ST. PAUL -- Minnesota's new governor wants state agencies to stop their spending sprees.
"Let's not be spending like drunken sailors," the governor's spokesman, Dan Wolter, said state officials were told.
A memorandum Gov. Tim Pawlenty ordered sent to all agencies under his control asked them to "not spend any funds that are not currently under a contractual obligation."
State Budget Director Peggy Ingison said her memo asked agencies to wait before spending money, but on Thursday Democrats said $9.1 million of Dislocated Worker Program payments to unemployed Minnesotans had been frozen.
Sen. Dallas Sams, DFL-Staples, said the Republican governor, on the job just three days, is "hitting the most vulnerable people right off the bat."
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Ingison said no one from the program asked for permission to go ahead and spend money. She said if the worker program, or any other one, needed to spend money, she would give it permission.
The stop-spending request only lasts until Pawlenty and legislators agree on how to fill a deficit in the budget that ends June 30. Legislative leaders say they hope that comes in less than two weeks.
The memo follows meetings Pawlenty held with departments that seemed to indicate they were spending money to beat the budget fix, Wolter said. They did not appear to understand "that we are in a budget crisis," he said.
Wolter said he does not know what agencies upset Pawlenty.
"We are asking them to give us some time here, so we have some options open," Wolter said.
That is reasonable, said Sen. Keith Langseth, DFL-Glyndon. There should be no problem waiting a week or two, he said.
In fact, Langseth said, he asked that a $117 million payment to the state from a tobacco lawsuit be held until state officials decide how to plug the current deficit. Otherwise, it goes into an investment fund.
"This is cold cash," Langseth said, and it may come in handy filling what was expected to be a $356 million budget gap this year.
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State Economist Tom Stinson Thursday told senators they should find $500 million to balance the current budget deficit instead of $356 million.
"We could easily have another late May or June surprise," Stinson said.
Without the cushion, higher expenditures or lower tax revenues than expected could put the state budget in deficit at the end of the fiscal year on June 30. But the state Constitution forbids a deficit budget at the end of a fiscal year.
The news doesn't get better down the road. Senate Finance Chairman Richard Cohen, DFL-St. Paul, said when he adds the $4.2 billion 2003-2004 budget deficit to other costs, including a reserve to handle last-minute expenses, it appears lawmakers need to find $6 billion.
Readers can reach Forum reporter Don Davis at (651) 290-0707
