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• May 11, 2008 11:19 pm US/Central
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  Gov.: Property Tax Cap Key To Budget Deal

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Gov.: Property Tax Cap Key To Budget Deal

Gov. Tim Pawlenty held more budget negotiations with legislative leaders Sunday, saying getting a property tax cap that would reduce projected increases by at least $100 million a year remains the key to an overall agreement.

And he threatened to oppose the Central Corridor light rail project and other priorities of Democrats without a deal.

Talks between the GOP governor and the DFL legislative leaders began at 5:15 p.m. and recessed before 7 p.m. so that Revenue Commissioner Ward Einess could meet with the legislative tax committee chairs on the cap issue, Pawlenty spokesman Alex Carey said.

Late Sunday night, the governor sent a letter to Senate Majority Leader Larry Pogemiller and House Speaker Margaret Anderson Kelliher insisting on a cap.

"As I have mentioned many times, agreement regarding a property tax cap that will reduce projected property tax levy increases by at least $100 million per year is key to an overall agreement," Pawlenty wrote. "You have been unable or unwilling to agree to such a cap."

Pawlenty said he wanted a commitment on the cap before negotiating other major elements of a budget deal. He said those elements included a resolution of an anticipated $935 million budget deficit for the 2008-09 budget period and "meaningful progress" toward addressing the potential deficit for 2010-11.

Absent an agreement on the projected deficit, Pawlenty wrote, "I will enforce my position that we cannot afford projects like Central Corridor and expansions of publicly subsidized social service programs under such circumstances."

A littler earlier in the night, Kelliher and Pogemiller wrote to Pawlenty saying they had made "numerous attempts" to try to accommodate his concerns.

They wrote that they believed progress had been made and that they were "relatively close" to agreement, but needed additional information from him, including his prioritized lists of spending initiatives and budget items he considered objectionable, as well as data on the impacts on cities and counties of the levy limit scenarios they had been discussing.

(© 2008 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)