Clock Strikes Midnight: No Deal

The state of Minnesota has officially shut down, much to the chagrin of protesters on the Capitol steps.

“I think that (reaching a deal) is the responsible thing to do, that’s what the job of the government is—to keep it open, to keep it running, to figure out how to work a budget,” said Burnsville resident Neil Aasve from the foot of the capitol building.“The stubbornness that’s going on is just not what government is supposed to do. Trying to come out of a recession laying off a lot of workers— private or public it doesn’t matter—it’s just going to leave a lot of people unemployed so that’s not going to help anyone.

After weeks of intense negotiations, capped by closed-door sessions through Thursday’s waning minutes, Gov. Mark Dayton and Republican lawmakers failed to agree on an operating budget for the coming biennium.

“I deeply regret that after two days of intense negotiations we have failed to reach an agreement,” Dayton said during a 10:30 p.m. press conference in his office.

Dayton continued: “I offered a plan to raise the taxes of only those Minnesotans who make more than $1 million per year. That is less than 0.3% of the state population. Despite many hours of negotiations, the Republican caucus remains adamantly opposed to new taxes.”

Earlier in the week, Gov. Dayton said a deal would have to be done by Wednesday in order to draft and pass the necessary legislation. But Thursday, the governor continued meeting with GOP leaders on-and-off trying to put an agreement in place.

At around 10:30 p.m. Thursday evening Gov. Dayton rejected a 2-page temporary funding deal from the GOP leadership that would keep the Minnesota government operational for an additional 10 days.

"There are a lot of people on the steps of the Capitol right now asking us to not shut down the government,” Koch said. “This document is their answer.”

When asked his response to the 10-day temporary funding bill, Gov. Dayton’s answer was frank and clear: “I think it’s a publicity stunt,” he replied.

The day’s events smacked of the political posturing that has become characteristic of these budget negotiations.

There appeared a glimmer of hope early Thursday evening. But around 8:30 p.m., Rep. Tony Cornish (R-District 24B) reported to his seat in the Minnesota House saying he had received a message from the GOP leadership to do so. “There is always time for a deal,” Cornish told reporters as he walked into the House.

The gesture was called “grandstanding,” “theatrics” and “mock legislature” by Democratic minority leaders Sen. Tom Bakk and Rep. Paul Thissen.

Bakk took the podium at 9 p.m. and pleaded with his GOP counterparts to return to the negotiating table instead of sitting in the legislature. “We are running out of time,” he said plainly.

Bakk’s statement proved prophetic. Fiscal year 2012-13 began at 12:01 a.m. today and, without a budget in place, the State of Minnesota was unable to fund its myriad services or pay salaries to its almost 33,000 state employees—22,000 of which left their offices today without a job to return to.

Owing to a June 29 ruling by Ramsey County District Court Judge Kathleen Gearin, state correctional facilities, nursing homes, public safety, and payment of medical services are all considered “core functions” of government and will continue operating. Everything else is no longer functional until a budget deal is reached.

The heart of the impasse has always been the $1.8 billion difference between Gov. Dayton’s operating budget and the budget proposed by the GOP. Central to the issue is the method for closing Minnesota’s $5 billion budget gap.

Gov. Dayton and the GOP leadership haven’t committed to a date for the next round of negotiations.

The effect of the shutdown will be somewhat muted for local government in Burnsville.

School districts will largely be spared. However, the Burnsville-Eagan-Savage School District already passed a preemptive measure on June 22 when the Board of Education authorized the sale of up to $12 million in aid anticipation certificates. The loan would allow the district to meet its immediate operating expenses, including paying salaries, if the state shut down and payments were delayed. ISD 191 garners about 80 percent of its operating dollars come from the state.

"Essentially, this is a cash flow management move," said District 191 Business Manager Lisa Rider in a press release on June 27. "We have summer programming that we've committed to and our parents and students have committed to it. Unfortunately, the potential state shutdown means we need to be ready to borrow money to cover those costs in the short term."

The board scheduled a meeting for July 21 to give final approval to the sale.

At the time, it was thought that a shutdown could delay state aid payments to school districts. However, districts were spared when Gearing ruled that state aid to school districts must continue during the, which could alleviate financial stress on ISD 191.

At city hall, Burnsville Spokesman Marty Doll said the effect of the shutdown on the city was unclear.

“Currently, Departments are supposed to be compiling what they anticipate could be ‘potential’ effects on the City and its operation. Department heads will be meeting at the end of the month to discuss, and the City in general should have a clearer picture by then,” Doll said in the weeks approaching the deadline. “Right now, as I mentioned, we’re really just in brainstorming mode.”

On a larger scale, Dakota County will operate more or less as usual, with the exception of the Dakota-Scott Workforce Center in Burnsville, which will close until the state shutdown is lifted. Dakota County’s $307 million budget for 2011 includes more than $59 million in County Program Aid and state grants, and another $12 million in Federal dollars that are doled out to the county through the state.

As late as Tuesday, those payments were not included in any barebones funding plans from lawmakers that were in front Ramsey County judges. But the comprehensive June 29 ruling by Judge Gearin made it clear Local Government Aid and other standing appropriations, such as Federal aid, was to be disbursed to counties, cities and school districts, said Gail Plewacki, communications director for the county.

“The ruling has taken some of the pressure off,” she said.

As a result, all 275 county workers will have work come Friday, though their job security could be threatened if the shutdown becomes a lengthy affair.

“I can’t guarantee that there will be no impacts on our work long-term,” Plewacki said. “If the shutdown is over quickly we won’t have an issue with idle employees.”

To a limited extent, some county departments intimately connected to the state government apparatus will be able to operate for a short while. The license centers, for example, will remain open even if their corresponding offices at the state are not.

“The centers have everything they need — tabs, license renewal forms — to do what they need to do,” Plewacki said. “The only thing is that when it goes from us to the state they won’t be finishing things up on their end. But we can still remain open to do our jobs, at least in the short-term.”

The same cannot be said of the many state services administered by the county, some of which will be put on hold until the budget crisis is resolved. Gearin’s ruling made allowances for necessities: Programs such as Medical Assistance, MinnesotaCare, food stamps, county child protection services and services for the disabled joined state correctional facilities, nursing homes, public safety, and payment of medical services as “core functions” of government that will continue operating.

However, officials at the county are still trying to sort through the rest to definitively determine which programs will now fall by the wayside. As of Thursday night, Dakota County still did not have a comprehensive list of services that would be halted on Friday.

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