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Minnesota Democrats' budget offers underwhelms GOP leaders
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The offer would prevent cuts to the MinnesotaCare program, said Senate Majority Leader Dean Johnson, DFL-Willmar, at a news conference. He said the cigarette charge should be 55 cents a pack, instead of 75 cents proposed by the Republican governor. (MPR Photo/Laura McCallum)
DFL legislative leaders say they'll support a 55-cent-a-pack cigarette tax increase, if the money goes to health care. The governor has proposed a 75-cent-a-pack increase, but wants to cut health programs. The DFL proposal was part of a much-anticipated budget offer intended to resolve the impasse at the Capitol. But Republican leaders immediately panned the offer, saying it does little to avoid a potential government shutdown.

St. Paul, Minn. — For the last couple of days, Democrats have said they would release a significant budget offer to end the stalemate at the Capitol. As the special session nears the end of its third week, the Republican-controlled House and DFL-led Senate remain divided over major areas of the state budget, most notably, K-12 education and health care.

But the DFL offer is silent on the issue of education. Senate Majority Leader Dean Johnson of Willmar says Democrats want first to resolve the issue of health care.

"The health care bill is extremely important, that we get the MinnesotaCare issue resolved, and we know full well that people will then come together on education. We know that," he said.

Johnson says under the DFL proposal no Minnesotans would be cut from MinnesotaCare, the state's subsidized health insurance program for the working poor. Under Republican budget proposals, single adults with no children would be eliminated from the program.

To pay for state-subsidized health care, Johnson says Democrats are willing to accept a cigarette tax increase. The idea was first proposed by Gov. Pawlenty three weeks ago. Pawlenty proposed a 75-cent a pack "health impact fee." Proceeds would go to state health care programs and free up some money for education.

DFL leaders say they'll support a 55-cent increase and they're still calling for higher income taxes on the wealthiest Minnesotans.

Gov. Pawlenty, who has repeatedly said he won't support an income tax hike, called the DFL offer "deeply disappointing."

"It is not a compromise to propose the highest taxes in the nation, and a grotesque tax increase to fund a health and human services budget that is already out of control and unsustainable," he said.

Pawlenty says the DFL offer is only half of a proposal, because it fails to include K-12 schools. He says budget talks are now back to the drawing board, and he may take his proposed "health impact fee" off the table if the two sides are no closer in a few days.

The looming deadline is July 1, when some government services will shut down if there's no budget deal. DFL leaders say they don't want to force a government shutdown.

House Minority Leader Matt Entenza of St. Paul says their offer includes passage of an agriculture and environment bill that would fund state parks.

"We can guarantee that our state parks stay open, that fishing can occur, that people get licensed without concern or worry and that we can make sure that Minnesotans can enjoy their summer in a way that they deserve," he said.

Gov. Pawlenty says if Democrats are worried about parks, Republicans are willing to pass a bill that keeps them open. He says his office is already making contingency plans for a partial government shutdown, and will release details in the coming days.

So far, the DFL proposal has done little to head off the need for that planning.