Capitol View: August 10, 2010 Archive

Pawlenty blasts federal money he counted on in January

Posted at 3:20 PM on August 10, 2010 by Tom Scheck (4 Comments)
Filed under: Tim Pawlenty, U.S. House

Gov. Pawlenty today issued a news release criticizing Congress for passing legislation that would provide financial assistance to states to pay teachers.

"The federal government should not deficit spend to bail out states and special interest groups. Minnesota balanced its budget without raising taxes and without relying on more federal money. The federal government's reckless spending spree must come to an end. "

Pawlenty, who appears to be preparing for a 2012 White House run, isn't telling the whole story when it comes to Minnesota's budget picture.

In January, Pawlenty proposed a budget that relied on $400 million in FMAP money from the federal government-- the same funds in the bill the House passed today. Pawlenty and lawmakers changed course only after they realized Congress wouldn't provide the money by the time the legislative session ended. They agreed to put the funds, if they became available, into reserve.

The Congressional action means the state now has a cash cushion and may not have to borrow money to pay bills as State Finance officials predicted in July.

Pawlenty also fails to mention that he relied heavily on federal money to balance the state's books in 2009.

It should also be noted that the budget adopted by Pawlenty and the DFL controlled Legislature delayed $1.2 billion in payments to schools that will eventually have to be paid back.

The reliance on federal funds, the school funding shift and other one-time funds mean Minnesota's budget problems will get worse when Pawlenty leaves office. The next governor is expected to inherit a $5.8 billion projected budget deficit for the next two year budget cycle. Factor in inflation and the shortfall amounts to $6.9 billion

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