Residual Forces

Is it just me or are the solutions being proposed for the $1 billion budget deficit not including anything meaningful that will prevent deficits in the future and in stead may create bigger ones by simply laying the tracks for this to happen again next year? Via Polinaut

Talks are set to resume at 10:30 Thursday morning. They wrapped up negotiations last night at Midnight after DFLers presented their latest budget offer. It includes a property tax cap of 5.5% and has tails of $150 million for property tax relief ($75m in LGA for Senate - and $75m in direct property tax relief for the House).

OK, sure it is a nice feel good gesture for state taxpayers to subsidize my local taxes, but that is spending more state money, isn’t it? And we have done this before. The problem with property taxes is that municipalities are spending like crazy and so are the schools. That’s why your property taxes are outrageous. Municipal Welfare

The plan also takes $2.5 million from Governor Pawlenty’s Achieve initiative and makes cuts of $1 million each to the University of Minnesota and MnSCU and $500k cut to Corrections. There’s saving from a GI Bill, they tap the Worker’s Compensation Special Fund, the Minnesota Investment Fund and the plan requires St. Paul to pay $1.5 million for the Arena loan (which the state will pick up later).

So we’re ’saving’ $5 million, but requiring the state to repay the St. Paul $1.5 million payment in the future. That’s $3.5 million ’saved’ out of $1 billion. And we all know that the Universities will be screaming bloody murder next session and that corrections will start letting sexual predators free because of budget cuts so they can stand there with their hand out next budget cycle. (I mean that last part as a joke, but I wouldn’t be surprised)

There are also fees in the offer. There is a Motor Vehicle transfer fee increase of $10 (it generates $10.2 million) and a $5 increase for professional licenses (Electronic Licensing Surchage generates $3.3 million). The plan also shifts inpatient hospital payments by one month generating $10 million.

So the state has blown its allowance and once again they come back and make us pay for it. Kids in the candy shop? I sure hope they get a tummy ache before the rest of us are broke.

We don’t have a revenue problem, we have a spending problem!!!!! 

The Health Plan Reserve Proposal ($50 million) is still on the table but would be backed up by money from the Health Care Access Fund.

So we have money sitting in all sorts of pots, and rather than bail their butts out by using money they already took away from Minnesota families, they are coming back for more. 

DFL House Speaker Margaret Anderson Kelliher said she hoped the offer was a pathway to a deal. Governor Pawlenty’s spokesman said the proposed property tax cap was too high but was optimistic since the two sides are still talking. 

I’m just curious, has there been any discussion on cutting spending? Afterall, that is the problem that caused this deficit. The Governor and Legislature spent more money than it had available. Oh sure, they’ll try to say that revenue was down, but don’t forget they increased spending almost 10% last session. Hell, had they kept it to 3%, they’d have a surplus right now. 

We don’t have a revenue problem, we have a spending problem!!!!