Pawlenty budget ax hits wide and deepMinnesota’s cities, counties and poor people needing health care would be most affected by Gov. Tim Pawlenty’s plan to balance the state budget.
By: Forum Newspapers, News-Chronicle, Lake County News Chronicle
Minnesota’s cities, counties and poor people needing health care would be most affected by Gov. Tim Pawlenty’s plan to balance the state budget.
Pawlenty Monday announced that he recommends cutting:
- $347 million from health-care programs, affecting 40,000 people. Half would lose MinnesotaCare insurance coverage, half would lose or experience cuts in other programs.
- $387 million from other health-care funding. Pawlenty plans to replace that with federal funds.
- $250 million from city and county aid, which would be the second time in a year they have faced a similar-sized cut. The most any city should lose due to this and earlier cuts is 8 percent of its budget, while counties could lose up to 4 percent.
- $47 million from state colleges and universities.
- $181 million from most state agencies and other programs.
The cuts would equal about $500,000 lost this year for Lake County in “unallotments” for county program aid and reimbursements for tax credits on land values.
County Coordinator Matt Huddleston told the county board Tuesday that he expected the aid cuts but not the tax credit loss. Market value credits are what the state pays counties to offset lower property taxes for landowners. Huddleston said the Pawlenty budget proposal would mean a loss of nearly $500, 000 the next two years on the lost credit alone.
“The state match will be gone,” Huddleston said. He was troubled by the cut because because it wasn’t across the board for all 87 counties in the state, like the aid cuts. Only a handful of counties will see drastic cuts in credits. “The question is why is Lake County being hit so hard.”
Counties do not budget for land value credits because they can change dramatically each year. Huddleston said that some counties don’t even budget state aid anymore because of the continued cuts in St. Paul.
The city of Silver Bay may be facing deeper local government aid cuts than once originally thought.
On Tuesday Mayor Scott Johnson said the city could be facing another $158,000 in cuts on top of the already expected $110,000 cut.
If the $110,000 and $158,000 cuts did happen, it would mean Silver Bay would be getting a 48 percent reduction in LGA.
Two Harbors city officials could not be reached for comment.
Even before Monday’s $1.2 billion proposal, Pawlenty cut $2.7 billion from the current budget last summer, bringing total spending for the two years to just above $30 billion.
The Democratic-controlled Legislature must approve budget changes, and many say they need to raise taxes to keep services at acceptable levels. Pawlenty refuses to allow any state tax increases.
“The historic drop in the economy has caused an historic drop in state revenues,” Pawlenty said. “Government has to live within its means by setting priorities and tightening its belt just like everyone else.”
Most state agencies would experience a 6 percent cut under the plan.
Among Democrats’ big-gest complaints was about the $387 million health-care cut that would be replaced with federal money. The federal funds, part of a health-care reform bill, have not been approved and Pawlenty said he would need to revisit the issue if the funds are not forthcoming.
“It is a budget that is balanced only if we get money from the federal government,” House Majority Leader Tony Sertich, DFL-Chisholm, said.
“The ... cuts to health care are vintage Pawlenty – kick people off their health insurance, reduce benefits, cut payments to nursing homes and rob the Health Care Access Fund,” said Rep. Tom Huntley, DFL-Duluth, chairman of the House health finance committee. “Once again, the poor, the sick and the elderly are being asked to help pay for tax cuts to wealthy corporations.”
The Pawlenty proposal would delay $1.8 million due in March for rural hospitals until July. The plan also would eliminate a number of other health programs, ranging from grants for mentally ill children to those providing drug and alcohol abuse prevention programs for American Indians.
Cuts to elderly services will hurt in a time when more Minnesotans are reaching nursing-home age, senior advocates said.
“The current infrastructure for older adult services is shaky at best — at a critical time in this state,” said Patti Cullen, of Care Providers of Minnesota. “In preparation for the upcoming age wave, we must prioritize older adult services and strengthen the core service delivery system for older adult services. Minnesota cannot sustain the increased demand for services if we continue with our current payment and delivery system.”
The governor would cut some business taxes.
Fees would raise little under the governor’s proposal, but some money brought in by fees would be transferred from specific funds to the state general fund.
The governor said that he set priorities when he made his proposals, but federal rules tied his hands. The Republican governor said he would have cut higher education funding more than he did, but since the state accepted federal funding last year, rules limit how much he could cut.
As for city and county aid, Pawlenty said those programs just are not as important as ones he saves, such as public schools, the military, veterans and public safety.
The head of the League of Minnesota Cities called local cuts “catastrophic.” Jim Mill-er said that without state tax increases, cities will have no options other than to raise property taxes or cut services.
Cities already have cut budgets, he said, and there is little left to cut.
“The governor’s proposal will be devastating to Minnesota communities,” Cloquet Mayor Bruce Ahlgren said, speaking for the Coalition of Greater Minnesota Cities. “If this is passed, Minnesotans need to brace for deep reductions in snowplowing and pothole repair, fewer police and firefighters, closed libraries, closed parks and closed community swimming pools.”
It took little time for Democrats and Republicans to find a $387 million hole in the pawlenty plan.
Pawlenty said money would be saved if funds in a federal health-care reform bill are approved. on Tuesday fellow Republican U.S. Rep. John Kline, who serves a district east and south of the Twin Cities, said he has questions about whether that bill will win approval this year.
Kline is a top House Republican on health care and was due to meet Thursday on the subject with President Barack Obama.