The blue-ribbon bait-and-switch: Gov. Pawlenty ignores yet another of his reform commissions

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	The blue-ribbon bait-and-switch: Gov. Pawlenty ignores yet another of his reform commissions Bill Belanger, the former Bloomington Republican who served for more than a quarter-century and served for a time as the lead Republican on the Senate Taxes Committee, was a shrewd choice to introduce the Governor's 21st Century Tax Reform Commission report to the Senate Taxes Committee on Wednesday morning. After bantering with his former colleagues by name for a moment, Belanger, who worked with 14 other reform commission members for more than six months assembling the report, got down to business. The commission's process of analyzing the state's tax system "has not been political and it has not been partisan," Belanger stressed, adding that the commissioners were "all experts in the field" and not from "law firms or other hired guns" frequently deployed to lobby policy. The commission had come up with a program to address "the 21st Century, service-based economy." Putting an edge on his congeniality, Belanger then delivered his closing argument. The commission's recommendations needed to be adopted "in totality, not in stages." Cherry-picking what some people liked or didn't like would disrupt the panel's comprehensive approach, he continued, and trying to phase in different components would make legislators lose ownership of the plan and lessen its commitment. When Belanger was finished with his remarks, DFL Taxes Committee chair Sen. Thomas Bakk (DFL-Cook) leaned into his microphone and gently needled his former colleague. Governor Pawlenty-the person who appointed the commission in the first place-had apparently dismissed the commission's recommendation for raising and broadening the state sales tax to pay for its elimination of the corporate income tax. "Does that mean the governor wants to cherry-pick the recommendations of the commission?" Bakk asked. The governor has incorporated a lot of the commission's recommendations into his budget priorities for this legislative session, Belanger rejoined, then conceded the argument as his final, incomplete sentence trailed off into silence: "But his no new taxes...." In the first few weeks of his first term in office back in 2003, Gov. Pawlenty appointed former Republican U.S. Senator Dave Durenberger to lead the Minnesota Citizens Forum on Health Care Costs. A pattern was established that continues to this day. Politically friendly experts hand-picked by the governor labor long and hard to arrive at a reasonable and relatively comprehensive solution to the proposed problems-in the Durenberger group's case, containing the runaway cost of health care-and the governor rejects or ignores their recommendations, usually because the results point to needed statewide tax increases. The Durenberger panel suggested a tax on cigarettes to mitigate the financial burden of health care. Pawlenty instead used what he labeled a "fee" on smokes to balance the gaping deficit in his general fund budget. But since that time, although he has endorsed and even encouraged policies that knowingly spike local property taxes, add to the state's debt load, or pile billions of dollars' worth of fees on consumers, Pawlenty has never agreed to another increase in state tax revenues. This is true even when those tax increases are recommended by commissions that he himself has assembled and touted as vital to the process of reforming state government. Pawlenty created another blue ribbon commission during his first year in office: the Governor's Task Force on Education Funding Reform. Nineteen members met nine times over seven months to hammer out what became a pretty solid framework for determining what it costs to educate a student in Minnesota. But Pawlenty turned his back on the task force report, issued in July 2004, and refused to utilize the framework as a blueprint for reforming education funding in a fair manner, the ostensible charge of the task force. Instead, he cherry-picked some of its remarks with regard to accountability to come up with gimmicky, high-concept proposals to mandate that at least 65 percent of the funding be devoted to classroom learning (when he discovered the schools were already reaching that goal under his criteria, he later raised it to 70 percent). Be it his ill-fated "Successful Schools" initiative or his more lauded Q-Comp program for teacher training, his attempts at education reform have been piecemeal, ignoring the systematic, broad-based parameters outlined by his task force. It has been left to legislators and education groups to pick up the ball, first through P.S. Minnesota and now in the so-called "New Minnesota Miracle" legislation that the governor is almost certain to veto (if it passes the Legislature) due to its cost. Then there was the governor's Health Care Transformation Task Force, named in June 2007 and chaired by Pawlenty's own Commissioner of Health and Human Services, Cal Ludeman. As with the others, more than a dozen experts met numerous times without recompense to tackle sophisticated, relatively intractable problems and recommend solutions that were comprehensive and coordinated enough to seriously address the issue. Once again, Pawlenty chose to highlight and isolate what he liked about the group's report, issued in January 2008, while dissolving the coordinated framework for a solution by rejecting a tax increase on cigarettes that would help pay for the plan. Three weeks after the task force gave its report, Pawlenty was approvingly citing it in testimony to the U.S. Congress. A bare bones version of the task force's vision made it through the last legislative session, but Pawlenty's current budget proposals already recommend dismantling the rudimentary funding to get it established. Now comes the latest blue-ribbon bait-and-switch: the Governor's 21st Century Tax Reform Commission report. Pawlenty announced its creation with great fanfare during his 2008 State of the State speech. For this and other reasons (and contrary to Belanger's assertion before the Taxes Committee), the reform commission was widely suspected of political and partisan by DFLers. As chair, Pawlenty named Michael Vekich, a longtime political ally and campaign contributor. In addition, a third of the 15-person panel contained prominent contributors to the campaigns of Pawlenty and other Republicans. Despite this potential bias, the commission determined that if it were to heed Pawlenty's charge to them-that anything they recommend be revenue neutral to the state budget-a broadening and raising of the sales tax was required. Faithful to the pattern he has set, Pawlenty ignored this call for a sales tax increase to accomplish the commission's stated objective. He ignored the commission's recommendation that the proposal be implemented wholesale, instead recommending a phase-in of the corporate income tax cut. To pay for it, the governor would eschew a sales tax increase and instead borrow money on future receipts paid to the state by tobacco companies. Or perhaps he would argue that he will make up the $1.2 billion in corporate tax cuts and other business incentives (members of both the reform commission and the tax committee agreed that was a reasonable price tag for the measure in the coming biennium) by reducing health care eligibility, or postponing school aid payments. In any case, his budget still lacks any stable, ongoing means of supplementing this ongoing proposed reduction in the state's general fund. At the conclusion of Wednesday's hearing, tax committee chair Bakk said he believes that "a bill phasing out the corporate income tax and replacing it with other tax options" will come before his colleagues later this session. What fills in the gap of a billion-dollar tax break for corporations at a time when the state is already staring at least $5 or $6 billion in red ink? That question promises to be a contentious issue in the coming weeks. But the solution proposed by the Governor's Task Force has been effectively diminished by the governor.