Budget cut bill vetoed; Dayton calls bill 'extreme rashness'
ST. PAUL -- Minnesota's new Democratic governor called a Republican-written budget-cutting plan unconstitutional when he vetoed it Thursday, and neither he nor legislative leaders showed any sign of compromise as they work to plug a $6.2 billion budget deficit.
Gov. Mark Dayton, sworn in on Jan. 3, rejected the bill that would have cut $824 million from the next two-year state budget and $100 million from the budget that ends June 30. Republicans said it was the first step in fixing the deficit.
"Extreme rashness" was how Dayton described the bill.
Dayton wrote to legislative leaders that the GOP plan to order his administration to trim $100 million in the coming months "would abdicate your responsibility to make those difficult spending choices." Turning that job over to the administration violates the State Constitution, the governor said.
He also contended that there is not $100 million left that can be cut through June.
Dayton said he vetoed the bill for other reasons, too, including a Revenue Department estimate that the bill would force property taxes to rise $428 million in the next two years, in a large part because it would freeze state payments to cities and counties.
The governor's action came hours after senators approved the measure 37-28. The House favored the bill 68-61 a day earlier.
Dayton criticized Republicans in charge of the Legislature for only working on part of the state's $6.2 billion budget problem. He wanted lawmakers to offer a complete budget solution, like he promises to release Tuesday.
The governor was not involved in writing the bill, nor in House negotiations, despite legislative leaders' promise to bring his administration into the process before sending him the bill.
Dayton said he was clear in telling legislative leaders, during regular meetings, that he could not accept their bill. But House Majority Leader Matt Dean, R-Dellwood, said Dayton left Republicans confused about his position.
"This shouldn't be that difficult," Dean said, because major budget cuts will be needed to balance the budget before lawmakers end their session on May 23.
Deputy Senate Majority Leader Geoff Michel, R-Edina, said problems are not over.
"We are going to have a clash," he predicted, with Dayton wanting to raise taxes and spending while Republicans want to cut spending.
Senate Finance Chairwoman Claire Robling, R-Jordan, said that cities and counties need to be fiscally responsible and make more cuts to balance their budgets.
"We have to question whether cities and counties should be exempt in these tight budget times," she said.
About half of the cut in the next budget, which begins July 1, would come from state payments cities and counties expected.
Dayton said he accepted a Robling suggestion for the current budget. On Thursday he ordered his department heads to begin an immediate review of money that can be saved in the coming months.
However, the governor said that there is no way $100 million can be saved, as the GOP bill required.
Dayton and GOP leaders agreed that they will continue to try to work together. Dayton said two bills debated on Thursday will show whether he and legislators can work together.
The governor made suggestions that he said could lead to compromises on bills to provide an easier way for professionals to become teachers and speed the environmental permitting process.
Senate debate Thursday pitted Democrats against Republicans.
"What we are doing today is poking the governor in the eye with a stick," Senate Minority Leader Tom Bakk, DFL-Cook, said shortly before Republican senators voted to pass the bill on to Dayton.
Robling compared the bill to her hobby, gardening, in which she finds it easier to pull weeds over a period of time instead of all at once. It is a lot easier "if I do it in steps," she said.
Cuts in the next budget would be reductions from what currently is planned to be spent.
While most of the bill would cut spending, one provision would have removed a limit on how much landowners can receive from a state program designed to encourage sustainable forests. The bill would have eliminated the $100,000 cap on those payments.
Of five large forest owners that benefit from eliminating the cap, three (Blandin Paper Co., Potlatch Corp. and Meriwether Land and Timber) sued the state over the issue. They claim they lost $8 million to the payment limit.
Senate Tax Chairwoman Julianne Ortman, R-Chanhassen, said the lawsuit led to the decision to lift the payment limit.
Bakk said that raising the payments would cost the state $11 million a year. The decision came with no public testimony during a 32-minute conference committee meeting this week.
Sen. Roger Reinert, DFL-Duluth, said he is concerned that requiring $100 million in cuts over the next few months could eliminate or reduce spending on some veterans and military programs, such as help to pay tuitions, veterans' home repairs and re-enlistment incentives.