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Legislature: Pawlenty vetoes legislative tax bill

Gov. Tim Pawlenty, who vetoed the Legislature's tax bill at 3 a.m. before taking to White Bear Lake for the Governor's Fishing Opener Saturday, is surrounded by Twin Cities media wanting to talk fish and taxes. Pioneer Photo/Brad Swenson

WHITE BEAR LAKE, Minn. - Gov. Tim Pawlenty, in the wee hours Saturday morning, didn't waste time in vetoing a legislative tax bill that would raise taxes $1 billion.

Vetoing the bill at 3 a.m. at the Capitol, a half hour before taking to White Bear Lake for the Governor's Fishing Opener, the Republican governor said the veto was "like plucking leeches from the taxpayers."

The veto sets up a confrontation over whether the Legislature will get its work done by its constitutional deadline of next Monday. As yet, Pawlenty said Saturday he has no plans yet to call a special session should the deadline come and go.

"We'll get to that fork in the road when we get to it," Pawlenty said to a gaggle of reporters that included both those following the Governor's Fishing Opener and his reaction to the omnibus tax bill. "There's a lot of time left and a lot of issues to resolve between now and then."

Good progress has been made, he said, with signing of bills for the environment and natural resources and transportation bill.

"We're very close if they want to finish up a public safety bill," he said. "There's certainly enough time to do it; everybody would like to get it (all bills) done on time."

Pawlenty said there's "no excuse for the DFL-controlled Legislature being there from January until May and then say they ran out of time because they only have three or four days left. They should have been using their time better in March and April."

He noted the DFL-controlled Legislature set its own timetable and then didn't meet it. "they pushed it to the last minute."

The Legislature late Friday night passed a tax bill raising $1 billion for schools and nursing homes, with revenues most probably coming from increased income taxes.

Pawlenty, who has steadfastly refused income tax hikes, said he'd prefer the lawmakers to send up separate bills and not connect program spending to obvious tax hikes.

"Instead of these big omnibus bills, it's always better to have different categories so you can deal with one thing at a time," he said. "That bill also cut K-12 education, by my calculations, substantially. So not only do they raise taxes, which sends Minnesota in the wrong direction, they also cut our school funding, and we didn't like that either."

He theorized the DFL needed to pass such a bill for its stakeholders, but "it's disappointing that they cut schools too."

Pawlenty's budget has proposed $1 billion in bonding, to be paid back by tobacco settlement monies. DFLers, however, charge that it would cost $600 million in interest payments.

With nearly a $5 billion deficit, Pawlenty said his proposal only makes up for $1 billion. "If you want to find $1 billion in another way as a compromise ... the tax cuts I've proposed are a quarter of a billion. The House DFL proposes a K-12 shift of $800 million beyond me, so there's a billion right there. Those two components right there would be a compromise that would more than make up for the tobacco money."

Legislative leaders for schools and human services plan a telephone news conference Monday morning with greater Minnesota reporters. Included will be a discussion of the impact of cuts under Pawlenty to rural hospitals and nursing homes.

"Publicly subsidized health care in Minnesota and welfare and social service are really important but they're growing so fast," Pawlenty said in an interview. "It's suffocating our ability to do other things. Hardly anything is growing as high in the budget except that one category - it's growing 20-plus percent this budget cycle. You can't have one category growing so fast, even if it is important, that it strips your ability to fund other important things like K-12 education, colleges and schools, economic development and jobs, and the like."

Minnesota has the danger of becoming "one big social service, welfare and publicly subsidized health care agency at the expense of the other important things we have to do," he said.

And Pawlenty said a safety net is there for Minnesota's most vulnerable residents.

"We have the most generous programs in the country - there's no question that it's (the safety net) is still there," the Republican said.

The Pawlenty administration meets almost daily with legislative committee chairman on omnibus bills, Pawlenty said. Budget Commissioner Tom Hanson has spearheaded that effort.

A new legislative commission was established to which Hanson has testified before." We accommodated that," Pawlenty said. "So far this commission hasn't taken one vote or made one decision. .. At some point they have to make some decisions and they have to make some compromise to bring this to conclusion."