The state’s top tax collector is warning that spending cuts in House and Senate budget bills could result in long delays in processing tax returns and refunds.
Minnesota Department of Revenue Commissioner Cynthia Bauerly told reporters Tuesday that the tax-filing season is going well, with 88 percent of the 2 million filed returns processed, and another 900,000 returns expected in the coming days.
But Bauerly is concerned about next year. She said the Republican-backed bills to fund state government operations over the next two years would result in deep cuts and the loss of about 200 employees.
“We are already stretched incredibly thin,” Bauerly said. “If we have 200 fewer people at the department and we don’t have the resources to continue to leverage technology to process these refunds, it’s going to take months.”
Bauerly said the proposed reductions would come at a time when taxpayers are asking the department for more services. She said the $20.8 million increase in Gov. Mark Dayton’s budget proposal is needed to simply maintain the current level of service.
Bauerly said the prospect of a tax cut bill passing this session would compound the problem.
“If they add additional provisions and new programs, that will make the tax code even more complex and will require more resources,” she said.
Bauerly also raised concerns about an unfunded mandate in the House state government bill to develop a free online filing system. She said the department would need to spend an estimated $20 million on the project.
Rep. Sarah Anderson, R-Plymouth, said she believes Bauerly has the capability within her existing budget to tackle the project.
Anderson, the chair of the House state government finance committee, is trying to slow the growth of all agencies. She has specific issues with the Department of Revenue.
Anderson said Revenue’s budget has increased significantly in recent years. Anderson said Bauerly’s claim that she needs another big increase is alarming.
“This is a major concern for me that there seems to be some mismanagement going on if they need an additional $20 million just to keep things at status quo,” Anderson said.