MN - Deal or no deal? Clock ticks toward midnight deadline

05/21/2007

By Patricia Lopez, Pat Doyle, Norman Draper,
Star Tribune
May 21, 2007


The final details of a budget agreement among legislative leaders and Gov. Tim Pawlenty remained just out of reach early this morning, despite nearly round-the-clock meetings, as House and Senate lawmakers held floor sessions into the night.

The issues were those that have kept leaders inches apart for days: the level of spending for schools, health and human services, property tax relief and roads and transit.

The framework of a deal began to emerge shortly before 1 a.m., revolving around a possible Republican concession on collecting more money by tightening corporate tax shelters, while DFLers considered preserving some gubernatorial initiatives on schools, health care and economic development.

Rep. Ann Lenczewski, DFL-Bloomington, said the compromise on corporate taxes by legislative conferees would likely include a reduction in a tax loophole for corporations with foreign operations, a key concession sought by DFLers. The governor had resisted the reduction in the loophole unless it was linked to other tax breaks for business.

Senate Majority Leader Larry Pogemiller said early this morning that the compromise would generate about half of the $244 million that DFLers had sought in shrinking the loophole.

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