MARSHALL?- With an eye on reducing state spending, Republicans in the House and Senate on Thursday released an outline for cuts to deal with a $5 billion budget shortfall and, as anticipated, among their targets is aid programs for local governments.
House GOP leaders said they would push to provide $300 million in tax relief to low and middle-income residents. Details on the tax breaks will emerge as the bills come together, they said.
Along with aid to local governments, money for higher education and state agency operations would fall by hundreds of millions of dollars each compared with projected spending.
But District 21 Sen. Gary Dahms stressed Thursday that just because aid to local governments could potentially take a hit, it doesn't mean Local Government Aid will be sacrificed.
"We're working very hard to keep LGA where it was last year," said Dahms, R-Redwood Falls. "You may see some cuts in LGA, but they're not cuts that will wipe LGA out. I still think we're going to see some reasonable numbers coming on LGA. We're going to have LGA; we just need to try to hold it as close to where it was last year, and I feel confident we'll have some success in doing that."
LGA is part of a tax aids and credits spending package that could see as much as a 9.6 percent decrease. Dahms said that package has yet to be broken down, so it's unclear where the cuts will hit the hardest.
"I would say a fair assessment would be that everyone will need to share in solving the budget problems here," said District 22 Republican Sen. Doug Magnus of Slayton. "We can't continue spending on auto pilot; that's what the governor wants to do in his proposal - a 25 percent or higher increase in spending. That's not sustainable. I don't think anyone in the state thinks we can sustain that level of spending. We have to live within our means."
Dahms said too many people pick out LGA when the discussion of cuts comes up because it has become one of the more controversial issues of the 2011 session. Both Dahms and Magnus said it's too early to determine the fate of LGA and how deep any potential cuts to the program would be.
"We're not at that point yet," said Dahms. "But we're working hard to protect LGA."
Majority Republicans largely leave spending for K-12 education intact, although they would continue a $1.3 billion state payment delay that gets checks to schools slower than normal.
"We talked to the education community and it was their preference to continue that shift with the hope of not seeing any additional cuts to education," said Magnus.
The legislative budget outlines differ slightly, but both would commit Minnesota to about $34 billion in overall spending during the next two years. Both plans also go against budget recommendations made by Gov. Mark Dayton, who has proposed raising taxes on the state's most affluent residents to allow the state to spend about $3 billion more in total.
Dahms reiterated the GOP's stance against tax hikes, saying raising taxes would simply push the financial problems the state is currently facing into the future.
"If we raise income taxes this year the money is spent and next year we would have to raise them again," he said. "If you raise taxes to solve the budget problem, within a matter of a few years we're broke and the people who are paying those taxes, they're not going to be here. You can only go the well so many times before people can no longer pay the taxes."
AFSCME, a union of 43,000 public and non-profit workers in Minnesota, criticized the GOP plan, saying in a news release that Republican senators broke their campaign promise to cut taxes and create jobs.
"Their budget cuts thousands of jobs, raises property taxes by hundreds of millions, and hikes tuition on students," AFSCME Council 5 Director Eliot Seide said. "Their top priority is to hurt workers while protecting the rich.
"The choice is clear," Seide added. "We can tax workers out of their homes, or we can tax the rich. We can lock libraries and parks and lose police and fire protection, or we can tax the rich. We can make college unaffordable for working families, or we can tax the rich. We can cut child protection, or we can tax the rich. We can abandon the elderly and disabled, or we can tax the rich. Gov. Dayton's budget reflects Minnesota values of fairness and compassion. Republican senators need to drop their budget ax and find their hearts."
The Associated Press contributed to this story.