The optimism that lawmakers were feeling late Wednesday seemed to melt away as budget negotiations continued Thursday. Shortly before midnight, after meeting for 45 minutes in the governor's office DFL House Speaker Margaret Kelliher and DFL Senate Majority Leader Larry Pogemiller seemed less than pleased with the latest round of budget talks.
"It's 24 hours later and I feel we're in a bit of a neutral position," said Kelliher.
"I think neutral is a little strong," Pogemiller said.
Neither Pogemiller or Kelliher offered specifics on what was discussed in the meeting.
They're discussing the components of an estimated $35 billion two-year budget that funds schools, nursing homes and state colleges and universities. Gov. Pawlenty has argued throughout the legislative session that his budget proposal, which increases spending 9.5 percent over the last two-year budget, is enough. Democrats say more money is needed to fund schools and provide property tax relief. They have dropped their attempts to increase the income tax on Minnesota's top earners but want the governor to find some other source of revenue.
Pawlenty's spokesman Brian McClung said the governor is concerned about the size of the nearly $10 billion health and human services bill which funds nursing homes, subsidized health insurance and welfare programs. He said they are close to an agreement on several other budget bills including K-12 schools, economic development and higher education.
"The numbers really are not all that far apart, and so we're working on trying to work on some areas where we agree. But we also do recognize that the health and human services number is too large and as you look at that compared to the governor's recommendation, it's hundreds of millions of dollars more. So we think we need to move down in that area."
Republican House Minority Leader Marty Seifert of Marshall also said the major sticking point is the health and human services bill. But he said the governor and legislative leaders all know that they won't get everything they want this session.
"Everybody has to give something. The governor has to throw some of his spending initiatives under the bus wheel, the Democrats will have to throw some of their priorities under. I think at the end of the day, you'll see a lot of the controversial thrown away, a lot of the spending come down," he said.
Despite the vows of cooperation, there have been some bumpy spots in negotiations. Seifert said Pogemiller requested that Seifert no longer take part in the closed door negotiations. Pogemiller said the governor is dragging his feet on reaching a deal to help his Republican colleagues in the Minnesota House.
"My concern has grown that the governor is leaning toward a House Republican strategy of leaning toward a special session and I think that's unfortunate," he said.
Pawlenty's spokesman, Brian McClung said Pawlenty does not want a special session.
Things could become more heated later today if Speaker Kelliher and her caucus decide to take up the budget bills that the Senate passed earlier this week. Pawlenty has not agreed to the bills and has suggested that he would veto them if they arrive on his desk. Kelliher said she'll talk with the rest of her caucus about the action before making a decision. If they do, it could be a sign that lawmakers will be meeting beyond Monday's deadline to adjourn.