Deficit fix plan to be announced

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ST. PAUL -- The final week of the 2010 legislative session begins this morning with Democratic leaders unveiling their plan to balance a nearly $3 billion budget deficit, much of it left by last week's Minnesota Supreme Court ruling that threw out Gov. Tim Pawlenty's 2009 budget cuts.

Much of the plan is expected to look like the cuts Pawlenty made last summer, but more than $400 million of the Democratic plan are expected to be tax and other revenue increases, much of which Pawlenty likely will reject.

Sunday is the final day legislators can pass bills, although they may conduct ceremonial business a week from today. That means the deficit must be filled by then unless law makers go into special session that only can be called by the governor.

On Friday, Pawlenty suggested that he might need to call a special session to deal with the budget, but did not go into specifics.

Legislative leaders say the deficit fix needs to contain a mixture of budget cuts, delayed state payments and new revenues, such as tax increases. Pawlenty's plan includes cuts and delays, mostly in later school payments, but he firmly opposes any higher state taxes.

The governor generally calls for cuts in payments to local governments, but Democrats in control of the Legislature want smaller cuts.

The DFL plan could receive full House and Senate votes as early as today.

On Friday, the House rejected Pawlenty's budget plan; senators rejected it earlier this year.

The state's two-year budget is about $30 billion. Pawlenty last year used the Minnesota "unallotment" law to delay school payments and cut spending, but the high court last week said that action was not legal.

Since last summer's cuts, the deficit has grown by about $500 million.

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