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Gov. Tim Pawlenty announces Tuesday that a bulk of the cuts he plans to make to the state budget come from delaying payments to school districts. All told, he plans to cut nearly $2.7 billion from the next two-year budget.

Pawlenty announces $2.7 billion in budgets, including $300 million from townships, cities, and counties

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ST. PAUL - Gov. Tim Pawlenty today announced plans to cut nearly $2.7 billion from the state budget.

The biggest portion of the budget-balancing action was nearly $1.8 billion in delaying state payments to school districts and other school adjustments. He also would trim $236 million from a variety of health and human services programs and chop $100 million out of state college and university budgets.

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He plans to cut $300 million from state aid to local governments, a plan city and county leaders say will force up local property taxes.

Most state agencies would be cut another 2.25 percent, beyond a Legislature-passed 5 percent cut, which will force an unknown number of state workers out of their jobs.

Pawlenty said the cuts were less than in his earlier budget proposals.

The Republican governor announced his plans to cut the budget, but the actual cuts will not occur until the new budget begins on July 1. He said he could make changes before taking final action.

Pawlenty repeated his oft-stated concept that since families are financially hurting and being forced to cut back, government should do the same.

"The overall impact of these reductions will be to have state government live on about 96 or 97 percent of what it's living on right now," he said. The impact will be felt, but we will get through this difficult economic period and position Minnesota for future growth by reining in government spending and keeping our state competitive."

Democrats said tens of thousands of jobs will be lost under the Pawlenty plan and cuts overall are closer to 10 percent of the state budget. They also said the plan, known as unallotment, will leave the state with a fiscal hole of more than $5 billion when the budget cycle begins July 1, 2011.

Pawlenty took on the task of cutting state budgets after he and Democratic legislative leaders last month failed to reach an overall budget deal before lawmakers left St. Paul for the year. He is using a rarely activated law to "unallot" money that the Legislature earlier allotted.

Budget bills lawmakers passed would spend $34 billion, but just $31 billion of revenue is expected in the next two years. At the last minute of the legislative session, Democrats who control both chambers passed a major tax increase, but Pawlenty vetoed it, saying it is not the time to raise taxes on Minnesotans.

The law Pawlenty is using was written in 1939 to give governors authority to make cuts when it appears revenues are falling short of expectations.

The governor asserts he is on firm legal ground, but organizations ranging from those representing hospitals to state worker unions are looking into whether to sue Pawlenty over the cuts.

"These are problematic," said Jim Monroe, executive director of the Minnesota Association of Professional Employees, the state's second largest union.

Middle class Minnesotans may not immediately see an unallotment impact, Monroe said. However, that will change when the family's son gets hurt at a sports event and discovers the local hospital emergency room full because of health and human services unallotments.

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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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