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Not Everyone is Happy with Budget Deal
By Martin Kaste
May 12, 1999
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Rank-and-file legislators spent the day digesting the budget deal struck late yesterday by top legislative leaders and Governor Ventura. It sets aside roughly $1.6 billion for permanent tax cuts and set the spending levels for areas like education and transportation. Governor Ventura says the deal has something for everybody, but it also seems to have something for everybody to hate.

THE BUDGET DEAL SETS ASIDE $1.6 billion for permanent tax cuts over the next two years, but the only kind of tax cuts it specifies is a half a percentage point off all three income-tax rates. That leaves the House and Senate Tax Conference Committee with more than $0.5 billion dollars to squabble over, and they spent most of the day doing exactly that. Senate tax chairman Doug Johnson says he wants to make sure as much of that money is targeted at the middle and lower classes as possible.
Johnson: You know, I'm not a liberal democrat, but I believe in fairness, and I think the middle class is getting screwed, and I don't like it.
Johnson made his displeasure apparent all day but he stopped short of pointing fingers at the man who negotiated the deal, Senate Majority Leader Roger Moe.
Johnson: The agreement hurt.
MPR: Did Roger Moe give in too much?
Johnson: I'm…I'm gonna leave (laughter).
Johnson and the Senate DFLers say they want to put the unallotted half-billion dollars into a reduction in license tab fees, residential property tax relief and other tax relief they believe helps lower-income people the most. Their Republican counterparts in the House say they'll probably go along with some kind of property-tax relief, although with more of an emphasis on business property taxes. But instead of a cut on car tab fees, they want to eliminate the Minnesota Care tax on medical care, something they say would also help lower-income people by holding down insurance costs.

House Republicans also have complaints about the budget deal. Many of them think it spends too much and leaders like tax chairman Ron Abrams says he sympathizes, especially on items like the $60 million for light rail [transit].

Abrams: You know, the LRT, I agree with them, it's a very, very, very large pill to swallow. But I take a different view…spending increase still the smallest in years.
House Democrats, largely spectators so far this year, see a rare opportunity for themselves in this situation. Speaker Steve Sviggum will probably need DFL votes to pass some of the spending items that make up the budget agreement, and he'll need their help for sure to get light rail, because it's a bond issue and requires a three-fifths vote. Democrats are already wondering out loud what they might get in return for those votes; one of them says he thinks they could get money for all-day kindergarten.

The most die-hard fiscal conservatives are already finding ways to show displeasure with the deal. Phil Krinkie, the de facto spokesman for the budget-cutting faction of the Republican caucus, took the unusual step of just giving up. As chairman of the House State Government Finance Committee, he simply gave in to the Senate position on almost all spending issues relating to state agency budgets - essentially rolling over on millions of dollars in extra spending. He then said he wouldn't vote for the bill when it gets to the House floor. Most insiders took the gesture as a slap at House leadership and Krinkie made it clear that he thinks the budget deal undermined the budget cutters among the House Republicans.

Krinkie: The caucus within the caucus held together, so then, in this negotiation to move the target up by $30 million there wasn't a lot of negotiating position left for the House.
Krinkie's move may also have been a tactical decision to avoid increasing his budget even further; in recent days, Governor Ventura has been putting pressure on both the House and Senate to increase substantially the money they put into new computers for the state. By giving in to the Senate, Krinkie has probably closed the door on the Governor's requests.

Public broadcasting is an unintended beneficiary of Krinkie's surprise move. The House version of the state government finance bill had about one third less money for public TV and radio than the Senate did and no money at all for Minnesota Public Radio, which has been lobbying for about a million dollars to build new transmitters. In accepting the Senate position, Krinkie also accepted about $6.7 million for public broadcasting - including $800,000 for MPR. But that money is not home free, yet. The overall bill still needs to pass both House and Senate, and Governor Ventura - an opponent of state money for public broadcasting - still has the option of line-item vetoing the money.