Local Government Aid

By | Economy, Kevin Dahle MN Senate District 20, Rice County, Scott County | No Comments

This past Friday I attended a meeting of SCALE, Scott County Association for Leadership and Efficiency. This organization is one of a kind in the state of Minnesota, bringing together the Mayors, city councils, Superintendents, County and City Administrators and others to talk about the issues facing these various units of Local Government. Of course, the state budget and the possibility of losing Local Government Aid (LGA) this December dominated much of the discussion.

Scott County has already trimmed $3 million from its 2009 budget. These cuts will likely mean fewer services available through county public libraries, less money for County Parks, road expansion and maintenance. The county is also reducing its contributions to outside agencies like the County fair, the historical society, and an organization that provides support for battered women.

Cities and counties both have set their budgets for 2009. Northfield is expecting a December LGA payment of $1.4 million. Money has already been spent to provide services to local government departments and agencies assuming the state would fulfill its obligation. Many cities lack the cash flow cushion to sustain large revenue cuts this late in the year, especially without warning.

The state of Minnesota must find $426 million to fill the gap in the current budget shortfall. This must be done by June 30, 2009. If the Governor is set on using LGA to fill that gap, I hope he makes proportional cuts that will allow cities and counties to still receive badly needed checks this December instead of a blindsided approach that leaves our local governments reeling.

Budget Woes

By | Economy | No Comments

According to the state’s November fiscal forecast, Minnesota faces a projected $4.8 billion shortfall for 2010-11, and an additional $426 million for the current budget year.  The forecast, derived from numerous economic factors and trends, is a snapshot of the state’s fiscal landscape used by the Legislature and governor to help develop the state’s upcoming biennial budget.

The fiscal news came as no surprise, as unemployment rose to 6.0 percent and the state lost 7,500 jobs in October.  This year, Minnesota dropped 25,900 seasonally adjusted jobs from January through October.

Gov. Pawlenty and other governors met with President-elect Obama in early December to discuss a possible economic stimulus package that may include aid for states facing budget deficits.  It is estimated that 41 of the 50 states are expecting to face budget shortfalls next year.  Governor Pawlenty has reacted cautiously to the plan, despite the fact that Minnesota ranked 46th in terms of receiving federal tax dollars per tax dollar paid, according to the Tax Foundation.  Their report shows Minnesota received only 72 cents for every dollar sent to the federal government in 2005; however, neighboring North Dakota ranked 6th and received $1.68 for every dollar sent in.  Minnesota should be getting its fair share of the federal budget outlays.  Minnesotans also pay federal income tax..

State Economist Tom Stinson said Minnesota may take longer to come out of recession compared with the rest of the nation.  Much of the state’s budget deficit has been created by falling revenues, not by government overspending. Cutting spending will not replace absent revenue. Only business and trade growth can do that.  Some experts are projecting a loss of 77,000 additional jobs in 2009.  Various legislative working groups, such as the Green Jobs Task Force, already are meeting to discuss how to create jobs in Minnesota both in the short and long-term.

Governor Pawlenty, in his state budget deficit resolution proposal, will not only cut state budget items but will work to drive more service costs toward local government. Under the guise of conservative fiscal restraint, he’ll continue implementing a public policy vision that strangles communities.  In the short term, downward budget pressure may seem like a reasonable government limitation. The net result over time, however, is less than the sum of its parts. Our entire state becomes less safe and our quality of life declines precisely because aging communities have a lower property tax base and reduced capacity for public safety services. Fewer cops in one place eventually create crime problems in others.

The Minnesota Senate and House will need to work with the Governor to solve this crisis.  We need to find growth strategies that will help bring Minnesota out of a true economic collapse.  We ask all constituents to provide us with input on strategies and solutions that will maintain a quality of life we have come to expect in Minnesota.

Obama’s Message: Unity, Hope, & Taking Responsibility

By | Economy, Kevin Dahle MN Senate District 20, Le Sueur County, Rice County, Scott County, Sibley County | No Comments
  • “I ask you to believe – to believe in yourselves, in each other and in the future we can build together. Together, we cannot fail. Not now. Now when we have a crisis to solve and an economy to save…”
  • “We can do this. American’s have done this before…”
  • “Now it falls to us. Together we cannot fail. Together, we can overcome the broken policies and divided politics of the last eight years…”
  • “We can do this if we come together; if we have confidence in ourselves and each other; if we look beyond the darkness of the day to the bright light of hope that lies ahead. Together we can change this country and change this world.”
  • “It’s the answer that led those who have been told for so long by so many to be cynical, and fearful, and doubtful of what we can achieve to put their hands on the arc of history and bend it once more toward the hope of a better day.”
  • “This is our chance to answer that call. This is our moment. This is our time – to put our people back to work and open doors of opportunity for our kids; to restore prosperity and promote the cause of peace; to reclaim the American Dream and reaffirm that fundamental truth – that out of many, we are one; that while we breathe, we hope, and where we are met with cynicism, and doubt, and those who tell us that we can’t, we will respond with that timeless creed that sums up the spirit of a people: Yes We Can.” – Barack Obama, President-Elect

Imagine Minnesota

By | Economy, Health Care | No Comments

This past session, the legislature faced the unenviable task of cutting nearly $900 million from the state’s budget.  Nearly $150 million was cut from Health and Human services, significantly less than the $526 million proposed cuts by Governor Tim Pawlenty.  No funds were transferred from the Health Care Access fund and nursing homes did receive a cost of living adjustment, however budget cuts at this level can have a big effect on services to families, workers, youth, the disabled, and the elderly.

This next budget will be even more challenging.  Budget shortfall estimates range from two to four billion dollars. Long term savings achieved from investments in health and human services are rarely reflected in short-term biennial budgets.  Investments in the people of Minnesota are particularly critical when our state economy is suffering the effects of job losses, record home foreclosures, and rising food prices.

A letter recently received entitled Imagine Minnesota, representing nearly 200 organizations offers up the following vision for our state:

  • Nobody goes to bed hungry
  • Every person has access to the transportation they need to fully participate in their communities.
  • Every person has a place to live and to work.
  • Older adults and people with disabilities have access to the services they need.
  • All children have access to quality early learning experiences.
  • Everyone has access to quality health care, including mental health care.

Investments in health and human services are vital to hundreds of thousands of Minnesota’s most vulnerable citizens.  Let’s keep them foremost in our minds when making budget decisions for the next biennium and beyond.

Home Economics

By | Economy, Le Sueur County, Rice County, Scott County | No Comments

The recent headlines describe the federal government’s $700 bailout of Fannie Mae, Freddie Mac, and the banking industry to bring some stability to an economic crisis. The bailout is an attempt by the Federal government to deal with a serious problem that is affecting every household in America. Early signs of economic trouble showed up this past year in the housing industry in Minnesota and all across the country.

Home foreclosure will increase 39% this year statewide, and one out of every 31 Minnesota households will have experienced foreclosure between 2005 and the end of this year.

The Minnesota Senate, last session, passed a number of bills to deal with this issue. The measures were designed to help families facing foreclosure by connecting them with foreclosure prevention counselors. The bill also required a postponement of a sheriff’s sale if the sheriff’s office had not received a response from an owner within 7 days of a sheriff’s request. Other bills expedited the foreclosure process for abandoned properties which can become a nuisance to neighbors and communities with lack of upkeep, drug and illegal activities, theft of copper and other salvageable materials.

The Minnesota Sub-prime Borrower Relief Act was another attempt to deal with the housing crisis. This piece of legislation would have allowed eligible homeowners to defer a pending foreclosure for up to a year if their lender refused to negotiate in good faith, while still holding the homeowner responsible for full payment after the deferment. Unfortunately, this bill was vetoed by the Governor.

It is interesting to hear what the presidential candidates are saying about the economy. It has become a national crisis that will set the agenda for the Minnesota legislature this coming session. While no one could have foreseen the downward spiral we are experiencing now, the Minnesota Senate introduced several initiatives to try to get ahead of this problem.