Budget talks continue at Capitol, and both sides see progress

The news that lawmakers and Gov. Tim Pawlenty would meet over the weekend to haggle over how to solve the state’s $935 million shortfall played out further than many expected. What was billed to be an hour meeting Saturday morning turned into several hours over both days.

Still, no agreement.

Even so, there’s optimism from the governor and from DFL leadership, as Pawlenty and Assistant Senate Majority leader Tarryl Clark, DFL-St. Cloud, expressed today in separate news conferences.

“I think we’re making progress,” Pawlenty said. “We have a way to go, but progress has been made. Tone is good.”

Clark, for her part, was equally sanguine and diplomatic. “We’re getting very close now,” she said. “We hope to get an agreement.”

Still, it wasn’t clear whether the guv and DFL and GOP leadership would resume talks today. But it seems all sides are happy working something out, rather than DFLers coming up with a proposal unlikely to satisfy the governor, which has been the m.o. on other issues this legislative session, and part of what happened over the budget last year.

Two major points: The governor wants some kind of assurance that a property-tax cap will be in play, calling it his “linchpin” of the negotiations. (A current House proposal, Pawlenty said, doesn’t pass his sniff test.) And the DFL leadership wants to make sure the governor keeps his hands off a $250 million surplus in the Health Care Access Fund — or, at least, that any surplus money be used for health care purposes.

Pawlenty originally wanted to use all $250 million as part of the addressing the budget crunch, then he whittled that to $125 million, and it appears now he’s willing to go much lower than that, and also agree that it be used to “transition” some people from a medical assistance program to Minnesota Care.

“I’ll try to be respectful,” Pawlenty said, adding that there could still be some compromise on the matter because of overlap with a separate health care reform bill DFLers want.

“The governor has moved from understanding to an understanding,” is how Clark put it.

One issue that doesn’t seem to be playing into the budget negotiations is the $70 million for the Central Corridor that Pawlenty struck out of the bonding bill. The light rail debate hasn’t entered into the budget dealings, both Clark and Pawlenty indicated, but it’s not necessarily dead.

“We don’t view the bonding bill as holding up negotiations,” Pawlenty said, adding that two of his pet projects, a new state park and funding for a veterans home, had better be in any new bonding bill.

Is there time to revive the Central Corridor with another bonding bill? “Oh sure,” Clark said, smiling, “we have two weeks.”

But Clark deemed Saturday and Sunday a “productive weekend,” and added in regard to a budget deal, “If the governor wants it, he’ll get one.”

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