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What a budget deal might look like

There are several ways Gov. Mark Dayton, Senate Majority Leader Tom Bakk and House Speaker Kurt Daudt could strike a deal and end the session.

State Rep. Jim Knoblach, Speaker Kurt Daudt and Majority Leader Joyce Peppin speaking to the press on Tuesday on the grounds of the governor's residence.
MinnPost photo by Briana Bierschbach

As we consider the current stare down in state government, it seems like an appropriate time to remember a little story about compromise.

Back in his first term, U.S. Sen. Paul Wellstone was caught in a bind over a question affecting the Boundary Waters Canoe Area (BWCA). At issue was whether some lakes in the BWCA should be opened to motorized boats. Wellstone was, as they say, trying to paddle on both sides of a canoe: His metro base of environmentalists were pushing him to keep the area pristine, while his northeastern Minnesota backers were advocating opening up the BWCA.

In the middle of all this, one of Wellstone’s friends, Frank Hornstein, now a DFL state representative from Minneapolis, ran into Ted Mondale, who’s been around politics his entire life, at a local grocery store.

“What should Paul do?’’ the troubled Hornstein asked Mondale.

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Mondale responded without hesitation: “Give ’em a lake.’’ 

Goodbye gas tax?

In the current negotiations among Gov. Mark Dayton, Senate Majority Leader Tom Bakk and House Speaker Kurt Daudt, there have to be some metaphorical lakes to give up in order for the Legislature to finish up its business.

In conversations with legislators, former legislators, lobbyists and just about anyone else hanging out in the Capitol Tuesday, most people talked a lot about “lines in the sand.” But they also mentioned a variety of ways that this session could end with a deal.

Republicans, who control the House, are not going to give up their opposition to a gasoline tax that DFLers want to use to fund an expansive transportation bill. DFLers, on the other hand, are not going to give up their opposition to the GOP’s proposal to cut health and human services spending by $1 billion and phase out Minnesota Care, the subsidized health care program for the poor.

Before the sun sets on this session, then, watch for DFLers to reluctantly give up on the gas tax, and with it, their big plan for a comprehensive transportation bill. That doesn’t mean DFLers will accept the Republican transportation plan, which is essentially held together with duct tape, twist ties and promises. Instead, look for the parties to end up with a transportation bill that includes some motor vehicle fees (which currently end up in the general fund) and, perhaps, a bundle of bonding money.

This would be the lake the Republicans would get this session. It would allow them to go home and say, “Look, we stopped the gas tax!’’ According to polls, that would play well with the majority of Minnesotans — at least for the time being. 

Hello bonding bill?

A concession by the DFL on the gas tax would also be the key piece in solving most other issues. Recall, for example, that House Republicans all but put up a flashing neon sign in the chamber saying “NO BONDING’’ this session. Dayton responded to this by proposing a massive $842 million dollar bonding bill. If the gas tax goes away, however, look for Republicans to accept bonding money for transportation projects. Dayton, after all, loves bonding bills, which he considers jobs bills. 

More important, relenting on the gas tax would put Dayton and Bakk in a position to force Daudt and the Republicans to back off their plan for tax cuts, cuts which — as currently constituted — would primarily benefit businesses.

DFLers will be willing to provide some small income tax breaks for the middle class, but expect any deal to gut the GOP’s hopes of delivering for business. Such a move would also provide the not-insignificant benefit of giving DFLers some campaign rhetoric, i.e. “We stopped the Republicans from giving breaks to rich corporations at the expense of the middle class.” (If nothing else, everybody has to come away from the session with some campaign rhetoric.)

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Status quo likely on MinnesotaCare

When it comes to funding health and human services programs, DFLers will probably win more than they lose. House Republicans want to slash funding by $1 billion and phase out MinnesotaCare, the subsidized health care service for the poorest in the state — even while the Senate and the governor are calling for a $300 million increase in health and human service spending. Despite GOP claims that such spending is not sustainable, the end result here is likely to be a relatively small increase in funding and the status quo on policy. 

But, like transportation issues, human service spending issues are always going to be with us. In this case, both Republicans and DFLers will end up kicking any problems — as with transportation issues — down the road. Both issues prove once again that the Legislature is a place where big ideas go to die.

Everybody will claim victory on education …

Education funding will end up with both sides claiming victories. The governor and Senate will get a bigger per-pupil funding increase for K-12 education than Republicans want. (Republicans want to raise the funding formula by 1.2 percent; Dayton and the Senate are pushing for 2 percent.) Look for the sides to settle at 1.5 percent, which still may not be enough to prevent larger class sizes and staff cutbacks.

But this DFL win is likely to come at a loss for the governor. From the beginning of the session, he’s claimed that funding for universal preschool is a top priority (though, to be fair, throughout the session the governor has proclaimed a number of issues as his “top priority”). Not only is he not going to get the whole $343-million loaf for his pre-K plan, he’s barely going to get crumbs. What Republicans might give Dayton are a few million dollars to expand the state’s already existing scholarship program for at-risk preschoolers.

… And nobody will be happy with the final budget number

There will be other gives and takes in the session. There could be a tiny phase-in of those streams, rivers and lakes buffers that Dayton says are “a priority.’’ There also will be vows to do a better job of enforcing laws already on the books regarding pollutants and the state’s waterways. 

Almost certainly there will be some blue-ribbon commissions and panels and task forces formed to study a variety of other issues. (A former legislator, laughing, said that “blue ribbon panels are the most prestigious, much more important than task forces.’’ )

And after all the trades are made, a budget deal finally can be reached. It’s likely to be less than the $42 billion the governor wants, a little less than the $41.5 billion the Senate wants — but certainly more than the $39.9 billion the Republicans want. Nobody will be happy, but everybody will be able to head to the lake of their choice.

Then most of us will muddle on, unaware of how much was — or wasn’t — accomplished.