Advertisement
Pawlenty said he will propose trims on Thursday, when finance officials release a budget forecast.
Lawmakers and analysts are expecting a deficit of as much as $4 billion to $5 billion for the budget period starting in July. Few have focused on the current budget, which includes almost $35 billion in spending approved by the Legislature in the past two sessions.
The current budget runs through June 30, so most of the money is already spent.
“The cushion that had been built up prior to the collapse will not now be sufficient,” Pawlenty said on a conference call from Philadelphia after he and other governors met with President-elect Barack Obama. “It might have been had the decline and recession been slower.”
While Pawlenty declined to quantify the near-term deficit, he said he expects it to be “noteworthy” but not “unmanageably large.” He is betting that the economic meltdown ate through a series of projection-topping tax collections through September.
The Republican governor said he aims to work with the Democrats who control the Legislature to identify spending that can be pulled back within the next few weeks. He said he could also make cuts on his own through an executive power called unallotment.
“We can’t wait too long because as more and more time goes by, the money goes out the door and there’s pretty soon no options left to get the budget balanced,” Pawlenty said.
State law allows the governor to drain the state’s budget reserve and then delay, reduce or cancel unspent payments to cover a deficit. The reserve currently has $155 million, according to Minnesota Management and Budget, after lawmakers and Pawlenty tapped it to cover a shortfall earlier this year.
Democratic House Speaker Margaret Anderson Kelliher said Pawlenty could call a one-day special session in December so lawmakers could tackle any current budget gaps quickly. The regular session begins Jan. 6.
But she said Pawlenty’s talk of unallotment was premature.
“It’s a little like saying, ‘I want to have a friendly conversation with you,’ but bringing along a meat cleaver to the conversation,” said Kelliher, DFL-Minneapolis.
Pawlenty said he would like to have a “pretty firm understanding” on short-term cuts with legislative leaders within a few weeks and could begin the unallotment process before the month ends.
