In the first round of budget negotiations with lawmakers, Gov. Tim Pawlenty offered to use less of a health care fund that Democrats want to protect for health care policy changes.
The Republican governor made the opening offer Monday in talks to fix the state's $935 million deficit.
He proposed taking $125 million from a dedicated health care account tied to the MinnesotaCare program for the working poor, down from his original proposal of $250 million.
His offer would also include unspecified budget cuts totaling $125 million.
Assistant Senate Majority Leader Tarryl Clark, DFL-St. Cloud, said Pawlenty's offer was a beginning. But she says Democrats still don't want to use the health care fund as part of a budget-balancing solution.
"He's got a ways to go, but he made a step forward," said Clark.
Clark said a counteroffer from legislative Democrats would come soon.