ECM Capitol Reporter
It happened. For the second time in Minnesota state history a budget impasse at the State Capitol has shut down state government.
Democratic Gov. Mark Dayton and Republican legislative leaders on Thursday, June 30 failed to reach a state budget compromise and some 20,000 state employees now face layoffs.
“This is a night of deep sorrow,” Dayton said, speaking at a 10 p.m. press conference. “I don’t want to see the shutdown occur.”
Dayton styled the budget impasse as boiling down to taxes.
Republican don’t want to raise taxes on anybody, while he believes wealthier Minnesotans can afford to pay more, he said. “That’s the crux of the difference,” Dayton said.
He could not accept having the elderly, the disabled, and others losing state benefits, said Dayton.
Late Thursday afternoon Republican legislative leaders gathered outside of the Governor’s Office after dropping off a “lights on” bill for the temporary funding of state government. They urged Dayton to immediately call a special legislative session so they could pass the bill.
Senate and House Republicans sat in their respective chambers as in instant readiness to go to work once a special session was called.
But Dayton did not exercise the sole power of governors and call a special session.
At the press conference, Dayton, much to the chagrin of some Republican lawmakers filling the back of the Governor’s Reception Room, brushed aside the lights on offer. “I take it as a publicity stunt,” he said.
Dayton’s remark drew groans and guffaws from some Republicans. Other Dayton comments had the same affect.
But Dayton indicated he was not through negotiating. “I will continue tonight, tomorrow and however long it takes to find a fair and balanced compromise,” Dayton said.
“I welcome Republicans to join with me – my door is always open,” he said.
Republican legislative leaders appeared exasperated as they later gathered to meet with the media.
House Speaker Kurt Zellers, R-Maple Grove, said Republicans had sent the governor repeated budget offers. “And here we sit an hour and a half before a government shutdown and the governor threw in the towel,” Zellers said.
Deputy Senate Majority Leader Geoff Michel, R-Edina, charged Dayton’s motives were political. “The governor has chosen maximum pain for the political gain,” he said.
Thursday budget offers passed between Republican leaders and Dayton included an offer from Republicans that contained a school aid payment shift and issuance of tobacco bonds to help cover a $1.4 billion gap in revenue — the extra dollars Dayton wants.
According to Republicans, Dayton at one point in budget negotiations, carried out behind closed doors, took his proposed tax increase off the table.
In a letter to Republicans, the governor indicated he was willing to accept a 10 percent school aid payment shift, but would not agree to both a shift and tobacco bond issuance.
At the press conference, Dayton complained the offer wasn’t really bringing in new revenue but more debt.
Instead, Dayton proposed a income tax increase on Minnesotans earning more than $1 million, which would impact only 7,700 Minnesotans and bring in $746 million over two years, he said.
Dayton and Democratic legislative leaders also looked to corporate and sales tax “reforms” and nonresident estate taxes to raise an additional $300 million.
But Republicans remained unwilling to raise taxes.
Senate Majority Leader Amy Koch, R-Buffalo, indicated that Republicans are willing to continue budget talks.
“But he (Dayton) gave up,” she said.
State government will not entirely shutdown — Minnesota State Troopers will be patrolling the highways, for instance. That’s because of a recent court order that will keep the core functions of state government operating.
No future budget talks are planned at this time.