No easy fix for state's budgeters
Solving a potential $5.8 billion state budget deficit is no easy task, as candidates running for governor of Minnesota are finding out.
Republican candidate Tom Emmer on Tuesday released the third and final chapter of his budget solution. The plan will work well for businesses and high-income taxpayers but will drain the pocketbooks of rural Minnesotans and college students and put K-12 education and our most vulnerable citizens at risk.
Rep, Emmer proposes to continue the Gov. Tim Pawlenty "no new taxes" era by pledging not to raise taxes. But he would go even further in finding state budget cuts to bring expenses lower than revenues, allowing $600 million to cut business taxes.
The Emmer budget includes a $700 million cut in state aid to cities and counties, a $300 million cut to higher education and basically freezing K-12 funding and ignoring paying back the $1.8 billion shift in state aid to schools under the Pawlenty administration. Rep. Emmer does propose an increase in health and human services funding, but way below the increase projected to meet mandated services.
Aids to local governments have been cut each year under Pawlenty, and there isn't more to cut without losing basic services such as fire and police. We give credit to Rep. Emmer for also proposing a major formula change, but accompanied by the cuts will still force property tax hikes for many cities, most in rural Minnesota.
Making students pay more for college will also limit access to higher education for many Minnesotans and affect the delivery of quality post-secondary education.
Minnesotans waited a long time for Rep. Emmer's plan, and the message should be: Go back and try again.
But there's plenty of criticism to go around.
The state Revenue Department on Tuesday vetted Democrat candidate Mark Dayton's call for higher taxes on Minnesota couples making $150,000 or more, which he said would raise $4 billion over the two-year state budget.
Don't count on it, the state agency said, projecting the Dayton tax increase to make $1.9 billion for the state, woefully less than Sen. Dayton wanted. The $1.9 billion is based on a 10,95 percent tax bracket for married joint filers with an annual income of at least $150,000. The former senator also proposes raising property taxes on homes worth at least $1 million.
How much is enough? One might ask the senator. Do you tax all Minnesotans at a higher rate, or call for a surcharge to make up for the needed $2 billion more? And will Minnesotans accept such a large tax increase? We think not.
To Sen. Dayton: Go back and try again.
Today's editorial was written by the Bemidji Pioneer, which is a sister newspaper to the Wadena Pioneer Journal. Both papers are owned by Forum Communications.