MN Gov. Dayton and legislature reach budget deal: Government to resume soon

Deltek. Sr. Analyst Chris Cotner reports.

While still in the midst of the longest state government shutdown in U.S. history, Governor Dayton and the Republican-led state legislature announced an agreement that would soon end the standoff. Both have pledged to “work around the clock” until all of the details can be finalized. The Governor will then call a special session, the bill will be introduced and, if all runs smoothly, signed by all parties. After the bill is passed (our early projection is by 7/19/11), full government functioning will resume.

What the shutdown has meant for businesses

Businesses have struggled in Minnesota. Not just contractors doing business with the state, but many of the small mom and pop shops around the state. Media has widely reported cases of expired licenses, permits, and other official documentation for all sorts of businesses, professionals, and products. For example, if your liquor or tobacco license ran out during the shutdown, there was no way to renew. Professional licenses, including those for doctors and nurses also expired, with no way to renew. Business licenses expired. As mentioned in an earlier INPUT blog, the state stopped payment on all “non-essential” contracts. So, many vendors working with the state have been forced to either shutter projects or operate without payment. Good thing there is an end in sight.

What are the changes and compromises?

While the final legislation has not yet been introduced, the press releases give some idea of what is to come. Here is what has been reported, thus far.

• Prior to the deal, the two proposals had a $1.4 billion gap that needed to be filled; Minnesota has a legislative balanced budget requirement.
• Prior to the deal, Republicans wanted to cut and wanted no new taxes (a stump issue in recent state elections).
• Prior to the deal, Dayton wanted fewer cuts and tax increases on the wealthy (a campaign promise).

For the complete blog, go here.