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Minnesota's economy may be on ropes, but Pawlenty ups spending

ST. PAUL -- Gov. Tim Pawlenty's newest budget plan increases education, courts and other spending, despite a worsening economy. And he still opposes raising state taxes, although Democrats say his policies would force nearly $2 billion higher local property taxes.

News early this month that the budget slipped $2 billion deeper into deficit was more than offset by federal economic stimulus money, so his new budget plan differs relatively little from his first proposal.

However, Democrats took off the gloves after weeks of criticizing Pawlenty's budget around the edges, saying his plans would be disastrous for the state beginning in 2012.

Pawlenty's new budget plan for 2010-11 would slightly increase spending for public school education, higher education, local government aid and public safety. However, it would cut state-run health programs $1.4 billion.

The Republican governor's new budget plan calls for spending $32.6 billion the two years beginning next July 1, compared to a $33.9 billion current budget. The budget deficit would be $6.4 billion without more than $2 billion in federal funds.

"In these tough economic times, we can't do everything, but we will do what's important to help our state moving forward," Pawlenty said. "For starters, government will live within its means and not pile a big tax increase on families and businesses who are already struggling."

Education is the biggest winner in the new budget plan, thanks to federal money.

Public school education would receive $27 million more under the new plan than Pawlenty's initial plan, for a total of $14.2 billion in the next two years. Higher education would do even better, getting $304 million more than planned just two months ago, meaning it would receive the same in the next budget as it does now.

While Pawlenty at least holds education funding even with the current budget, Senate Democrats have called for a 7 percent state budget cut across the board, including in education. Federal money could be used to soften the blow, but Senate Majority Leader Larry Pogemiller, DFL-Minneapolis, said that education must deal with smaller budgets like every other state-funded program.

The most controversial part of the budget is Pawlenty's plan to cut health spending.

Human Services Commissioner Cal Ludeman said the Pawlenty budget encourages poor Minnesotans on state programs to use clinics more and emergency rooms less. A doctor's office visit costs less than one to an emergency room.

Hospitals would lose "tens of millions of dollars," Ludeman said.

The governor's proposal would chop $1.4 billion from his earlier $11 billion health and human services budget, in part because of the plan to divert patients from emergency rooms.

"The governor's funding for the next biennium assumes there will be no growth in health care, which is not only unrealistic, but statistically impossible," Rep. Tom Huntley, DFL-Duluth, said of Pawlenty's 2012-13 spending plan. "Once again, Gov. Pawlenty imposes a disproportionate share of cuts on health care -- causing harm not just to thousands of hard-working Minnesotans, but also to our struggling health care industry."

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.