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Political Notebook: Lawmakers, governor await updated budget forecast

Today, it's all about the numbers.

The governor and lawmakers on Monday will get an updated budget forecast revealing just whether or not Minnesota's budget deficit picture has improved. In particular, all eyes will be focused on the revenue numbers to see if more money is flowing into the state's coffers than originally projected. If so, DFL Gov. Mark Dayton has already said he will update his budget proposal to put some of that additional revenue toward restoring nursing cuts and home health agencies.

November's budget forecast estimated the state will face a $6.2 billion budget deficit in the upcoming two-year budget cycle. Any increase in revenue would be welcome as the GOP-led Legislature and governor try to reach a budget deal. But it's unlikely that the state's financial situation has changed dramatically enough to erase the bulk of that looming deficit.

Republicans reiterate opposition to tax increases

Just in case the governor was unclear about where Republican lawmakers stand on the issue of taxes, members of the Senate Republican Caucus sent him a letter last week reiterating their opposition to any tax increase.


All 37 GOP caucus members signed the letter stating they are not willing to consider tax increases to solve the state's budget woes. The letter reads, "We all are opposed to raising taxes to balance the 2012-2013 $6.2 billion budget deficit. We are all opposed to your budget that increases state spending by over 22 percent. We disagree with your position that government spending should grow to such high levels, when all of Minnesota families and job providers have reduced their own spending."

Dayton's response? The governor said Republicans fail to recognize that their phase one budget proposal, which he vetoed, would have led to $420 million in property tax increases because of cuts to local government aid, according to the Minnesota Department of Revenue. He added that it is time for Republicans to put forward their own budget proposal.

"The time for this rhetorical game playing is over. I submitted my budget, and now it's their responsibility to provide their budget," he said.

Senate Majority Leader Amy Koch, R-Buffalo, said on Friday that the Senate plans to vote this week on the governor's budget proposal.

Davids' 6 percent solution

Republican House Tax Committee Chairman Greg Davids is bringing forward his own idea for raising state revenue. The Preston lawmaker plans to introduce a bill Monday that would require any profits that Health Management Organizations (HMOs) earn on public business above 6 percent would go into the state's general fund. It would not apply to HMOs profit earned from private business. He said a preliminary analysis estimates his bill would raise $150 million in revenue per year.

Davids said a similar measure passed the House floor last year, and he believes this year it would get bipartisan support.

He added "That could go a long ways toward helping us get out of here on time and avoiding a government shutdown."

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