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Dayton's budget a good start

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Gov. Mark Dayton's budget for Minnesota will be picked apart, criticized, praised and embraced during the legislative meat grinder. That's the way the system is supposed to work. In the end, elements of Dayton's proposal either will be gone or unrecognizable; others will become law. No matter the outcome, Minnesotans can expect a less confrontational and more productive session than in the recent past.

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What in all likelihood will not happen during the current legislative session is the dour expectation that gridlock will force a state government shutdown, a circumstance that was almost the routine during the Gov. Tim Pawlenty years. While there is much in Dayton's budget to raise the ire of fiscal conservatives, the flip of the Legislature from Republican to Democratic control all but guarantees that even the threat of a shutdown will not materialize. Republicans took a beating at the polls in November in part because Minnesotans blamed them for dysfunction in St. Paul.

To no one's surprise, Dayton wants to raise taxes. His first targets are the people he describes as "rich," the 2 percent of Minnesotans who earn more than $150,000 (single filers) or $250,000 (joint filers). He wants to raise tobacco and cigarette taxes. He would cut the sales tax, but broaden the base to such items as clothing and services, proposals that have not been received well.

On the other side of the governor's tax coin is direct homeowner property tax relief with a $500 rebate. How that would be applied fairly has yet to be revealed. And whether the rebate would be sustainable is uncertain. His budget also calls for business property tax cuts.

There is no question that the past decade saw a shift in the tax burden from the state to cities, counties and schools. In Moorhead, for example, state aid lost per capita was about $213, which resulted in an $84 per capita property tax increase (76 percent), and a gap of about $130 per capita (including loss of the Homestead Credit), which meant cuts in services.

Local Government Aid to Moorhead was cut deeply over 10 years, from $377 per capita in 2002 to $174 in 2013. Dayton's budget would restore a portion of the loss.

LGA, property tax rebates and other initiatives are among those elements in Dayton's budget that could have immediate and dramatic results among local governments. But there is much more in his proposal, including huge investments in economic development and education that will dominate the debate. On balance, Dayton presented what appears to be a no-gimmick, transparent and reasonable budget proposal. It should not be rejected out of hand by Republicans. They certainly won't agree with all of it, nor should they. But there are pragmatic and needed provisions in the Dayton plan Republicans can support.

The Forum of Fargo-Moorhead

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