters into his own hands. Instead of calling a special legislative session, he hacked at the budget himself, employing an unusual and rarely used "unallotment" law to cut Minnesota's two-year general-fund spending to $31 billion. State agencies began detailing their cuts this week.
The move isn't sitting well with some of Mr. Pawlenty's constituents. Religious leaders organized a protest, a lobbying association for cities considered suing him, and the state Democratic-Farmer-Labor party criticized him for making an end-run around lawmakers. But blocking tax increases is a signature political move for Mr. Pawlenty, who is the subject of growing speculation about a possible presidential run in 2012. He said last month that he won't run for a third term next year. This week, he's been calling for Republicans to restrain federal and state spending. In an interview, Mr. Pawlenty called spending control "the central premise of the revitalization of the Republican party." As for the presidency, "I'm not ruling anything in or out, but I don't know what the future holds for me," he said.
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Mr. Pawlenty erased much of the deficit by putting off bills, shifting $1.77 billion in payments to K-12 schools. Colleges and universities will lose $100 million in state funds over the next two years, while cities and counties will lose $300 million. The League of Minnesota Cities considered bringing a lawsuit against Mr. Pawlenty. But some league directors feared that even if the group won a court battle and reversed the cuts, cities could end up losing even more money the following year. The board decided not to sue. The league expects cities to cut spending and increase property taxes to compensate for the lost aid, said Gary Carlson, the group's executive director.
Lawmakers in the DFL-controlled legislature condemned Mr. Pawlenty's unilateral move. "The governor gave us two options: We could solve the budget deficit his way, or he would solve the budget deficit his way," said Margaret Anderson Kelliher, the DFL speaker of the state House. Rep. Anderson Kelliher says the legislature will review the governor's unallotments when it reconvenes Feb. 4. But lawmakers could be constrained by the huge deficit, perhaps as much as $7 billion, already predicted for the 2012-2013 biennium. Mr. Pawlenty said a special legislative session would have created gridlock and extra costs for taxpayers.
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Religious groups protested Mr. Pawlenty's budget cuts June 30. Dressed in black and carrying flowers, hundreds of congregants knelt on the steps of the state capitol and left letters urging the governor to reverse his decision. The Rev. Grant Abbott, executive director of the Saint Paul Area Council of Churches, said he expected more families who have lost access to health care to show up at the homeless shelters operated by religious organizations. This month, the group expanded from offering 40 beds and six cribs each night to 60 beds and nine cribs. Mr. Pawlenty said he would consider a compromise on the health-care program, which was set to expire after the legislature reconvenes. He acknowledged his budget cuts would make some citizens' lives more difficult, but said, "I think it is consistent with what society is going through generally."
http://online.wsj.com/article/SB124727136151226031.html (subscription)
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