Thursday's state budget news had been anticipated for quite some time, given the poor state of the economy nationally. But actually hearing the numbers is quite sobering.
State budget officials pronounced that the state faces a $5.27 billion budget deficit -- with $426 million coming in the current budget year that ends June 30 and $4.85 billion facing lawmakers when they prepare the state's next two-year budget that takes effect July 1.
A two-step process is dictated -- one which immediately addresses the short-term budget deficit and a longer-term vision for the state that restructures and reprioritizes what services state government should provide.
Gov. Tim Pawlenty already took action Thursday to grapple with the short-term deficit by ordering state agencies to prepare plans for a 10 percent cut in their remaining fiscal year budgets, exempting some public safety and corrections programs. Democrat leaders, who control the Legislature, need also to step forward with ideas to find consensus in how to take care of the short-term problem, clearing the decks for a full discussion of the looming $4.85 billion shortfall for the next biennium when it convene in January.
Gov. Pawlenty on Thursday reiterated his "no new taxes" pledge, but the time has come to abandon that mantra. It worked before, because state spending was slashed and one-time funding such as the billion-dollar tobacco settlement was used to balance the budget. Even the state's rainy day fund was dipped into last year, so many of the funding options used before are not available.
ADVERTISEMENT
Options that must be put on the table this session include making state income taxes fairer but reinstating tax brackets that progressively have the state's wealthiest pay the same proportion as middle-income Minnesotans -- about 12 percent rather than the 9.5 percent the rich now pay. The extension of sales taxes, although not a progressive move, should also be at the table. Adding food and clothing to the sales tax will help stabilize state revenues. Another tool should be considered, one that was last used during the early 1980s when seven special sessions were held to balance the budget -- adding a 10 percent state income tax surcharge that has a definite date in which it blinks off.
Aside from raising revenues, now is the time to also restructure state government to fit the priorities of the 21st century, something Gov. Pawlenty called "a quantum change."
The state budget should start at zero, and each government program and function analyzed for its need and justification in today's climate. We are sure that a substantial number of state services are outdated and unneeded or duplicate state services elsewhere. Still, there won't be enough savings to make up a nearly $5 billion deficit.
Perhaps most importantly, however, is that the governor and legislators set aside partisan politics and work together to make decisions that preserve the quality of life that Minnesotans expect, and not lower it.
BEMIDJI PIONEER
