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Rep. Al Juhnke of Willmar leads a recent House committee meeting in which lawmakers voted to cut agriculture funding nearly 8 percent. (Don Davis/ForumCommunications Co.)

Ag committee struggles illustrate state's overall budget problem

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ST. PAUL -- Members of the Minnesota House agriculture finance committee looked through their budget for any place to cut.

For instance, they decided to reduce what the state pays to the Minnesota Livestock Breeder Association by $1,000, practically nothing compared to the state's $31 billion, two-year budget. But as state lawmakers struggle to plug a nearly $1 billion gap, they are looking everywhere.

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The committee, which also deals with veterans' issues, has one of the smallest budgets of any area, $208 million. Gov. Tim Pawlenty and most lawmakers pledge not to reduce veterans' spending, so the committee's spending-reduction goal all comes from agriculture programs.

"We are trying our darnedest in this difficult time to continue core services," committee Chairman Rep. Al Juhnke, DFL-Willmar, said, such as making minimal cuts to programs such as food inspection.

However, Juhnke said, agriculture cuts do not affect everyone the same.

"In the ag budget, almost everything being cut is in rural Minnesota," he said.

Particularly noticeable is the delay of $2.3 million in payments being made to ethanol producers. The money, promised more than 10 years ago, is to be paid in the next two-year budget cycle, but the delay does help balance the current budget.

Like many small agencies across state government, the Board of Animal Health would be cut more than 6 percent.

"Even though these cuts are painful, they can handle it," said Rep. Doug Magnus, R-Slayton.

Total House agriculture cuts are $5.9 million, 6.7 percent of the ag budget.

While Juhnke and other rural lawmakers complain that is a larger percentage reduction than many other departments face, it does illustrate the problem lawmakers are tackling throughout state government.

Legislators in 2009 approved the two-year budget that began last July 1. But continuing recession impacts have kept revenues lower than expected. Much of the 2010 legislative session is devoted to tweaking the budget so that it is balanced, as the state constitution requires.

In the next few days, the Senate Finance Committee and House Ways and Means Committee are to finish putting together the first of three bills to cut state spending. The first, taking in most state spending other than public schools and health and human services programs, would cut $313 million and could be in front of the full House and Senate within a week.

Senate Majority Leader Larry Pogemiller, DFL-Minneapolis, has been the main advocate for reducing spending in three phases, going from the easiest-to-cut areas in this first bill to the most difficult in the third. Pawlenty has said he would prefer to see an overall budget proposal, but said he will look at the phased-in cuts legislative leaders plan to send him.

Health and human services program reductions are due to be debated next, with public school funding coming last.

Each of those phases could cut about a third of the $994 million deficit, but legislative leaders and Pawlenty say they hope the federal government comes through with more than $300 million for health programs, which could save public schools from any cuts.

Democratic leaders, who control the Legislature, will not say if they expect to pass a tax increase, but many of their members want one to help balance the budget. Pawlenty and most of his Republican colleagues say they cannot support higher taxes.

The Phase 1 House and Senate budget cut plans look different, so after both bodies pass their measures, negotiators will work out differences before sending the bill to Pawlenty.

In many cases, House and Senate plans call for deeper cuts than Pawlenty.

For instance, in the environment and natural resources budget, Pawlenty would cut 4.5 percent of the budget, while the House proposes 5.6 percent and the Senate 5.8 percent. In the agriculture budget, the House and Senate took different priorities than did Pawlenty.

At times, political considerations trump strict financial discussion. Juhnke's committee left intact aid to county fairs, while Pawlenty cut $28,000.

"I didn't want any of you to go home and say you didn't get your $3 premiums" given to 4-H members, Juhnke told fellow representatives.

But those 4-H'ers should not expect in the future to receive even the token amount now provided by the state, as Minnesota faces a multi-billion deficit in the next budget.

"These cuts are mild compared to what is coming next year," Juhnke said.

Davis reports for Forum Communications Co.

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Don Davis
Don Davis has been the Forum Communications Minnesota Capitol Bureau chief since 2001, covering state government and politics for two dozen newspapers in the state. Don also blogs at Capital Chatter on Areavoices.
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