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John Nephew

Maplewood City Council Policy & Politics


More on the Unallotment Decision

This week's online newsletter from the League of Minnesota Cities includes an article about Judge Gearin's decision to overturn the unallotment of funding to the Minnesota Supplemental Aid Special Diet Program. It provides a good explanation of the ruling and some of its impact, especially as relates to cities -- the main impact being "more uncertainty". It also says that the League board will discuss what if anything to do, in light of the decision, at its upcoming meeting on January 21st.

I've decided that I'm not eager to see the LMC and other entities join in a flurry of lawsuits to overturn the unallotments. I think it is vital to have a test case like the Special Diet Program to work through the constitutional issues, so I'm pleased with both Gearin's ruling and the Governor's decision to appeal it. This case ought to go to the Minnesota Supreme Court, either to clarify the statute's interpretation or to make the legislature rewrite it to pass constitutional muster.

But overturning Pawlenty's actions last year won't cause money to appear in the state coffers to restore those cuts. Any 2009 funding restored in court is only going to increase the cuts that will have to be made by the legislature and governor to balance the remainder of the biennial budget. It would be a zero-sum game, except for the legal fees that make it less-than-zero.

Partisan Angles
Many commentators seem to have taken Gearin's decision as a major blow to Governor Pawlenty and the Republicans, and some conservative partisans have gone further to suggest that it represents liberal judicial bias (a claim that doesn't really hold up in light of the many rulings in Gearin's career on the bench).

Sarah Janacek at Politics in Minnesota takes a different view than many of her colleagues on the right, calling the ruling "Good for the state and spectacular for Pawlenty and the Republicans." Janacek seems to accept the basic separation-of-powers argument in Gearin's ruling, without jumping to conclude that it was biased and wrong just because it was not the ruling the Republican governor had sought. The way she sees it playing out, the court decision may bring us back to legislative-executive gridlock, but she sees that situation as benefitting Republicans because Pawlenty will have nothing to lose. If he lets the government shut down for lack of a budget deal, it will only increase the national attention and anti-tax reputation that he seeks for his presidential aspirations. For his presidential run, the national reputation matters more than his popularity in Minnesota, where he won election and reelection with less than 50% of the vote.

Janacek's analysis is intriguing, though I'm not sure it will work out that way. What I do think is important is to realize that what politicians and parties want in the short term doesn't always play out the way they imagine it will. Republicans should not revile this decision just because it is a tactical setback for Pawlenty, and Democrats should not be too satisfied or mistakenly think that this represents a seismic shift of the budget negotiating terrain to their advantage. As Janacek points out, the governor still has the veto (and line-item veto), and as a lame duck official with aspirations for a higher office, he probably has less to lose than do DFL legislators if he decides to take a hard line and refuse compromise.

Maplewood's Bottom Line
No doubt there will be a lot of drama in the coming legislative session as state leaders wrestle with the budget. Unfortunately, I think the end result for Maplewood is pretty much the same in any scenario -- our Market Value Homestead Credit is gone, and I don't see it being restored. There's a lot of focus on the short-term forecasts and budgets, but the long term picture for state finances is even more challenging. I believe Maplewood has to plan for the future with the assumption that our MVHC, like Local Government Aid, is gone for good. If we do happen to get some in a future year, we should treat it as a windfall for one-time uses, such as capital expenses or debt reduction, rather than part of the operating budget.

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