With an improving economy and tax collections rolling into state coffers at an accordingly brisk clip, lawmakers heading back to the Capitol on Tuesday won’t be faced with quite so many hard choices as during recent sessions, when chronic deficits provided the fuel for pitched budget battles.
That said, the projected $1.03 billion surplus is no guarantee of a funding bump for the scads of government agencies, special interests and nonprofits that have been busily compiling their wish lists.
The intense competition could make for a disappointing session for the judicial branch, which is seeking a 7.5 percent funding increase — or an additional $45 million — mostly to pay for raises for court personnel after five consecutive years of salary freezes.
With a newly crowned Republican majority in the House, the prospect for raising additional revenue through tax hikes is a nonstarter, which further amplifies the stakes in the fight over the surplus dollars.
“A lot of people have been coming trying to get money. I think there’s going to be a pressure in just about every category of the budget, despite the projected surplus,” said Sen. Ron Latz, DFL-St. Louis Park. “I don’t think there’s going to be much left for any new initiatives.”
Latz, who chairs the Senate Judiciary Committee, pointed out that the $1.03 billion surplus vanishes pretty quickly after factoring in inflationary costs and the statutory mandate to set one-third of the surplus in the state’s reserve fund.
“The surplus isn’t really a surplus,” said Latz. “It reflects an increase in revenue based on inflation. But it doesn’t project inflation on the other side to maintain the same level of services. So we’re really left with very little new money.”
A few of the big ticket items already on the Legislature’s agenda would gobble that up that new money in a blink. Among a few of the notables: Gov. Mark Dayton wants $175 million worth of child care tax credits, the University of Minnesota is asking for an additional $130 million hike, and the Coalition of Greater Minnesota Cities is looking for a $45.5 million increase in local government aid.
“It will be interesting to see how the governor balances the budget with all the stuff he wants to do. My fear, frankly, is that everyone is going to look to that reserve for their funding source,” said Latz.
Latz’s counterpart in the House, Rep. Tony Cornish, R-Vernon Center, echoed that sentiment. The larger budget picture aside, he pointed to the myriad funding requests he’s gotten as the chair of the House Public Safety and Judiciary Finance Committee.
“I don’t think very many people will be satisfied with the fulfillment of their requests,” said Cornish. “The public defenders want 21 new full-time employees. The Battered Women’s Coalition wants $10 million. [Chief Justice] Lorie Gildea wants a 7.5 percent raise for court staff. You go through that one by one and it doesn’t take you long to realize how quickly the surplus will disappear.”
While the courts and other government agencies can complain about years of chronic underfunding, Cornish expects lawmakers will set budget priorities based on last year’s allocation and inflationary pressures, not a distant view of sessions past.
He said new initiatives will likely face tough sledding.
“I’m going to look with a very critical eye at any new programs, whether they claim innovation, or saving money with new software or by hiring new supervisors,” said Cornish.
Does that mean he wants to rule out further expansion of specialty courts?
With the opening of three new DWI courts in northwestern Minnesota on Jan. 1, the state now has a total of 50 specialty courts, which are designed to address recidivism among chronic drunken drivers, drug users, and mentally ill defendants through intensive counseling, treatment and social services.
While advocates point to research finding that specialty courts can provide long-term savings despite their higher upfront costs, Cornish views such claims with skepticism.
“Everybody says that,” he said. “The Legislature has gotten favorable reports on specialty courts and I do like them. But I want more data before we expand statewide.”
Despite growing complaints about the skyrocketing court fees and fines over the past decade, both Cornish and Latz are bearish on the prospects for roll backs this session.
“I’d love to reduce a variety of these fees and fines, but I’m a budget realist,” said Latz.
However, Latz said he intends to take a closer look at the $680 license reinstatement fee for convicted drunken drivers. He said he will push for legislation to give all defendants up to two years to pay, an option that is currently restricted to public defender qualified individuals.
Latz spearheaded payment plans for the poor in an effort to reduce the number of convicted drunken drivers who, balking at the high reinstatement costs, continue to drive illegally. He said it makes sense to expand that option.
“To me, it’s just a public safety issue. If people can’t afford reinstatement, they’re going to drive anyway and take their chances,” Latz said.
However persuasive the policy argument, Latz said budgetary concerns could prove an impediment for expanding the payment plan option — let alone reducing the reinstatement fee — because it would still have an impact on the bottom line.
For his part, Cornish said he is not interested in reducing any court fees or fines.
“I’ll be happy if we can find a way to leave everything as it is. And I’ll be very critical of any decreases,” he said. Cornish said he would oppose any changes to the DWI reinstatement fee “unless we find a way to replenish that. It can’t come from one time surplus money.”
On the policy front, Latz and Cornish agreed that privacy issues will likely dominate much of the session.
In particular, Cornish said he expects the Legislature will address how long police agencies will be allowed to store data collected by automated license plate readers. Police say such records can be useful in solving crimes, while privacy advocates argue that maintain such a database essentially amounts to unwarranted mass surveillance.
Last session, the DFL-controlled House and the Senate failed to reach a compromise, but Cornish said he is optimistic that won’t be the case this session.
“There is no law governing retention. If we fail to find a solution, that means there’s no limit and they can keep the data as long as they want,” Cornish said. “We just have to settle on how long. I would think it will fall somewhere between zero days and 180 days.”
On the other hot button issue with privacy implications — the regulation of drones — Cornish said a solution will likely prove more elusive, at least for this session.
“We might have to sit back and wait until the FAA [Federal Aviation Administration] takes action. Right now, I think there’s too much chance that we jump in, make a mistake and over-regulate,” Cornish said.