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Will the budget harm Minnesota's quality of life?
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Many critics say cuts to subsidized child care could have a negative outcome on the state's quality of life. (MPR Photo/Tom Scheck)
Minnesota's new budget has been law for barely a month, too soon for nonprofits, local government officials and health care professionals to know its full impact. In May, led by Gov. Tim Pawlenty and Republican House, the Legislature passed a two-year budget that erased a $4.2 billion deficit without raising taxes. Critics warned that approach would threaten Minnesota's high quality of life.

St. Paul, Minn. — Groups that rate a state's quality of life consider a wide range of factors. They include: taxes, personal income, crime rate, spending on education and the number of people with health insurance. It will be months, even years, until new rankings are released.

On a recent summer morning, about a dozen patients from different ethnic backgrounds wait to see a doctor at the Community University Health Care Center in Minneapolis.

Karl Self, the clinic's executive director, says clinics that provide free or reduced health care are expecting many more patients. That's because government estimates say 38,000 Minnesotans will lose their state sponsored health insurance between now and 2007.

Minnesota is currently ranked fourth in the nation based on the number of its citizens with health insurance.

Self says there's a connection between the state's quality of life and the social services it provides.

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Image Karl Self

"The reduced revenue that comes from the government to support these services now is not trimming away fat in the system," Self said. "It's really taking away the meat of our ability to meet these needs."

Too little for too much?

The current budget also changes eligibility requirements for child care. Supporters of the change say Minnesota's program was too generous for the state's financial situation. They contend that Minnesota will still have a top notch program.

Child care advocates, however dispute those numbers. They say 1,200 families have been cut from the child care assistance program. Others says they'll struggle to pay for child care at clinics like the Lasting Impresions Learning Center in St. Paul. For the parents of these kids already enrolled in the program, the state's eligibility rates were rolled back slightly.

But the rates have been cut drastically for people who will apply for child care assistance for the first time. The Children's Defense Fund says the state's child care support system was second in the nation last year.

"We have crossed over that fine line where we are now more interested, this governor, this administration are more interested in the bottom line tax cut and govenment spending than we are in solving problems," says executive director Jim Koppel, who expects the changes will lower Minnesota's rank to 30th.

State spending still growing

"I expect after a little bit of adjustment that Minnesota will retain and regain and remain a top-ranked state in most categories that matter," Gov. Tim Pawlenty said.

As we slow our budget growth, almost every other state in the union is doing the exact same thing. With a very few exceptions, our relative rank, grade and status in most of these programs won't be impacted much because almost every other state is in the same boat.
- Gov. Tim Pawlenty

Gov. Pawlenty says the budget was an attempt to slow state spending that was growing at double-digit rates.

"As we slow our budget growth, almost every other state in the union is doing the exact same thing," Pawlenty said. "With a very few exceptions, our relative rank, grade and status in most of these programs won't be impacted much because almost every other state is in the same boat."

Some of the governor's fellow Republicans have their own concern with rankings, such as total tax revenue and welfare spending.

Too much spending, Sviggum says

The U.S. census ranks Minnesota fifth in total tax revenue per capita, a basic measure of each citizens tax burden. Republican House Speaker Steve Sviggum, R-Kenyon, says he'd like to see Minnesota lose that top-10 ranking.

The census ranks Minnesota fourth in per-capita welfare spending. Sviggum says the recent welfare reform legislation aims to help citizens. He says the Legislature has established core priorities.

"It's not my goal to be number one in everything," Sviggum said. "We want to be in the balance. We want to be in the balance of what's appropriate. We want to make sure we set priorites for grandpa in the nursing home, we have to set our priorities for the developmentally disabled and for schools. I would like to be number one in those areas."

One analyst with state government experience says he doesn't expect the state's quality of life to suffer under the new budget.

Curt Johnson, the former chief of staff to former Republican Gov. Arne Carlson, and also the former chair of the Metropolitan Council, believes the new budget is a proper course correction after the economic boom of the late 1990s. But he warns, any additional cuts should be carefully considered.

"If, in fact, we are reducing our true commitment to preparing people to fully participate in this economy then this is going to hurt because that has been Minnesota's distinct comparative advantage," Johnson said.

Johnson says Minnesota will be watched closely because it's one of many states that cut spending and didn't raise taxes. Gov. Pawlenty says he'll try to restore some of the cuts if the economy improves.

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