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Gov. Dayton, GOP Legislature point fingers for unpopular compromise

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Nearly three months after reaching a budget deal to erase a $5 billion deficit and end a state government shutdown, Gov. Mark Dayton and leaders of the Republican-controlled Legislature are blaming each other for the unpopular pieces of the agreement.

Dayton wanted top earners to pay higher income taxes. Republicans wanted to hold the line on state spending. Neither side got their way. Instead, they agreed to increase spending in some budget areas by relying on additional deferred payments to schools and selling bonds based on future tobacco settlement payments.

The budget deal also included some cuts, including a repeal of the market value homestead tax credit that gave homeowners a break on their taxes. In recent weeks, Dayton has blamed Republicans ending the credit — a move that local government officials say could force them to raise property taxes, 

"They insisted on it," the governor told reporters last week. "They got it, so they're responsible for it."

Similarly, State Sen. Julianne Ortman, chairwoman of the Senate Tax Committee, blames blame Dayton for the tobacco bonds.

"It would never have been my choice to raise $640 million in this way," said Ortman, R-Chanhassen. "I think the governor has made this choice." 

Not to be outdone, House Minority Leader Paul Thissen, DFL-Minneapolis, faults Republicans, but not Dayton, for delaying more payments to school districts.

"The school shift is a Republican policy that comes from the fact that they're unwilling to ask millionaires to help out and resolve our state budget deficit," Thissen said.

The governor takes a similar line of reasoning in public appearances. During a recent speech to the Eden Prairie Chamber of Commerce, Dayton lashed at his GOP critics. He said there were several provisions in the budget that he did not agree with, but he agreed to them to reach the final compromise and end the shutdown. Dayton said Republicans should now stand up and take responsibility for the budget, warts and all.

"If you're grown up and you're responsible, you make decisions and you take the responsibility for the consequences of them, good or bad," Dayton said. "I can disagree with people and I can respect them, and again, that's democracy. But I don't have no respect for somebody who insists on having it their way, and then when it goes awry tries to blame me or anyone else. That's unacceptable." 

Shortly after that public scolding, Senate Majority Leader Amy Koch, R-Buffalo, returned fire. She likened Dayton's lecture to Republicans about budget responsibility to a lecture from convicted investor Bernie Madoff on Wall Street reform.

Koch said Dayton's budget approach was all wrong.

"In these incredibly difficult economic times, the governor was giving us the same old sort of 1970s, liberal, tax-and-spend budget," she said. "There was no reform. There were no reductions. There was no tightening of the belt for state government. There was just, 'We have a hole to fill and we're going to figure out which taxes we're going to raise to do it.' " 

Koch said she is taking responsibility for the budget compromise reached with Dayton.

Like Koch, House Speaker Kurt Zellers, R-Maple Grove, said the original Republican budget would have been better.

"We proposed a budget that didn't have a tobacco bond or a shift in it, that was, we think, a very modest increase during tough economic times," Zellers said. "But that's not the budget the governor was willing to sign. So, the product that we have at the end of the day is something that neither one of us wanted, but it's the budget that we passed and he signed into law."

Zellers downplays the recent rash of finger pointing as a symptom of divided government. 

But political observers see it differently. 

Hamline University professor David Schultz said Democrats and Republicans are trying to distance themselves from a budget that failed to fix the state's underlying financial problems and could soon unravel.

"All the projections so far are suggesting that not only in 2013 are we back to where we were in 2011, in terms of a multi-billion dollar deficit, but with the economy apparently eroding, we may very well be in a position the state of Minnesota in 2012 where additional cuts have to occur," he said.

Schultz said both sides are also preparing for the 2012 election, when all 201 Legislative seats are up for grabs. He said he expects blaming the other guys for the budget will be a common theme in those campaigns.