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Pawlenty ready to cut, says he'll balance budget on own if no compromise

Gov. Tim Pawlenty has started his quest to cut billions of dollars from state government spending if budget negotiations fail in the legislative session's final four days.

While saying he remains open to compromise with Democratic-Farmer-Laborite leaders, the Republican governor said he will use his line-item veto power and other budget-cutting authority to set a new state budget if the Legislature will not work with him "on a reasonable budget solution."

"This year, politics as usual around this place is over," Pawlenty declared in a late Thursday afternoon surprise announcement. "There will be no special session. There will be no government shutdown. And there will be a budget that lives within the means of Minnesota's taxpayers and the revenues available to the state of Minnesota."

Pawlenty said he will trim the budget two ways:

* Line-item veto items out of budget bills lawmakers already have sent to him. That authority is limited to just some budget items.

* After the partial vetoes, he will unilaterally reduce spending to match revenues, a procedure designed to balance a budget in changing economic times.

Bills lawmakers passed would spend $34 billion in the next two years, but just $31 billion in revenue is expected without new revenues.

House Speaker Margaret Anderson Kelliher, DFL-Minneapolis, called Pawlenty a bully for his actions. She said Pawlenty's plan would cut 10 times more money from the budget than has any other governor. And, she added, Pawlenty will have used unallotment three of the five times it was used in state history.

Senate Majority Leader Larry Pogemiller, DFL-Minneapolis, said he expects Pawlenty to change his tune. "I assume as the governor of the state he will calm down and get his wits about himself."

In a tense evening meeting, Kelliher told Commissioner Tom Hanson of Minnesota Management and Budget that Minnesotans deserve to know what Pawlenty will cut. Hanson said the exact cuts still are being considered and "in the days to come we can share more detail."

Kelliher responded: "I think it would be good to have details within the next 24 hours, otherwise it would appear ... the governor is going it alone."

Hanson and Pawlenty criticized the Legislature for passing a budget with a $3 billion funding shortage.

City and union leaders were upset with prospects of losing money.

"The real losers in this failure to compromise are property tax payers and Minnesota families who depend on critical services like police and fire protection," Wadena Mayor Wayne Wolden said for the Coalition of Greater Minnesota Cities. "If the governor takes critical local government aid, Minnesotans need to brace for the largest property tax increases in state history - and devastating cuts in local police, fire, libraries and community services."

Pawlenty refused to tell reporters precisely what he will cut, but did say local aid payments will be cut or delayed. The governor promised to give local governments advance notice before the cuts become effective July 1.

Eliot Seide of the American Federation of State, County and Municipal Employees said Pawlenty thinks "he can suspend democracy."

"It is the height of arrogance to act in this dictatorial fashion," Seide said.

Pawlenty's first cuts came late Thursday in a health and human services funding bill as he cut more than $381 million. That is from $10.7 billion in state funds.

The money was taken from General Assistance Medical Care grants. Pawlenty said more cuts will come.

It was not immediately clear how many Minnesotans could lose health care payments with his line-item veto. However, Pawlenty said in a veto letter, those who lose aid can sign up for state-subsidized MinnesotaCare insurance.

Pawlenty also erased six areas of spending from an economic development bill, including jobs programs for American Indians and Southeast Asians. He also axed money intended for programs to attract films and television programs, a construction workers memorial, public radio and a legislative commission that he said already has enough money.

Pawlenty said he will sign every budget bill legislators passed, although he will cut what he can with his line-item veto power.

On a public works bill, Pawlenty promises "numerous line-item vetoes," but he would not be specific. Pawlenty spoke highly of flood prevention measures included in the bill, indicating that money may be safe from cuts.

The biggest problem has been a disagreement between Pawlenty and Democrats over tax increases. The House voted for a $1.5 billion tax increase, upping a variety of taxes, while senators focused on raising income taxes

$2.2 billion.

Pawlenty vetoed a $1 billion tax increase legislators passed. That and delayed payments to school districts represent most of the $3 billion difference between Pawlenty and the DFL.