State shutdown impacts are still unknown

If the Minnesota Legislature and Gov. Mark Dayton cannot reach agreement on a state budget by July 1, parts of state government would shut down. That’s because the state’s fiscal year ends June 30.

What a shutdown could mean is still being sorted out. But the impacts for Minnesotans with disabilities could be very serious. Not only would many state services be shut down, there is also the ripple effect of cuts to funding for counties, cities and school districts that also provide services.

The prospect of disagreement over the state budget and a shutdown loomed over the capitol this session. In January the Senate Health and Human Services Finance Committee held an overview of what a state shutdown could mean and discussed what happened during the 2005 shutdown. But the need for a special session and the potential of a shutdown became reality when Dayton vetoed nine budget bills after the May 23 adjournment deadline.

Dayton and Republican House and Senate leadership met June 3, with the Republicans proposing daily meetings through June 27. That would lead up to a special session. But with Dayton wanting some form of cuts and tax increase, and Republicans saying no to any new taxes, it’s not clear what the outcome could be. House and Senate leadership want to limit spending at $34 billion; Dayton wants a budget that is at least $1.5 billion higher.

A shutdown could have costs for the state, in terms of shutting down and then restarting government. Revenue would be lost from many fees and permits. “It’s a losing proposition for the taxpayers of the state of Minnesota,” Political Analyst and Hamline University Professor David Schultz told KARE 11 TV. “Overall, the costs associated with the shutdown are far greater than any savings that occur as a result of a shutdown,” he explained.

That state has about 58,000 workers who potentially could be affected by a shutdown. It’s not clear how many would be laid off and which services would be shut down. Layoff notices to state employees began going out the second week of June. Contract service providers have also been notified. During the last shutdown, in 2005 about 9,000 employees were laid off. But that year more than half of the budget bills had been approved, keeping some state operations open. This time, only the Department of Agriculture has budget passed and signed by Gov. Dayton. What were considered to be core functions of state government were allowed to remain open in 2005. But many services were cut for the 10-day shutdown.

What’s not clear now is what would be considered core services, especially since much of the recently ended 2011 session focused on cuts to government. In its legislative update, Courage Center answered the question of core government functions by stating, “The current budget stalemate really centers on this question. In general, the legislative majority says government is too big and spends too much. Dayton says shrinking government by $5.1 billion – the size of the current budget hole – would result in an abdication of government’s responsibilities to Minnesotans. This is really a debate about the role of government, how much different groups of taxpayers should pay to fund it, and what taxpayers should get in return for their revenue. In 2005 the decision of what was and wasn’t a core function was left in the hands of the courts. That could possibly happen again. Minnesota Management & Budget Commissioner

Jim Schowalter announced the activation of the state’s Be Ready website. The website is a resource for citizens, state employees, members of the media, and government service stakeholders in relation to contingency plans for a potential break in government service. The website offers a variety of information for public parties including employee relations information, frequently asked questions, and information for the media.

“The administration’s highest priority remains negotiating a compromise budget agreement. However, in order to be responsible stewards of the state, we need to plan accordingly for all circumstances.  This website is another tool for our employees and stakeholders to use to answer some of their questions. It is critical we provide clear and concise information to everyone,” Schowalter said. The website will be continuously updated as information is released.

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