Not a Dollar Higher: Tax Negotiations

By Mike McIntee and Noah Kunin


Consider it a reverse-bidding poker game between the Minnesota House, Senate and the Governor. At stake, how to overcome Minnesota’s massive budget deficit – with each dollar taken off the table Minnesota faces reductions in everything from health care services to filling potholes on city streets.


This weekend House Tax Chair Ann Lenczewski and Senate Tax Chair Tom Bakk played a hand of tax negotiations, each trying to stare down the other.


The House, Senate and Governor’s proposals are all separated by hundreds of millions of dollars and vary greatly on how revenue is raised and expenses cut. Governor Tim Pawlenty favors borrowing $1 Billion over 20 years at the expense of anywhere from $700 Million to $900 Million in interest as well as delaying $1.2 billion in education payments.


The House and Senate versions raise taxes now to overcome the structural deficit.  The House raises $1.5 billion and delays $1.7 billion in disbursments to schools.  The Senate proposal would increase state revenue to the tune of $2.2 billion without any borrowing or payment delays.


In this clip, the House and Senate Tax Chairs stake out their postions.

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