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Chamber gives Pawlenty warm reception
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Gov. Pawlenty received a standing ovation at the annual Chamber of Commerce dinner Wednesday night. He told the crowd of nearly 1,000 that his administration would be friendly toward business. (MPR Photo/Tom Scheck)
Gov. Tim Pawlenty assured a group of business leaders Wednesday night that he won't raise taxes to fix the state's $4.5 billion deficit. Speaking at a Minnesota Chamber of Commerce dinner, Pawlenty said business owners can't afford another tax increase. He said it's important for lawmakers to hold the line on taxes, lower the cost of health care and introduce tort reform.

Bloomington, Minn. — Pawlenty got a standing ovation when he was introduced to the crowd of more than 1,000 business leaders, lawmakers and lobbyists. He told the audience that he'll remain steadfast on his pledge not to raise taxes, but didn't offer specifics on how he'll fix the state's $4.5 billion deficit.

Pawlenty says the state needs to go on a financial diet, much like families and business owners who are struggling in the sputtering economy. He said the state can make significant cuts to its social programs and still be on par with neighboring Wisconsin.

"Don't buy this rhetoric that we're going to turn this into Mississippi or Arkansas. We're not," Pawlenty said. "This is Minnesota, a little belt tightening isn't going to hurt. We can still maintain our wonderful quality of life."

Pawlenty said he'd also like to make the state more business friendly, by eliminating some regulations on businesses and by passing tort reform. He says that would help attract businesses and stop the state's loss of jobs. He said 38,000 manufacturing jobs were lost in the last four years, including Blandin Paper's decision to lay off 300 people this week.

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Image Legislative leaders respond to Pawlenty's comments

"It's not about statistics -- it's about our quality of life. And if you want a healthy whole state, you've got to be able to offer a full range, a full continuum so everybody has a shot at a good paying job," Pawlenty said.

DFL Senate Majority Leader John Hottinger said Senate DFLers will work with Pawlenty on the budget deficit. However, he says they'll introduce their own plans to fix the current biennium's $350 million deficit in the next week and a half. He said the DFL plan won't raise taxes.

"We're going to be open to reform. We're going to offer some of our own and we're going to look and see. I think Democrats should be just as angry as anybody else, because I actually think we can do some positive things with it," said Hottinger.

Republican House Speaker Steve Sviggum said he expects his caucus to support Pawlenty's goal of balancing the budget without raising taxes. He said he expects to anger a lot of special interest groups when they make cuts in the coming months.

"We're going to have to reduce government spending. It's plain and simple, folks," said Sviggum. "Whether it's the Highway Helper program -- go out and change your own tire. That's the way I was brought up in Kenyon. I change my own tire in Kenyon, I'm going to change my own tire on the 494 strip. It's plain and simple. If you're in the state planning agency, start looking for a new job."

Sviggum also said House Republicans intend to present a bonding bill to alleviate the state's transportation problems. The bill would authorize borrowing for $1 billion in transportation projects over four years.

That's good news to Waite Park Mayor Carla Schaefer. She says residents in her St. Cloud suburb are frustrated by congestion along the corridor between Waite Park and the Twin Cities. Local leaders and the state chamber of commerce have been calling on the state to increase the gas tax to fund roads and bridges and appropriate funding for the Northstar Commuter Rail Line.

"We're extremely concerned about the future transportation needs and where we're going to obtain that funding from. We certainly don't want to see our transportation take anymore setbacks than we have been taking, in terms of not keeping up with our current needs," Schaefer said.

Others in the audience said they were pleased that Pawlenty's a business-friendly governor. Charles Moline works for Corporate Financial Services in Austin. He says he'd be happy if Pawlenty could loosen the state's regulations on HMOs. He said business owners are frustrated that their health insurance premiums are rising at double digit rates. He said the state's mandates and a requirment that HMOs be non-profit are keeping many health insurance companies from doing business in Minnesota.

"The competition that exists out here in our state is very thin. I mean there are probably a half a dozen fully insured health insurance companies that do business in the state of Minnesota, just because it's so expensive to do business here," Moline said.

Pawenty said he'll announce his plans to fix the state's current budget problems by early next week. Finance Commissioner Dan McElroy says the fix will be about $100 million over the state's $350 million deficit, to address any further dips in the economy.

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