The timing of the meeting was not lost on anyone. With less than two weeks left in the 2016 Legislative session and no agreement between Minnesota lawmakers on major budget matters, rank-and-file legislators sat down and listened to experts talk about how other states craft their budgets.
Jim Knoblach, the Republican chair of the House’s lead finance committee, addressed the issue right at the start, noting that the timing had more to do with scheduling conflicts than trying to send a not-so-subtle message to the state’s top political leaders, who are only now starting to negotiate a final budget deal.
“I just think that learning about how other states set their budget targets is a worthwhile discussion,” he said.
A better way to budget has been a big theme in St. Paul this year, after the 2015 session ended in a rush of last minute, closed-door deal making. When Gov. Mark Dayton vetoed several budget bills for provisions that were included in those final days and hours, lawmakers had to come back to St. Paul for a one-day special session.
This year, members from both parties have already suggested new ways to avoid repeating the harried process, like requiring major budget bills to be ready for a vote seven days before adjournment and more public hearings before final passage.
“Last year was the least transparent of anything that I’ve ever seen,” Rep. Phyllis Kahn, a Democrat from Minneapolis who has served more than 40 years, said.
Utah (yes, Utah) as a model?
During the joint hearing of the House and Senate’s chief finance committees Tuesday, the focus was on how other states manage to put their budgets together — and if there are lessons to be learned for Minnesota.
The most striking example — offered up by experts from the National Conference of State Legislatures (NCSL), a non-governmental group that studies state governing bodies — was that of Utah, which requires state legislators to agree on about 95 percent of the state’s annual budget within the first 15 days of session. What’s more, every single member of the House and Senate in Utah plays some role in the joint finance committee that approves most of the budget.
That’s a big contrast from Minnesota, where lawmakers in the House and Senate tend to spend three months holding hearings before they agree to a broad budget outline. Then they have to come together in so-called conference committees to work out the differences between the two chambers’ bills. Though Minnesota’s system is similar to the federal government’s, some states barely use conference committees at all, the NCSL experts said, because they take too much time.
Without the House and Senate joint-budgeting process early on, “other states said it would be fairly difficult for them to imagine getting it done in the efficient matter,” said Arturo Perez, fiscal affairs program director for the NCSL.
The idea of having joint House and Senate budget committees from the start was intriguing to Sen. Richard Cohen, DFL-St. Paul, chair of the Senate’s Finance Committee. In the current session, the House and Senate have each passed separate supplemental budget bills to spend the state’s $900 million budget surplus. Those bills are now waiting in conference committees for a final deal before going back to the chamber floors for another vote. Only then can they head to the governor for final approval.
“The process at times has been, at best, awkward,” Cohen said.
The Utah example isn’t perfect, however. It’s state’s legislature is far smaller that Minnesota’s, it’s Republican-dominated and meets for only 45 days a year, compared to Minnesota’s average of about 60 days a year. And while Utah’s legislators work part time, as in Minnesota, staff works year round to get enough data and research ready for what they call “March Madness,” a two-week flurry to get the budget bills passed.
Wisconsin’s drawn-out approach
On the other end of the spectrum is Minnesota’s neighbor’s to the east, Wisconsin, which has a full-time Senate and Assembly and regularly fails to pass a state budget on time.
That’s because Wisconsin’s constitution has been amended to keep major parts of state government running in the event lawmakers don’t agree on a budget by June 30, the end of the fiscal year. In Minnesota, which crafts a budget every odd-numbered year, missing the deadline sends the state into a government shutdown unless state legislators agree to keep some functions running, or a court orders it.
At times, the system in Wisconsin has kept the budget negotiations going until October or November, though legislators tend to get the budget done quicker in election years. Still, some lawmakers voiced concern that the Wisconsin system in Minnesota would just delay a final budget deal even longer.
“With more of a full-time Legislature and no hardline deadline…is there not as much pressure to get it done?” Sen. Torrey Westrom, R-Elbow Lake, asked the NCSL experts.
Kahn actually prefers the Wisconsin model and has introduced legislation in the past to keep some functions running in Minnesota in the event there’s no budget agreement in time. She argues it saves the state money instead of going through a costly shutdown. In 2011, the state had its longest government shutdown in history, lasting 21 days and costing an estimated $60 million. “It’s expensive to shut down government,” Kahn said. “Think of what we could save?”
Old traditions stick
The committee didn’t convene to vote on any new ideas, however, and previous discussions about making changes to the process have often into arguments about tradition. Specifically, this is the way things have always been done in Minnesota, and generally it’s worked.
Other states have their own traditions, and in some cases they’ve actually helped with the process, experts said. In Ohio, for instance, legislators meet at the start of session to set specific deadlines for crafting a budget. They usually meet those deadlines, because it’s how the state has always done it.
“The process is more difficult when chambers are split between parties,” said Erica MacKellar, an analyst with NCSL. “But even in those cases leaders and chairs usually follow the agreement. Tradition plays a key role in the process in other states.”
Rep. Tina Liebling, DFL-Rochester, said she attended the hearing to learn more about how Minnesota sets its budget targets. “After 12 years in the Legislature, it’s still a mystery to me how the numbers are chosen,” she said. “I’d venture to guess if I don’t understand it, the public certainly doesn’t understand it.”
Her biggest concern is that the current budget is set by two or three top leaders and tends to keep the public in the dark. Last year, top legislative leaders reached an agreement on a budget behind closed doors at the governor’s residence. The deal left lawmakers three days to pass all of the bills in non-stop hearings and floor sessions, many in the middle of the night.
“It’s interesting to think about streamlining the process, but I’m less interested in streamlining than making it more transparent,” she said. “Dictatorships, as they say, are much more efficient.”