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Still dealing with a fat deficit, but terms are a bit different now

March 1, 2011
Marshall Independent

Let's not get overly excited about Monday's news concerning the state's budget deficit.

While $5 billion looks a lot better than $6.2 billion, the reality is it's still a lot to make up and doesn't erase the fact that schools have had nearly $2 billion withheld the last couple years thanks to the previous administration.

Let's also remember that Democratic Gov. Mark Dayton and the GOP-controlled Legislature are deeply split in terms of how to solve the deficit. Dayton wants new high-end income and property taxes, while Republicans are saying that would only drive businesses out of Minnesota or prevent them from starting up in the first place. The GOP wants to tame the deficit lion with spending cuts.

Is it good news? Yes. Can we breathe easy now? Definitely not. There will still certainly be hurtful cuts coming from both the state and federal levels - cuts that will put people out of work and take away some services many people depend on.

The real silver lining is that the news of a smaller shortfall has caused Dayton to rethink his plans for a budget deficit fix.

Since state Management and Budget officials released their report for the upcoming two-year budget, Dayton has toned down his tax-heavy budget proposal to eliminate a proposed 3 percent surtax on those making $500,000 or more. This would prevent Minnesota from having the top income tax rate at 10.95 percent, which would've been the nation's second-highest.

This should please the GOP, which has blasted Dayton's plan because of how it could affect the state's business climate. More importantly, Dayton said he will also reduce proposed cuts to nursing homes.

A?little good news these days can go a long way, but it should be taken with a grain of salt. We must still remember there's plenty of work to be done in St. Paul.



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