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Republicans in House prepare no-gambling "Plan B"
A House committee has adopted spending targets for the next budget that underscore the shaky state of gambling proposals at the state Capitol. The Ways and Means Committee spending resolution outlines two sets of spending levels -- one with casino revenues and one without. Gambling plans have been on hold since late last month as supporters have scrambled to craft a proposal that can win enough votes for passage.

St. Paul, Minn. — After a Senate committee scuttled gambling proposals in that body, supporters of new casinos have tried to keep their hopes alive in the House, but even there prospects are tenuous. Republican Ways and Means Chair Jim Knoblach of St. Cloud says, confronted with that reality, lawmakers needed a Plan B in case gambling revenues never materialize.

"There's some question about the number of dollars that would be there," he says. "There's certainly some questions about whether it passes or not. And we don't want to base our budget entirely on gaming. We want to have a fallback position, and this resolution provides it."

The resolution is an important step in guiding the budget-making process. It sets maximum spending levels for each major section of the state's two-year budget, including education, health and human services, and transportation.

The resolution sets one set of targets that presumes more than $200 million in gambling revenue will be available. Another set presumes the opposite. The resolution passed on a party-line vote of 20-16, with Republicans in favor.

Committee Democrats blasted the two-pronged approach as unwieldy and irresponsible. DFLer Tom Rukavina of Virgina joked that if House leaders want to leave all options open, they should consider a third option that puts Democrats in charge of the process.

"I'm just sitting here flabbergasted," Rukavina said. "This has to be the bonehead idea of the decade. I don't know anywhere in House rules where we had a budget based on a possible passage of a bill possibly in a few weeks or maybe three weeks or who knows how many weeks."

The resolution hinges on whether a bill to put video slot machines at the Canterbury Park racetrack in Shakopee passes. Missing from the discussion was Gov. Tim Pawlenty's plan to open a metro-area casino in partnership with three northern Ojibwe bands.

Knoblach says that doesn't mean the governor's plan is dead, only that it's expected to be merged with the Canterbury Park plan in an as yet unspecified way.

The governor's office is leading discussions on how to combine the two proposals, hoping that a casino that benefits both the participating tribes and the horse racing industry will have broader support than either does separately.

Democrats, however, argued that with or without gambling, the spending targets were too low. DFLers proposed several amendments to use $350 million in the state's cash flow account to boost spending in other areas.

Rep. Tom Huntley of Duluth says the extra money could have been used to preserve state-subsidized health care for thousands who could lose coverage under the GOP proposals.

"This budget, according to the Department of Human Services, will cost 22,500 people their health insurance. And again, these are hard-working people, most of whom have never been on welfare and certainly don't want to be on welfare," Huntley said.

Republicans, however, argued that draining the cash flow fund would leave the state without a financial cushion as it balances daily revenues and expenses. And Republican Fran Bradley of Rochester, who chairs the Health Policy and Finance Committee, argued that Huntley's amendment allowed state health care expenditures to grow unsustainably.

"This is sort of a fantasy world. I could get into all the business about how generous our taxpayers are and everything. But from a fiscal point of view, this ignores the reality of the huge inflation and the fact that we've got to do something to bring these costs into check," Bradley said.

Either of the House's two options spends more on health care than the governor. If the casino money is available, the House would also pump significantly more into education than Pawlenty does. Much of that is made up for by reducing funds for job and economic development programs and state tax credits and refunds.