On Monday, the House and Senate passed their omnibus budget bills proposing changes to most areas of the budget, including higher education, environment and energy, agriculture and veterans, economic development, transportation, public safety, state government, and taxes. On Tuesday evening, a conference committee got underway to resolve differences between the two bills.
We have reviewed the House and Senate proposals in more detail in earlier blogs. Overall, the House, Senate and Governor’s proposals are fairly similar. Setting the tax portion aside, the Senate proposes $208 million in savings for the FY 2010-11 biennium in its omnibus budget bill, while the House and Governor both propose $207 million in non-tax changes.
More significant differences between the Governor and the legislature appear when we look at the tax portion of the bill. The Governor proposes $258 million in net reductions, including cuts in aids to local governments and reductions in property tax credits. The House, however, proposes just $105 million in reductions in aids to local governments and the Senate includes $106 million in reductions in FY 2010-11.
Another important difference lies in the future. The Governor proposes to make his unallotment decisions permanent, reducing spending in FY 2012-13 by nearly $1.5 billion (most of this reduction comes from the cuts in aids to local governments and property tax credits). The House and Senate proposals do not adopt many of the Governor’s unallotments and include smaller cuts to local units of government and no cuts to property tax credits. As a result, the House bill reduces the state’s future deficit by $467 million and the Senate bill by $506 million.
Tom Hanson, Commissioner of Minnesota Management and Budget, was on hand to represent the Governor. Starting with a positive tone, Hanson said that the bill was “a product we can work with.” However, the Governor would like to understand more details about the rest of the legislature’s overall plan for resolving the state’s $1 billion deficit. Hanson also shared a few areas of concern about the House and Senate omnibus budget bills:
- After the February Forecast showed an improvement in the state’s projected budget deficit, the Governor proposed transferring $210 million to the state’s Cash Flow account. Neither the House or Senate proposals include resources to help with impending cash flow problems.
- The Governor will be looking for the House and Senate to agree to larger cuts to aids for local governments, particularly since these cuts play a major role in reducing the deficit in the FY 2012-13 biennium.
- The Governor is concerned about the $15 million that the House transfers from Assigned Risk Plan (which helps businesses obtain workers’ compensation coverage) and a securities registration fee that would raise $25 million.
- Hanson also reiterated the Governor’s desire to protect core public safety and corrections programs.
The conference committee is using Wednesday to allow leadership to work on targets and to have committee chairs in the House and Senate discuss the differences in their budget area. The conference committee is planning to meet again on Thursday and hopes to complete their work by Friday. The goal is to have the omnibus bill passed off the House and Senate floor by next Monday before the legislature leaves for the Easter/Passover break.
Here are some resources to help you stay on top of things.
Members of the conference committee:
- Senate: Sens. Cohen, Bakk, Higgins, Murphy and Vickerman.
- House: Reps. Carlson, Lenczewski, Paymar, Solberg and Garofalo.
Some of the information passed out at last night’s hearing is available online:
- You can download the side-by-side comparisons for each area of the omnibus budget bill. A side-by-side lines up the actual bill language from the House and Senate versions so legislators can see how the two bills differ (and where they agree).
- Only a few of the spreadsheets are available so far - an overview of all areas and spreadsheets for environment and energy, agriculture and veterans, and the tax section. Keep checking the Senate website to see if additional spreadsheets are posted (scroll through the list of spreadsheets and look for ones that were issued on March 24 or later).
-Christina Wessel
