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June 22, 2005
Uh-oh

Just when you thought things were as screwed up as they possibly could be at the Capitol they got worse. That state Supreme Court decision from a couple weeks ago involving taxes Hutchinson Technology said it shouldn't have to pay will make Minnesota's budget problem significantly worse over the nest few years. MPR's Michael Khoo has some background:

Revenue commissioner Dan Salomone says that as a first response Minnesota should change its tax laws to stop the drain on future revenues.

"The Legislature and the governor need to focus on the prospective problem, change the law so we basically stop the bleeding, revenue loss," he said.

Salomone said such an amendment could wipe out a third of the ruling's fiscal impact. The remainder -- as much as $200 million -- would still be owed to companies as rebates on previous tax bills.

Lawmakers from both parties and both the House and Senate suggested that that liability can be spread out over several years and shouldn't necessarily be part of the current budget discussion. They say that, instead, they'll stick to the official state budget forecast prepared last February, well before the court ruled in the Hutchinson case. A new forecast that would take into account the court ruling isn't due until November.

OK, maybe all the details aren't known, but isn't it just that kind of avoidance that has led to these recurring shortfalls?

The Star Tribune has more on the story:

Pawlenty and House Speaker Steve Sviggum discounted the severity of the problem, arguing that technically it's a problem for the 2006 Legislature and will be factored into the November 2005 budget forecast. "It's significant, but within the context of a $30 billion dollar [two-year] budget it's manageable," said Brian McClung, Pawlenty's spokesman.

"I think it's a fairly big hit for us," said Finance Commissioner Peggy Ingison. "It's not going to make it any easier to resolve the issues" in front of the current Legislature, which has been in special session for almost a month.

DFLers expressed more alarm for the problem, which they blamed on Republican inaction in response to DFL warnings.

"This exacerbates the problem further," said Johnson, the DFL majority leader from Willmar, adding that it could be argued that it turns the overall budget deficit for 2006-07 to nearly three-quarters of a billion dollars. Johnson and other DFLers contend that the decision vindicates DFLers in their long-standing efforts, led by Taxes Committee Chairman Larry Pogemiller, to toughen and clarify state laws to prevent corporations from sheltering income from foreign operations.

And as the budget problem appeared to get worse, there was more pressure from rank and file lawmakers on their leaders to get a deal done. The Pioneer Press had that story:

With Minnesota legislative negotiations at a near standstill and government officials planning for shutdown, there was little rank-and-file lawmakers could do to force the messy lawmaking process along.

So, they did little. On Tuesday, House Republicans held a "vigil" outside Senate Democratic leaders' state Capitol offices to pressure them to get the job done.

One by one, the Republicans sat in a cozy leather office chair in the hallway outside Senate Majority Leader Dean Johnson's office. GOPers had filled out a schedule that would have a person in that chair every hour of the day including overnight for at least 24 hours.

"We are here to represent the people of Minnesota, and the people of Minnesota want us to finish," said Rep. Char Samuelson, R-New Brighton, as she began her three-hour shift Tuesday afternoon. Like others, she sat prepared to chat with any Democratic-Farmer-Laborite who happened by, but she also brought a sheaf of work to pass the time. She said Republicans might continue their "work-in" until a budget deal is done.

Well, the governor is in Washington Wednesday, so it might be a long night for those folks. There are no meetings scheduled at the Capitol, although Thursday there's a court hearing to decide what's an essential state service and what isn't. That's about all there is to look forward to.

And finally, who's to blame for the shutdown? According to a piece on the Star Tribune editorial page by first term Republican Rep. Tom Emmer, apparently it's the media:

Every night, news anchors offered up talk of "government shutdown" and a so-called do-nothing Legislature. And every day, another constituent sends another nasty e-mail about how stupid and worthless all legislators are and how we should all be thrown out of office for our idiocy. Repetition works.

It may not be the truth, but every day the media recklessly sell their woeful product, we lose more trust for our elected officials and the institutions they serve.

Remember, peace and productivity do not sell newspapers or garner ratings. Keep the public in a constant state of fear and loathing about our government, and the media moguls enjoy the windfall. We are enslaved to their redundant fault-finding criticism.

We are daily at risk of buying the gloom and doom that they are selling.

Don't be fooled.

My work as a state representative was for the most part done when the regular session ended. If you want to see what I did with my colleagues in the House, go to the House website and look it up. We got a ton of work done! I am proud of what we accomplished in the House.

As you consume the half-truths put forth by our media, please bear in mind that we are public servants and, contrary to what you hear on the news, most of us work our tails off. Our families make significant sacrifices to support us.

Why can't they just report some GOOD news for a change?


Posted by Mike Mulcahy at 6:34 AM