Gov. Pawlenty said he wants to balance the budget by cutting spending and not raising taxes. But, there's one area the governor won't cut. He actually wants to add money to the $14 billion K-12 education budget in fiscal years 2010 and 2011.
Pawlenty said the revised budget he submits in a few weeks will be similar to the one he proposed in January.
"In general, the budget outline that you saw earlier will remain the budget outline," Pawlenty said. "There will be some changing around in health and human services. There will be some changing around in education. Those will be the two biggest ticket items.
"There will be some other minor or more miscellaneous items that change as well, but those are the two big areas."
Pawlenty declined to specify what those changes would be. His first budget plan used spending cuts, one-time money and accounting shifts to erase the deficit.
DFL Senate Majority Leader Larry Pogemiller is one of several Democrats to say everything should be on the table to balance the budget. The budget hole, they say, accounts for more than 10 percent of the state's $37 billion, two-year budget. Pogemiller said balancing the budget has to include cuts in education funding.
"As was just pointed out, the actual budget balancing that we have to do has become harder over the long term, and you simply can't leave 40 percent of your budget off the table," Pogemiller said. That's just not possible."
Funding for public schools is mandated by the state Constitution and is the most popular part of the budget. Few lawmakers are willing to propose cutting it for fear of angering voters.
But Rep. Mindy Greiling, a DFLer, said that's exactly what Sen. Pogemiller is trying to do.
"I think the Senate is more supportive [of] education than they're letting on at this point," Greiling said.
Greiling, who chairs the House K-12 Education Finance Committee, said she thinks Pogemiller is trying to convince Minnesotans that school funding will be jeopardized unless the state can find new sources of revenue.
"So if you want to rile up Minnesotans, what do we value most? We value education," she said. "It's the thing that Minnesotans are most apt to support, a tax increase for is education funding."
Greiling, who called for an income tax increase for wealthier Minnesotans last year, said House Democrats agreed to hold off talk about any tax increases until the revenue forecast was released.
Taxes may become the real debate in the Legislature as the 2009 legislative session inches toward a conclusion.
A tax hike may not get too far with Gov. Pawlenty, who repeated his opposition to tax increases on Tuesday. He said the state's economy can't afford it.
"The last thing that the people of Minnesota need -- people who are small business people, business people across the state who are trying to save or keep jobs -- is a tax increase in this state," Pawlenty said. "This state is already too uncompetitive. It's not competitive enough when it comes to investment and job growth."
But some argue that a tax increase is needed. Eliot Seide, with the American Federation of State, County and Municipal Employees, said raising the taxes of the highest earning Minnesotans should be an option.
"I don't think it's unfair, given the magnitude of this crisis, to ask folks making over a quarter million dollars a year to simply pay their fair share," Seide said. "The same average as every Minnesotan pays. If we did that, we'd raise $1 billion in this state."
DFL legislative leaders won't say whether they plan to include a tax increase in their budget proposal. In fact, it isn't certain when they'll release their plan. The constitutional deadline for the Legislature to finish its work is May 18.