Rukavina talks state budget at Ridgewater

WILLMAR -- It's going to take a combination of budget cuts and higher taxes to get Minnesota out of the budget deficit it will face next year, according to State Rep. Tom Rukavina.

Rukavina, DFL-Virginia, met with about 30 Ridgewater College students and staff Tuesday morning as part of a three-day tour of college campuses in western Minnesota.

He is chairman of the House Higher Education and Workforce Development Finance and Policy Committee. He said he has been making similar college tours around the state since last summer.

Rukavina is one of a number of legislators running in the 2010 gubernatorial campaign. He did not bring up his run for governor, but he was highly critical of Republican Gov. Tim Pawlenty, who is not seeking re-election.

The Legislature is likely to face a budget deficit of $7.5 billion when it convenes next year, he said.

"If we don't do something to raise revenue ... I don't know what's going to happen," he said.

The state of Minnesota developed a structural problem with its budget early in this decade, and nothing has been done to correct it, Rukavina said.

Income taxes were cut nearly $900 million a year in 2000. In 2001 the state took over education costs for all districts in the state, including suburban districts that had not received state aid before. That added $1 billion in costs to the state budget.

The two actions cost the state $4 billion over each two-year budget, Rukavina said.

State government has not done anything to correct that imbalance in the budget, he said.

"What we've done instead is to put a tax on you," he said, pointing to the students in the room. There are hidden taxes in their tuition and fees, he said to the students.

Rukavina, an outspoken DFLer, didn't hide his disdain for Pawlenty's "no new taxes" pledge.

Despite the pledge, "we've really figured out a way to hammer all of you," he said.

Pawlenty's pledge may have kept some taxes in check, but property taxes and numerous fees, which are actually taxes, have increased during his time in office, he said.

One student asked if the Legislature could look for areas of waste in state government.

"There's not much fat left," as budgets have been cut for years, Rukavina said. "We haven't had any new spending."

He'd like to see some federal requirements eliminated and perhaps find a way to reduce the number of people on probation for minor offenses, he said.

"If you have some examples, let me know," he said. He urged the students to contact him or their local legislators if they felt they saw instances of government waste.

One student told Rukavina he would rather pay higher tuition than have his income or property taxes increase.

"It was tax dollars that kept your tuition increase at 3 percent," he said. Without federal economic stimulus funding, state colleges would have seen double-digit tuition bumps, he added.

Asked about the state's impact on K-12 education funding, Rukavina said many school districts are struggling under the funding mechanism set up in 2001.

Cities and counties can raise property taxes without asking the voters, but schools can't, he said.

"The only place you get to vote on your property taxes is against kids," a situation Rukavina called "stunning."

In the case of school funding, he added, "the money's got to come from somewhere."