ST. PAUL -- Rural and inner city communities would be hurt if Gov. Tim Pawlenty's property tax freeze plan is enacted, rural lawmakers say.
"Why should you always kick the dog at the bottom?" asked Sen. Keith Langseth after Pawlenty's fifth State of the State address Wednesday.
Langseth, DFL-Glyndon, and other rural lawmakers did not like the Republican governor's proposal to cap property taxes levied by local governments.
The dispute is a continuation of one that has gone on for years. Pawlenty had wanted to cap property taxes levied by local governments.
"Some oppose this idea by citing the need for local control," Pawlenty said in the speech before a joint session of the new DFL-controlled Legislature.
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The governor said he would offer a compromise by proposing that any local government that receives less than a third of its general fund revenues from the state be exempt from the tax cap.
"I certainly don't see it" as a compromise, House Majority Leader Tony Sertich said.
The Chisholm DFLer said much of the governor's speech was positive but that it included some "leftovers served up again," including the property tax proposal.
Many rural towns within DFL legislative districts operate with more than one-third of their budget coming from state aid, Sertich said, suggesting Pawlenty could be picking "winners and losers."
Rural legislators said suburbs, such as where Pawlenty lives, do not get heavy doses of state aid, but many poor rural communities do. Under Pawlenty's proposal, poor communities might not be able to raise enough property taxes to support local needs, the lawmakers say.
Rep. Frank Moe said that while he found much to agree with in the State of the State, capping property taxes didn't sit well with him.
"Saying we're going to cap property taxes after cutting state funds to local governments and school districts doesn't seem very productive," the Bemidji Democrat said.
Supporters said Pawlenty offered a forward-looking plan.
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The governor also discussed the need to improve the health-care system.
While it is a widely supported goal, ensuring that every Minnesotan has health care insurance would be too costly immediately, he said. Current law will allow 45,000 more people to seek coverage from state-subsidized health care, Pawlenty said. He proposed funding a program to expand coverage to all children younger than 21 in homes with a household income of $60,000 or less in a family of four.
Pawlenty said health-care costs must be contained. He proposes using private market ideas for state programs. He also wants to create an insurance exchange with lower premiums for uninsured Minnesotans.
"We're thankful that we're speaking the same language," Sertich said of Pawlenty's focus on education, property taxes, energy and health care.
But Sertich said DFLers want details of Pawlenty's initiatives. That will come when his full two-year budget proposal is released next week.
