Local lawmakers say schools should get their fair share of budget surplus

/ 29 February 2012 / jennifer

Mark Sommerhauser, St. Cloud Times, February 29, 2012 –

St. Cloud-area lawmakers hailed Wednesday’s projection that the state budget will run a $323 million surplus, while at least two said the extra dollars should remain off-limits.

The projection was released as part of the state’s twice-yearly economic forecast. It was the second-straight forecast of a surplus in Minnesota’s finances, after a $5 billion deficit dominated last year’s legislative docket.

But the forecast says budget woes could return to Minnesota in the near future, forecasting a deficit of about $1.1 billion — not including inflation — in the next two-year budget cycle.

Sen. John Pederson and Rep. King Banaian, both St. Cloud Republicans, said Wednesday that the current surplus should be used to start repaying delayed state payments to school districts, agreed to in last year’s budget deal between GOP legislators and DFL Gov. Mark Dayton.

That’s where most of the surplus dollars would go under current law, along with replenishing state reserves.

“I’m sure there will be temptation,” Banaian said. “But paying down the school shift I think is something a lot of people want to see happen.”

Banaian acknowledged that using the term “surplus” to describe the state’s budget picture doesn’t tell the whole story.

Infusions of one-time cash, including the delayed school payments and proceeds from borrowing against tobacco revenues, were the linchpins of last year’s budget agreement that ended Minnesota’s state government shutdown.

Rep. Tim O’Driscoll, R-Sartell, declined to say what he’d like to see done with the surplus. But he acknowledged repaying the shifted school payments should be a priority.

Pederson called the forecast encouraging, adding that he hoped no one would use it for political ammunition.

At the same time, another local Republican legislator hailed the forecast surplus as proof that his party’s budgeting approach is paying dividends.

Rep. Steve Gottwalt, R-St. Cloud, said the economic forecast heralds a fiscal “turnaround” for a state that faced a deficit of more than $5 billion during the 2011 legislative session.

“Make no doubt about it, this turnaround in our state budget is due in large part to the fiscal discipline Republicans applied during last year’s difficult session,” Gottwalt wrote in a news release.

Others said the forecast surplus is illusory. Minnesota’s continuing indebtedness of more than $2 billion to school districts overshadows news of a surplus, Minnesota DFL Chair Ken Martin said in a news release.

“The current surplus represents little more than a minimum payment on what we owe our schools, and we can expect to continue paying for Republicans’ budgeting gimmicks and accounting shifts far into the future,” Martin said.