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Senate-House gulf widens as Minnesota Legislature heads toward adjournment
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A group called "Minnesota is Watching" called for tax increases as part of the budget solution at a news conference on Wednesday. They used a mock map of Minnesota to show the state's priorities, and said the state crumbles if one of the pieces is removed. (MPR Photo/Laura McCallum)
With less than two weeks left in the legislative session, Gov. Pawlenty is urging legislative leaders to reach a budget deal. The call came as the House was passing a vastly different tax bill than the one that passed the Senate last week. And taxes aren't the only issue on which the House and Senate are far apart.

St. Paul, Minn. — Gov. Pawlenty says time is running out for budget negotiations. The state constitution requires that the Legislature adjourn in a week and a half, and the House and Senate must still reach agreements on all major budget bills.

It's time for negotiations, says Pawlenty, not flying around the state, as Senate Majority leader Dean Johnson did Wednesday to promote the Senate DFL's budget plan.

"We need to make our very best efforts to get this session done in a timely and appropriate manner for the state of Minnesota. Again, I don't begrudge Sen. Johnson two days of promotional tours, it just shouldn't come at this critical juncture in the session," he said.

Johnson defended the fly-around, saying he needs to explain the Senate DFL budget to Minnesotans who've been bombarded by anti-tax ads from business groups and the state Republican Party.

"Well, number one, we don't have $500,000 by special interest groups for ads, and we do not have the money in the Democratic Party to buy TV airtime to this magnitude. So we have to go out one furrow at a time and plow one field at a time and talk to the people," Johnson said.

Pawlenty's advice notwithstanding, Johnson plans to stick to his second day of appearances around the state. He says Minnesotans support the Senate plan to increase spending on education by nearly $800 million. He says the public also agrees with the Senate that the state shouldn't cut people from MinnesotaCare, the state's subsidized health insurance program.

To pay for the increased spending, Senate Democrats want to raise income taxes on the wealthiest Minnesotans, a plan Republicans call a job-killer.

This bill does a lot to benefit taxpayers, businesses, job creators and citizens and working families across the state of Minnesota.
- Rep. Phil Krinkie

Pawlenty and Republican leaders say they won't raise state income taxes. Instead, the House passed a tax bill on Wednesday that, among other things, would extend alcohol and car rental taxes set to expire.

It would also allow property owners to reverse property tax hikes approved by local officials. The plan pushed by Pawlenty would send taxpayer satisfaction surveys to property owners each fall. If 20 percent of the postcards returned indicate objections to the level of property taxes, a public vote would be triggered.

Rep. Jean Wagenius, DFL-Minneapolis, says Pawlenty wants to allow people who own multiple properties to fill out a postcard for each one.

"He has great creativity when it comes to giving benefits to his governor's rich friends. In this case, he's actually outdone himself. The more property you have, the more benefit the governor gives you," accordig to Wagenius.

Supporters of the measure say it allows citizens to hold government officials accountable for tax decisions. The House tax bill would also lower state aid for Minneapolis, St. Paul and Duluth, and cut $66 million a year from a program targeted to low-income renters. The bill's sponsor, Republican Phil Krinkie of Shoreview, says his bill would let married couples take full advantage of federal tax cuts. And it would spare some middle-income tax filers from getting hit with the so-called alternative minimum tax.

"This bill does a lot to benefit taxpayers, businesses, job creators and citizens and working families across the state of Minnesota," Krinkie said.

During more than 10 hours of debate on the bill, lawmakers voted to make it easier for local governments to raise the sales tax by a half-cent for capital improvement projects. Krinkie's bill must now be reconciled with the far different Senate tax bill.

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