DFLers take aim at Pawlenty tax stance

The lights were dimmed in the basement of the State Office Building last week as House Speaker Margaret Anderson Kelliher prowled in semi-darkness, preparing for another round in DFLers' showdown with Republican Gov. Tim Pawlenty over taxes and spending.

After one such session -- in which DFLers took turns roasting state Management and Budget Commissioner Tom Hanson over Pawlenty's use of $2 billion in accounting shifts and borrowing to balance his budget -- Hanson joked: "I was thinking of coming to the next hearing with an apple in my mouth."

This week, as the May 18 adjournment of an exceptionally tense, high-stakes session looms, the DFLers who control the House and Senate once again must try to mount an effective counteroffensive against a governor whose staunch opposition to tax increases has stymied them again and again -- most recently with Saturday's veto of a scaled-down tax package.

To prevail, DFLers must persuade the public that Pawlenty's budget plan is fiscally irresponsible, punishing the vulnerable with deep cuts in health care while pushing the state's larger budget problems down the road. Yet their own alternative plans couple formidable tax increases with sweeping spending reductions -- including cuts to their most cherished institution, K-12 schools.

Late last week, unable to achieve a united front on earlier tax bills that had soared up to $2.2 billion, DFL leaders outflanked Republicans with a surprise maneuver that sent the $1 billion tax package roaring through both bodies on partisan votes Friday night and on to Pawlenty, who vetoed it.

The plan to raise revenue from drinkers, the wealthy and credit-card companies brought nearly every DFLer on board but left the House a few precious votes short of what is needed to overturn Pawlenty's veto.

Senate DFLers have a veto-proof majority, but House DFLers would need all in their ranks plus three GOP votes to override a veto.

Changing the equation

DFLers have outmaneuvered Pawlenty on occasion. It took a partial government shutdown in 2005, but they forced him to advance an adroitly named "health impact fee" that allowed government's tobacco take to rise. In 2008, following the Interstate 35W bridge collapse, DFLers wooed a handful of House Republicans -- some of whom later paid with their political careers -- to override a Pawlenty veto and wrest a nickel-a-gallon gas tax increase for the state's roads.

But year after year, shortfall after shortfall, Pawlenty has managed to stave off general tax increases with an argument simple enough to fit on a matchbook cover: Tax increases kill jobs. DFLers insist that the evidence for that remains slender and that budget cuts kill jobs too. But Pawlenty has most often won the rhetorical war, painting DFLers as spendthrifts who would rather tax than tighten government's belt.

Then came a game-changing presidential election, a historic recession and a staggering deficit that would have topped $6.4 billion but for a gusher of federal bailout money that is still sluicing through the state.

Determined to change the equation this year, DFLers stared down their own interest groups to offer deeper spending cuts than the governor and took aim at his borrowing plan as an admission that more revenue is needed.

Kelliher added to the new strategy by raising to unusual prominence what had been an obscure body, the blandly named Legislative Commission on Planning and Fiscal Policy, and transforming it into a bully pulpit, where she extols the DFL plan while forcing her largely captive audience -- Pawlenty's agency heads -- into a point-by-point defense of theirs.

While the commission remains largely unknown outside the small circle of political geeks who follow minutiae at the Capitol, its influence is becoming felt. Enough to earn it a withering nickname on Twitter, the Committee on Grandstanding and Waterboarding Tom Hanson, and another moniker from an irked governor, who has taken to calling it the Legislative Committee on Missing Their Own Deadlines.

Crowded week ahead

Kelliher said this week is when DFLers will ratchet up the pressure, reopening major bills to show recalcitrant Republicans -- many of whom oppose Pawlenty's borrowing plan -- what happens to their schools, nursing homes and hospitals without the DFLers' $1 billion gap-closer.

Will Rep. Keith Downey, R-Edina, be so eager to support Pawlenty when his health care cuts slash $11 million from the already struggling Fairview Southdale Hospital in Downey's district?, Kelliher asked. What about $19 million from the venerable St. Marys Hospital in Rochester?

"We're going to make the options very, very clear to them over the coming week," Kelliher said as the House chamber emptied Friday night following a decisive, if partisan, vote for the $1 billion bill.

Senate Majority Leader Larry Pogemiller, DFL-Minneapolis, who has routinely gone toe to toe with Pawlenty in the past, endorses Kelliher's strategy. "People are starting to pick up on what's happening," he said. "She's taken this much further than we have in the past, and that's good."

As he waited his turn before Kelliher's panel, Revenue Commissioner Ward Einess said he and other agency chiefs have been instructed by Pawlenty to drop what they're doing and make themselves available whenever they're called in front of the commission.

"She's a worthy adversary and very good at what she's doing," Einess said, as Kelliher picked through the thicket of the public safety budget with Corrections Commissioner Joan Fabian one evening last week. "But the governor is very comfortable with his budget. If they want to have at us every day in an open forum, we're here."

Already, Hanson has had to acknowledge repeatedly that the governor's own budget demonstrates the need for an additional $1 billion in revenue -- money he obtains by selling bonds against state appropriations, with interest spread over 20 years.

Those are precisely the type of admissions that DFLers hope will make their case for pay-as-you-go instead of borrow-and-spend.

"This lets us take control of the situation a little more, instead of just waiting for the governor to call us," Kelliher said. It also, not incidentally, allows Kelliher, a frequently mentioned possibility for governor in 2010, to take a higher profile than typically is afforded the House speaker, who generally wields power in more subtle ways.

"It will get far more crowded in the room by midweek," Kelliher predicted with a Cheshire cat-like smile. "There's going to be a lot happening."

Patricia Lopez • 651-222-1288