Talks pick up at Capitol, but still no budget deal in sight

Budget caucus
Gov. Mark Dayton meets with Republican leaders including Senate Deputy Majority Leader Geoff Michel, left, and Senate Majority Leader Amy Koch, before a joint House and Senate GOP caucus at the Capitol in St. Paul, Minn. on Thursday, May 19, 2011.
MPR Photo/Jeffrey Thompson

With just over three days left in session, state lawmakers were meeting more frequently Friday at the State Capitol to try to reach a budget agreement.

DFL Gov. Mark Dayton and Republican leaders said their private talks were cordial, but they're still no closer to a deal to erase a projected $5 billion state budget deficit.

House Speaker Kurt Zellers and Senate Majority Leader Amy Koch tried to get budget talks moving during a morning meeting in the governor's office. They also had a second meeting scheduled for late afternoon. The leaders asked Dayton to provide them specifics on the $1.8 billion in spending cuts that he included in his revised budget proposal. He later declined the request.

Republicans remain opposed to the other half of Dayton's plan, which would raise an equal amount in new income taxes from the state's wealthiest 2 percent. There are also a long list of smaller disagreements over policy proposals. Zellers said GOP leaders asked Dayton to clarify his position on those measures too.

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"There's a lot of stuff besides just the big giant number that has to be negotiated in there, especially from a policy standpoint," Zellers said. "But time is running out."

Other Republicans also met with the governor and his commissioners to discuss the funding bills for K-12 education and state government operations. The chairs of the state government conference committee have recently feuded with Dayton over the impact of their bill on state agencies and services.

But Rep. Morrie Lanning, R-Moorhead, emerged from the meeting sounding upbeat and optimistic.

"The governor, I think, better understands what we're trying to do, and we, I think, better [understand] his perspective on a variety of issues," Lanning said. "It's unfortunate that we didn't have this kind of meeting earlier. But be that as it may, we're now I think on the right path here."

Lanning didn't offer specifics, but Dayton later said they discussed provisions in the bill to stop tax evasion and Medicaid fraud. They also discussed potential savings from state vehicles and buildings, as well as a consolidation of information technology services.

Still, Dayton said he reminded the legislators that the big budget disagreement remains.

"I hope we can continue those kinds of meetings over the next three days, and I hope there's some breakthrough on the part of the legislative leadership to accept my proposal to meet them halfway on the budget," Dayton said. "If they don't agree, then I'm pessimistic that we will be able to conclude this by midnight on Monday."

If lawmakers miss their deadline, Dayton would have to call them back for a special session. If the impasse lingers through the end of of the fiscal year on June 30, a government shutdown would begin. Officials with the state's largest public employee union, AFSCME Council 5, have begun preparing their members for a potential shutdown. But Dayton won't go there.

"I've not had any conversations on that subject, and I don't intend to until circumstances warrant it next Tuesday," Dayton said.

The budget bills that Republicans finalized this week will soon begin landing on Dayton's desk. Most of the bills appear to headed for a veto. But Dayton said he will take time to look over every bill before acting.