GOP budget plan upsets state auditor

A 12 percent budget cut dramatically would reduce information Minnesota taxpayers receive about local government finances, the state auditor said Tuesday in reaction to a House Republican finance bill.

“In an economic downturn, there is a greater need for oversight, not less,” Auditor Rebecca Otto said as she outlined plans to drop many parts of her service if the bill passes.

Chairman Morrie Lanning of the House State Government Finance Committee said Otto was exaggerating in testimony before his committee.

“You are certainly trying to paint a very dire picture,” the Moorhead Republican told her. “But the reality is you still have $16 million in the budget.”

Lanning’s bill would cut $2.3 million from Otto’s budget, leaving her with slightly more money than when she took office four years ago.

Tuesday’s debate was much like others throughout the state Capitol and State Office Building this week as legislative finance committees face a Friday deadline.

Republicans who control the House and Senate have offered a $34 billion two-year budget plan, up from the current $30 billion budget but below Democrat Gov. Mark Dayton’s $37 billion proposal.

Dayton mixes a tax increase on the richest 5 percent of Minnesotans with spending cuts as he tries to plug a $5 billion budget deficit. Republicans, however, refuse to raise taxes and make deeper cuts to accommodate increased spending in areas such as health care.

Freshmen Republicans, in particular, say they were went to the Legislature to cut government, and the Lanning government finance bill is where many of those cuts come.

Rep. Nora Slawik, DFL-Maplewood, complained that state government cuts are too drastic to do in one budget.

“This is not a normal time,” Lanning shot back. “Our spending is unsustainable.”

Lanning pointed out that revenues, mostly from taxes, are expected to rise 3.9 percent each of the next 25 years, but health-care spending alone will rise 8.5 percent if nothing is done.

Added Rep. Keith Downey, R-Edina, author of many state government-cutting bills: “This is the Legislature that has to say, ‘No more.’ We cannot keep pouring money into the status quo.”

The major cuts especially irk public employee unions, whose negotiating rights could be removed. Some say that could fire them up enough to help Democrats regain legislative control in next year’s elections.

“You are setting the stage for a fight, and I am OK with that because you are energizing our base,” said Rep. Kerry Gauthier, DFL-Duluth.

Otto has become the most vocal critic of proposed GOP cuts.

“Legislators, you are not going to have data on local government any more,” she declared.

Rep. Mike Benson, R-Rochester, told Otto that “you still have 86 percent left,” but Otto said taxpayers will be hurt when she no longer can audit local governments’ finances.

“There is nothing left,” Otto said. “I was answering the phones at the front desk yesterday. … Right now we are bare bones.”

The Lanning bill contains several provisions to limit worker pay increases and to cut government.

“This bill will result in layoffs and a salary freeze,” said Richard Lolodziejski of the Minnesota Association of Professional Employees, the state’s second largest public worker union.

The House state government bill also:

  • Requires a 12 percent reduction in the state workforce by 2013 and immediate hiring and pay freezes.
  • Sets up a pilot program to study whether it is feasible to pay state workers based on performance.
  • Appropriates $322,000 to reimburse counties for costs incurred in the 2010 governor’s race recount.
  • Cuts executive agency spending nearly $95 million.
  • Transfers $200,000 from the Fergus Falls Veterans’ Home addition to the Minneapolis Veterans’ Home.
  • Establishes a commission to review whether state agencies should continue to exist.
  • Limits number of state agencies’ appointed officials.

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