Pawlenty proposes budget up 9.3 percent; $1.4B more for schools

Gov. Pawlenty boiled down his mammoth budget proposal into a simple theme: government should stop paying for good intentions and start paying for better performance.

To that end, Pawlenty is linking new money to performance goals in education funding and other areas of state government. He says taxpayers deserve fiscal discipline and better results.

"To have an attitude of simply saying, 'we're going to take the status quo and add inflation' and call it 'good' is not sufficient," Pawlenty said. "We're going to be very aggressive about reform and change and emphasis on performance and modernization during this upcoming session. We think that's very, very important to position our state to be competitive and to also continue to offer and value and quality of services to our citizens."

More than half of the governor's new spending would go toward K-12 schools and colleges and universities. His other investment targets, using a projected $2.2 billion budget surplus, include alternative fuels programs, health care reforms, roads and veterans programs.

There's also $227 million in tax relief for property and income taxpayers, including tax breaks for military personnel and their families. Pawlenty says the overall spending increase of more than 9 percent is more than sufficient. "Anybody who's complaining about not getting 22 percent when they're getting 7, 8, 9, 10, 12 percent increases, I suggest to you should pipe down and be satisfied because inflation is about 2 percent, 3 percent right now," he said.

The governor's budget proposal is a starting point for funding discussions that will last four months. Unlike his first term, Pawlenty is now trying to sell his spending plan to a Legislature controlled by Democrats in both chambers. "We were pleased that the governor spoke of many of the priorities that we've heard Minnesotans speaking about. However we were disappointed," said DFL House Speaker Margaret Kelliher of Minneapolis.

DFL leaders in the House and Senate have also put a priority this session on education, health care and tax relief. But Kelliher says the governor hasn't gone far enough.

"There's no plan to implement an all-day, every-day kindergarten plan in this state," she said. "There's no plan in this budget for covering all Minnesota children with health care. Nor is there really leadership on the transportation issue. And we are disappointed by those things today and suspect that the Legislature will spend a fair amount of time on those issues in the coming weeks ahead, as well as looking at the governor's budget."

DFL leaders are also taking issue with the governor's budget assumptions. They claim the absence of an inflation factor makes the budget surplus appear about twice as big as it really is.

Pawlenty insists inflation is reflected in his budget, and that there's no need for tax increases. Democrats haven't ruled out raising taxes.

The governor is also getting criticism from some of his fellow Republicans. House Minority Leader Marty Seifert, R-Marshall, compared the budget proposal to a blind date that fell short of expectations. He was particularly disappointed with Pawlenty's approach to tax relief.

"I think there needs to be some permanency in the tax relief," Seifert said. "The property tax reductions could be much higher. You could easily have over $1 billion in tax relief and take care of the perceived needs or real in K-12 and some of the critical areas."

Several House and Senate committees will begin dissecting the governor's budget proposal later this week. DFL leaders are waiting for next month's economic forecast before finalizing their spending proposals.

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