The Minnesota Senate Wednesday passed a government finance bill that dramatically cuts the state workforce, freezes salaries and slices the operating budgets of all state agencies.
Republicans say the changes are needed to make state government more efficient and help erase a projected $5 billion budget deficit. But Democrats argue the proposed cuts are too deep and rely too much on financial guesswork.
TIME TO TIGHTEN THE BELT, REPUBLICANS SAY
Since the beginning of the 2011 session, Republican leaders have been adamant that state government has to do the same kind of belt-tightening that businesses must do in tough economic times. Sen. Mike Parry, R-Waseca, the chair of the Senate State Government Innovation and Veterans Committee, said families are also making sacrifices.
"I have constituents that have gotten rid of their cable TV, that have downsized in the vehicles they have, because we're all survivors," Parry said. "I would hope that we could say our state government is taking the lead from our families out there that have had to do the same thing."
Parry's bill reduces projected spending in state government operations by 59 percent. It reduces the state workforce by 15 percent over the next four years and freezes the wages of remaining workers for two years. There would be across-the-board cuts of 15 percent for all constitutional officers and state agencies.
During the floor debate, Sen. John Carlson, R-Bemidji, defended another cost-cutting provision that would move all employees, including legislators, into a new health insurance plan with high deductibles and health saving accounts.
"This is a huge benefit," Carlson said. "For those unions that have been sending out misinformation emails to their members, I ask you to cease and desist."
But Democrats argued that the health care switch is a bad deal for state employees, who would have to pay more for insurance. Sen. David Tomassoni, DFL-Chisholm, said state workers have already agreed to salary freezes. He called the bill a "ruthless attack on public employees."
"My friends on the other side of the aisle seem to think that a person making $38,000 can afford to contribute over $12,000 of his wages and benefits to help settle the state budget, yet a multi-millionaire should not have to pay one extra dollar," Tomassoni said.
SAVINGS INFLATED, DFL CHARGES
Democrats also accused Republicans of ignoring nonpartisan fiscal notes and inflating potential savings to make the numbers in their bill balance. Sen. Dick Cohen, DFL-St. Paul, accused GOP leaders of inventing money.
"The rhetoric we have heard over and over again is 'We can cut budgets. We have the ability to cut budgets. We have the ability to do this without tax increases.' This gives the lie to that. You can't do it," Cohen said.
But Republicans have said that state finance officials in some cases could not grasp the government innovation they're pushing forward. Instead, they say they've been relying on information from private companies and other states.
Sen. Sean Nienow, R-Cambridge, argued that some risk is appropriate to make needed changes in state government.
"We need to look at our government and have a dream of innovation," Nienow said. "And ask 'What can we do different that the old paradigm said was not possible?'"
The commissioners of three state departments: Administration, Management and Budget, Enterprise Technology and Revenue, sent letters to Senate GOP leaders to share their concerns about the bill. They warned that the cuts would reduce many core services.
Gov. Mark Dayton is proposing significantly smaller cuts in state government, but he weighed in with a mostly optimistic assessment about the budget process underway this week.
""I put my budget forward, it balances," he said. "Now they're going through the process of enacting their budget. The House will pass its. The Senate will pass its, then it will go to conference committee, they'll pass conference reports. At that point we'll have a legislative budget by the majority voted, and I'll have by budget and we'll begin the negotiations."
Dayton said he's still optimistic about reaching a budget agreement with Republican leaders by the Legislature's scheduled adjournment of May 23.