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Minnesota Government Update


December 5, 2008


State Facing $5.28 Billion Budget Deficit
The state's budget deficit for 2008-09 is $426 million and is currently predicted to be a $4.85 billion shortfall for the 2010-11 biennium, totaling $5.28 billion. This is a significant increase since the last forecast. Minnesota Department of Management and Budget (MMB) Commissioner Tom Hanson attributes the deterioration of the budget to the accelerating weakness of the national economy. Hanson and other MMB officials stated the recession will be longer and deeper than anticipated. Forty-one other states face budget deficits as well, with several states facing even steeper deficits.

Governor Tim Pawlenty will meet with legislative leaders to discuss strategies for closing the shortfall, including potentially using unallotment for the current budget year. Pawlenty also plans to use a zero based budgeting approach for the next biennium. The MMB predicts revenues of $32 billion for the 2010-11 fiscal year. The Governor intends to build his budget by starting at zero and working up to $32 billion. He will not start with a wish list and will not spend past the predicted income. He also quickly ruled out a tax increase, suggesting this was an opportunity to streamline government and reform the way government delivers services to taxpayers. The Governor called for swift action to erase the debt. He will spend down the $155 million in budget reserves and then move on to unallotment.

The House and Senate DFLers also addressed the deficit before a full press corps. Senate Majority Leader Pogemiller (DFL-Minneapolis) indicated the need for new leadership to grow jobs in the state of Minnesota. Speaker of the House Margaret Anderson Kelliher (DFL-Minneapolis) told the crowd that no option should be taken off the table when solving the deficit problem. Kelliher embraces the zero-based budgeting approach proposed by the Governor and plans to work with Pawlenty.

The House and Senate Republicans held their own press conference to discuss the budget deficit. Minority Leader Marty Seifert (R-Marshall) stated the need for job creation with a focus on priorities and presented this as an opportunity to reform government. Seifert suggested the Governor's use of unallotment of the budget should begin sooner rather than later to help close the deficit. He also indicated that a recession is the worst possible time to increase taxes to grow government programs. Senate Minority Leader David Senjem (R-Rochester) noted the time has come to fix the tax and regulatory climate so we can grow jobs in the state of Minnesota.

Coleman/Franken Recount Drags On
In the US Senate recount there are once again issues with missing ballots. This time the alleged missing ballots are in Minneapolis, a Franken stronghold. Secretary of State Mark Ritchie has allowed Minneapolis time to find the envelope of missing ballots. An unofficial count from the Star Tribune indicates a 251 vote Coleman lead, a net increase of 36 votes from the beginning of the recount. The State Canvassing Board will meet on December 16 to review 6,000 challenged ballots. Wright County and one precinct in Minneapolis are the only two areas still counting ballots.

Leadership Teams Announced
Last week the House DFL announced their newly elected leaders. The Republicans followed suit this week. House Republican Minority Leader Marty Seifert (R-Marshall) will be partnering with Deputy Minority Leader Steve Smith (R-Mound) and Minority Whip Dan Severson (R-Sauk Rapids). The new Executive Board members for the caucus are Sarah Anderson (R-Plymouth), Randy Demmer (R-Hayfield), Bob Gunther (R-Fairmont) and Carol McFarlane (R-White Bear Lake). Speaker Margaret Anderson Kelliher (DFL-Minneapolis) has not yet announced the committee structure for the 2009 session.

Session Help
Alexandra David will be joining the Winthrop & Weinstine team for the 2009 legislative session. Ms. David is hot off the recount effort for Al Franken and previously worked with the Obama team in Minnesota's Third Congressional district.

For up-to-date information about the Minnesota Legislature, tune into Almanac: At the Capitol. This lively and informative program is aired Wednesdays during the legislative session on Twin Cities Public Television at 7:00 PM on Channel 17 and at 10:00 PM on Channel 2.

Almanac: At the Capitol is seen on all public television stations throughout Minnesota and in Fargo. Winthrop & Weinstine is the exclusive law-firm partner and a sponsor of the program.

For more information and to see previous broadcasts, check out the Almanac: At the Capitol Web site at http://tpt.org/aatc/.

 
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