Jan 22, 2009 4:55 pm US/Central
Pawlenty: No New Taxes, Few Fee Hikes In Budget
ST. PAUL (AP) ―
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Gov. Tim Pawlenty previewed the budget he will unveil Tuesday to erase a projected $4.8 billion deficit. (File)
CBS
Gov. Tim Pawlenty said Thursday the budget he will unveil next week contains no tax increases and little in the way of fee hikes.
The GOP governor said he will erase a projected $4.8 billion deficit through a package of cuts, accounting shifts such as changes in payment schedules and an "all-time historic low" in fee increases. He previewed the budget to reporters in his Capitol office, saying the bad economy calls for dramatic change.
"You'll see a budget on Tuesday that is aggressive and takes on some risk in exchange for trying to strategically reposition Minnesota to try to be more competitive and to try to maintain as many of the commitments to our priorities as possible," he said.
As for tax increases, he said, "We're able to balance the budget without them."
Pawlenty's budget gives the Democrats who control the Legislature a starting point for the next four months of deliberations at the Capitol. They have promised to hold hearings around the state on his proposals, and eventually will release their own blueprint for balancing the budget through mid-2011.
State leaders expect a federal stimulus package to help, but aren't sure yet how much of a dent it will make. As DFL House Speaker Margaret Anderson Kelliher was in Washington meeting with members of Minnesota's congressional delegation, an estimate posted by the National Conference of State Legislatures showed more than $3 billion in aid to the state, including $1 billion directly tagged for the budget shortfall.
Pawlenty said he expects significant help from the federal government but didn't quantify it.
He warned that the budget hole will probably get deeper -- and a short-term deficit is likely to reappear in the current budget that runs through June -- when finance officials update their forecast in early March.
Meanwhile, House and Senate Republicans called for a 5-year business tax holiday for companies that create jobs by expanding or relocating to the state. Pawlenty said he supports the concept but doesn't want to create unequal tax treatment between competing businesses. He said the focus on jobs is critical.
"Minnesota is not well-positioned in a hypercompetitive global business and job battle to succeed in the future unless we start changing our job and business climate," he said. "That's really tough to do when you have a deficit, but you have to start."
(© 2009 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)
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