BUDGET BITES: First budget-cutting bill headed to House and Senate floors

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[Editor’s note: In an effort to help inform our members about state budget issues, Minnesota Environmental Partnership is working with the Minnesota Budget Project to cross-post updates about the budget.]

By Christina Wessel, Minnesota Budget Project

The Legislature is moving quickly to pass a “phase one” budget bill that would cut higher education, funding to cities and counties, and other services by up to $1 billion. As we noted when the plan was introduced, this bill is the first part of what appears to be a cuts-only approach by the legislature to the state’s $6.2 billion revenue shortfall.

The proposal was first introduced last Tuesday and has already moved through the committee process in both chambers. It is likely to be on the House floor for a final vote by this Thursday. The rapid action has come at the expense of an informed debate and an engaged public.

First, let’s look at what is in the bills moving to the House (HF 130) and Senate (SF 60) floor.

Additional cuts in 2011. The legislation directs Minnesota Management & Budget (MMB) to make cuts to state agencies in the current fiscal year, FY 2011, which ends on June 30, 2011. The House bill requires close to $200 million in unspecified reductions, while the Senate bill sets a target of $125 million. (The November Forecast projects a $399 million surplus in the FY 2010-11 biennium.)

The legislation lacks specifics about where these cuts would be made. To help identify the potential pool for cuts, MMB has submitted a list of all the unspent funds in state agency budgets – just under $195 million. These are funds that are likely to have an intended purpose – but have not yet been spent. The list includes resources for the State Soldiers Assistance Program, the State Grant Program for higher education financial aid, flood and tornado disaster relief funds, prison facilities and so on. The Senate bill prohibits MMB from cutting funds in some of these areas, reducing the list of eligible unspent balances to $110 million. The legislation does not specify where the $125 to $200 million in cuts will be made, although concerns were raised that money for food for prisoners, seasonal employees at the Department of Revenue, and preparing state parks for the summer season may be vulnerable.

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Minnesota Budget Bites is a blog for the Minnesota Budget Project, an initiative of MEP member group, Minnesota Council of Nonprofits.

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