Before we adjourned on Monday, the 2009 Legislative Session sent Governor Pawlenty another balanced budget. The bill was the result of painstaking work, significant compromise and months of public input. If the governor signs the bill, the $6.4 billion
budget shortfall will be addressed. The details are as follows:
nearly $2 billion in budget cuts
$1.8 billion in federal recovery funds
Delaying $1.8 billion in school payments (shift)
Raising $1 billion in new, ongoing revenue with:
Tax on credit card companies that charge excessive interest
5-cent tax on liquor, and 3-cent tax on beer
A new income tax bracket for those making $250,000 and above
Tax compliance
The bill also includes business tax credits for capital equipment, and
an Angel Investment tax credit for high-tech entrepreneurs.
If Governor Pawlenty does not sign the bill into law, he has indicated he will begin the unallotment process starting July 1. Unallotment is a rarely used tool meant only for times of emergency when the state is facing an unanticipated deficit. The process has only been used 4 times in the state’s history – twice by Governor Pawlenty.
If unallotment is used to balance the remaining $2.7 billion budget gap, the governor would be forced to make additional deep cuts to hospitals, nursing homes, schools, higher education, and other areas of the state budget. That will result in 1) reduced services for the elderly, disabled, and students; 2) more jobs lost; and 3) increased property taxes.
Please contact Governor Pawlenty and ask him to sign the fair and balanced budget by phone (651) 296-3391 or e-mail tim.pawlenty@state.mn.us.
You can track which bills have been signed or vetoed on Governor
Pawlenty’s website.
As always, feel free to contact me with your questions and concerns.