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St. Paul, Minn. — In his first State of the State address a year ago, Gov. Pawlenty said Minnesota was facing the "Incredible Hulk" of budget deficits, a projected $4.5 billion gap. A year later, Pawlenty says the budget gap has largely been closed, and the state's outlook is brighter.
"In the last couple years, we've been tested by war, recession, layoffs, terrorism and historic budget deficits," Pawlenty says. "But I'm here to tell you, the spirit of Minnesota is strong, and so is the state of our state."
Pawlenty says Minnesota still faces a modest deficit that could be several hundred million dollars in the budget forecast released later this month. The state's financial picture doesn't give Pawlenty much room for initiatives that cost money, but he outlined several proposals that he wants the Legislature to approve borrowing money for.
They include the Northstar commuter rail line, a bioscience research partnership between the University of Minnesota and the Mayo Clinic and more prison beds. Pawlenty repeated his no-tax-increase stance, and said now is not the time to raise taxes in Minnesota.
"Tax increases hit job creators right where it hurts -- the bottom line. If we want to compete, we need to prove to job creators we mean business on taxes," says Pawlenty.
Tax increases hit job creators right where it hurts -- the bottom line. If we want to compete, we need to prove to job creators we mean business on taxes.
DFL lawmakers took issue with Pawlenty's no-tax-increase claim.
"If you say the big lie long enough, people believe it," says Sen. Larry Pogemiller, DFL-Minneapolis, who chairs the Senate Tax Committee. He says Pawlenty should be held responsible for double-digit property tax increases in many Minnesota communities that suffered cuts in state aid.
"The governor raised taxes. He raised property taxes and he raised fees, he has made our tax system less fair, it's the wrong direction for Minnesota," Pogemiller says.
During last year's State of the State address, Gov. Pawlenty singled out Phyllis Bakke of Northfield. She sent Pawlenty a dollar to help solve the state's budget problem. Pawlenty sent Bakke's dollar back to her this week, with 25 cents interest. DFL Senate Majority Leader Dean Johnson of Willmar says Bakke will need her dollar.
"If she has grandchildren, this dollar could have gone toward the tuition increase that our students are paying in Minnesota this year and next year ... something of 25 to 30 percent," Johnson says. "If Mrs. Bakke was going to a state park, this dollar would not satisfy the increase in fees that she's going to have to pay."
The governor didn't mention Bakke in this year's speech. This time, he recognized the parents of Dale Panchot and Brian Hellerman, two Minnesota soldiers who died in Iraq. Lawmakers gave the soldiers' families the longest standing ovation during a state of the state in recent memory.
Pawlenty also recognized Mark Johnson, the Cold Spring football coach who helped disarm a student in a fatal school shooting, and the son of Olympic hockey coach Herb Brooks, who died last year.
Pawlenty used his speech to push a number of initiatives he's proposed in the last few months -- education reform, longer sentences for sex offenders, a constitutional amendment on the death penalty, toll lanes and a water quality initiative. Pawlenty says education, public safety and the environment are part of Minnesota's quality of life.
"We love it here, but not everybody appreciates the Minnesota way of life. If we're going to convince talented, innovative people to stay here, invest here, and relocate here, we've got to have plenty of live bait on the hook," Pawlenty says. "That will be a big part of whether we succeed in the new economy."
In the past, Pawlenty has listed Minnesota's professional sports teams as part of the state's quality of life. But his speech said nothing about the Twins or the Vikings and their requests for new stadiums -- a topic likely to heat up shortly at the Capitol.
While silent on the subject of stadiums, Pawlenty waded into the gaming debate. He opened the door to renegotiating tribal gaming compacts, an issue that divides the Legislature. He also called for rethinking the future of higher education in the state, and said he'll soon announce a long-term care reform package.
DFL leaders say the speech lacked bold initiatives, while Republican leaders called it a road map to hope. Not exactly the kind of bipartisan agreement Pawlenty said he hopes to see this session.