Republican gubernatorial candidate Tom Emmer is betting his campaign on whether Minnesotans will accept a state budget for the next two years that cuts spending on higher education, aid to cities and counties and state agencies.
His plan would also slash projected growth in spending on health and human services programs, and continue a spending delay for Minnesota schools. Emmer laid out the broad strokes of his budget Tuesday, on the same day that DFLer Mark Dayton acknowledged his plan to raise taxes on the state's highest earners doesn't raise as much money as he thought.
Emmer said the state has to live with as much money as it is due to collect over the next two years -- and no more. He laid out broad targets for where he would spend that $33 billion, but said the details of which programs would be cut and how they would be cut will have to be worked out with the Legislature next year.
Some of what Emmer proposes are real cuts. Higher education, for example would get about $300 million less in the next biennium than it gets now. Aids and credits to local governments would see an actual cut of $681 million, and state agencies would see a cut of about $550 million.
But Emmer finds big money in slowing the projected growth in spending. Specifically in the area of health and human services, which is projected to grow by nearly $3 billion in the next biennium, Emmer's plan allows for growth of only $667 million.
Emmer would not say whether that limited growth means fewer people would be eligible for state health programs, or whether they would see lower benefits.
"We have set the most aggressive budget targets. We have also told you that one of our priorities is that we work with both parties," said Emmer. "You have the legislative bodies, and we're not going to tell them that their ideas are not welcome here. But you must live within your means. In this case, we have shown you that this is what can be done and will be done if we're in the office."
Emmer announced earlier that his budget plan would hold the line on spending for K-12 schools, and that he would not begin to fix a delay in state spending for schools until 2014.
Gov. Pawlenty and the Legislature used the delay to balance the budget earlier this year. It has required some school districts to borrow money to meet expenses.
While Emmer gave only broad numbers of his proposal, he said he was still being more specific than his major party opponents, Democrat Mark Dayton and Tom Horner of the Independence Party. Both Dayton and Horner have proposed raising taxes. Emmer's plan includes a tax cut of more than $600 million for businesses.
"Sen. Dayton and Tom Horner have announced their budget priority -- preserving the status quo in government," Emmer said. "They are both members of the political class, who think raising taxes on hard-pressed Minnesotans is better than asking government to become more efficient."
Emmer's budget announcement came on the same day that Mark Dayton acknowledged his own plan to raise income taxes on Minnesota's top earners doesn't produce as much money as he expected.
The state Revenue Department analyzed Dayton's tax proposal, and said it would generate nearly $1.9 billion over the next two years. Dayton had claimed the income tax hike, along with a variety of other tax increases, would produce double that amount. Dayton has pledged much of the money to increased funding for K-12 schools, including paying back the delayed funding.
A campaign official said the analysis shows the need for Dayton to continue looking for other revenue sources and spending cuts. Dayton was unavailable to comment, but a campaign spokeswoman said Emmer's plan would result in higher property taxes and college tuition, and that his reduction in health and human services would restrict access to essential health care for those most in need.
The Independence Party's Tom Horner said Emmer's plan sets the wrong priorities. He said it appears to be based on the faulty assumption that charities would pay for health care services the state currently funds, and the plan is not politically viable.
"I don't think it's the kind of plan that would draw votes in a Legislature from anyone other than the most partisan conservative ideologues," Horner said.
Horner has proposed extending the sales tax to clothing and unspecified personal services while lowering the overall sales tax rate. Horner said his budget plan would raise taxes by more than $2 billion and cut spending by more a bit more than that. Like Emmer, he would delay fixing the school funding shift.