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Capitol Chatter: Dayton administration worries about tight budget

Commissioner Myron Frans of Minnesota's finance agency talks in early 2017 about the state budget. In July, he said that the current two-year budget is tight and several factors could cause financial problems. Don Davis / Forum News Service1 / 2
Don Davis of Forum News Service2 / 2

ST. PAUL — Minnesota government will not have much left over when the just-started two-year budget cycle ends, Dayton administration officials say.

A new report shows there will be $163 million left from the new $45 billion budget in two years (although money the state already has in the bank still could be there). And that is if things go well financially.

Officials like Commissioner Myron Frans of Minnesota Management and Budget, the state finance agency, always want to pump up reserves in case the economy goes south, taking state revenues with it.

This budget could provide the smallest donation to the reserve fund in years, Frans said. And there are more financial risks now than in recent years.

Frans blames the tight budget on two bills mostly written by legislative Republicans. His boss, Democratic Gov. Mark Dayton, signed both, while mentioning his objections. One reduces taxes for a variety of Minnesotans while the other takes money from other programs and transfers it to transportation.

Those two issues were among the major debates in in the 2017 legislative session, which ended in May. Republicans say government spends too much, but Democrats worry that Minnesotans will be hurt if that money is not available for a variety of other programs.

On top of that argument, however, are two more issues with unpredictable possibilities: the economy and the impact of federal budget decisions.

There also are some signs the economy may be slipping. On Monday, July 10, Frans' department issued a report showing state revenues had fallen. While Frans said he thought spending also may be down, thus balancing out the tax losses, that has not yet been calculated.

The second unpredictable issue is Washington.

"We are keeping a watchful eye on actions at the federal level and monitoring any changes to our economy as we move forward," Frans said.

President Donald Trump's budget proposal would make numerous cuts that could affect state governments. The Republican-controlled Congress is writing its own budget with fewer cuts, but there is little doubt the state will get less money from Washington.

Another issue also raises questions. A state judge is considering the Legislature's lawsuit against Dayton, who vetoed lawmakers' entire 2018-2019 budget. How that case comes out also could affect the budget.

Senators get their raise

Minnesota senators are getting a raise ordered by an independent panel that voters established last year.

But House leaders refused to raise representatives' pay.

Minnesota Public Radio reports that the 67 senators' annual salaries increased from $31,140 to $45,000 because Senate Majority Leader Paul Gazelka, R-Nisswa, thinks the panel's decision is a constitutional mandate. "We are just going to follow that," he said.

House Speaker Kurt Daudt, R-Crown, ordered the House controller not to pay the raise.

A lawsuit about whether lawmakers should get the raise is being considered in court, as is whether Dayton illegally vetoed the Legislature's two-year budget.

Rollover bars in danger

Among programs the president's budget would not fund is one to help farmers afford to install rollover bars on old tractors.

The little-known program is designed to reduce deaths and injuries when old tractors tip over. Newer tractors are required to have rollbars. The rollbar funding has been included in the National Institute for Occupational Safety and Health budget, which would receive nothing in the Trump budget.

Some of the money now goes to a New York-based agency that administers programs in several states, including Minnesota.

The Minnesota program started in 2016 with legislative appropriations, but private companies also contribute funds. The federal funds take care of administering the program, which provides farmers and schools at least 70 percent of the cost of buying and installing a rollbar and safety belt. A farmer would pay no more than $500.

"With no federal funding, we would have to evaluate how to administer the program which would mean the need to seek a significant increase in any funding request," state Agriculture Department spokeswoman Margaret Hart said.

Stras called 'key'

Fox News says Minnesota Supreme Court Justice David Stras is a "key" to the future of the U.S. Supreme Court.

Stas' nomination for a federal appeals court judgeship is pending in the U.S. Senate. He and justices from two other states would gain "valuable experience in the federal nomination process, should they one day be tapped for the Supreme Court."

There is speculation that President Donald Trump may have a chance to appoint multiple Supreme Court justices, and Stras is one of more than 20 he placed on a list of people he would consider.

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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