Gov. Pawlenty and DFL leaders have been butting heads for weeks over proposed tax increases and spending cuts. The Republican governor opposes tax increases, and Democrats oppose Pawlenty's plan to borrow nearly $1 billion against future state revenue.
But now, the governor says he's willing to reduce that borrowing by half. In a letter to House and Senate leaders, Pawlenty said he was trying to help facilitate a budget agreement.
Pawlenty also said he would reluctantly agree with the Senate's position to not provide funding for the state's budget reserve. The governor had wanted $250 million. He also accepted the House position on delayed payments to school districts. Pawlenty's spokesman, Brian McClung, said the three proposals would generate $1 billion in revenue, which is the same amount contained in a tax bill the governor vetoed early Saturday morning.
"The governor is offering this in part to help kick start the discussion during this final week of the session," McClung said. "And we hope Democrats will come back in the spirit of compromise and make an offer of their own and try to find a way to resolve some of these issues."
"It doesn't help balance the budget."
Democrats are not embracing the proposal. DFL House Majority Leader Tony Sertich of Chisholm said the governor's offer is a compromise in word but not in deed.
"It doesn't help balance the budget," Sertich said. "When you're talking about reserves and more use of one-time money, that doesn't help us in the long term."
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The assistant majority leader in the Senate, DFLer Tarryl Clark of St. Cloud, also dismissed the proposal. Clark said the governor is moving an inch, when the House and Senate have already moved a mile.
"He's not offering anything new here," Clark said. "He's just moving around some ideas that aren't very good. If the Senate had its way, we would do none of those three things."
House Republican Minority Leader Marty Seifert of Marshall credited the governor for looking at options for bringing the sides closer. Seifert said a partial pullback of the borrowing plan could make the concept more palatable.
"We have to see which parts are acceptable and go with the flow in terms of how to bring a successful conclusion to session right now," Seifert said. "It looks like both sides are going to have to give a little on something."
House and Senate Democrats say they plan to pass all the remaining budget bills and send them to Gov. Pawlenty by midweek. It's unclear how many he'll actually sign into law, and whether there will be enough time left for a second try on vetoed bills.
Meanwhile, the Senate is advancing a bill to fund government services at base levels through June 30, 2010. DFL leaders describe the measure as "precautionary."