Budget deal still not reached, Dayton threatens veto on education bill

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UPDATE: Saturday 3:15 p.m.

The Minnesota House reconvened about 3 p.m. Saturday to begin working through the various budget bills that must be passed before the deadline of Monday at midnight.

Leaders of the House and Senate met for private negotiations over the past several days, and announced Friday night they had reached agreement on all major aspects of Minnesota's new, two-year $40 billion budget.

But Gov. Mark Dayton is unhappy with the education package put forward by the negotiators.

He said at a press conference Saturday morning that he is adamant he won't sign a budget package that features only an extra $400 million for E-12 education tentatively agreed upon by Republican House Speaker Kurt Daudt and DFL Senate Majority Leader Tom Bakk.

DFL leaders in the House released a letter Saturday afternoon saying they support the governor's position on the education funding issue.

Dayton himself wanted to put $700 million of the state's $1.9 billion budget surplus into E-12 education, but said he was willing to work with House and Senate leaders, offering a compromise $550 million.

He has threatened to veto any education bill that lands on his desk with only $400 million it.

To make this compromise, Dayton said he would reduce his plan to fund universal pre-K for 4-year-olds in the state's public schools, to a plan that provides half-day universal pre-K.

"I had $700m for E-12 education including funding for all-day pre-k, which is voluntary so any school district that doesn't want to do it is not required to," he told reporters. "I was at $700 million yesterday and they [Daudt and Bakk] came back with $400 million."

"I had come down to half-day pre-K and met them halfway at $550 million so we'll see what they do with that, but the indications are they are not prepared to find that common ground, so I'm not prepared to sign the bill."

The impasse has raised the specter of a special session next week if a deal can't be reached by midnight on Monday.

"If they want to go into special session that's their choice," Dayton said. "But we can get this done still with compromise on their part."

Other areas addressed by Dayton include the following:

Friday 10 p.m.

Republican House Speaker Kurt Daudt and DFL Senate Majority Leader Tom Bakk updated reporters outside the Governor's residence Friday evening.

They've spent most of the week there, meeting with Dayton, in hopes of forging a compromise budget agreement that can become law before midnight Monday. That's when the state constitution requires them to adjourn the 2015 session.

The leaders say they've reached agreements on most of the pieces of the budget and Daudt is confident lawmakers will be able to turn those deals into bills and pass them before Monday ends.

As the negotiators agree on bottom-line spending amounts for each of nine budget categories, those agreements are sent to the leaders of conference committees to turn them into legislation for the House and Senate to approve.

Two of those agreements were released on Thursday, but others may not reach the committees until Friday is turning to Saturday.

Daudt and Bakk spoke only in general terms about how the budget is shaping up. But they did reveal that a state program providing health insurance to low-income Minnesotans will not be eliminated, as House Republicans had wanted.

Bakk warned early this week that some priorities – notably tax cuts and transportation – might have to wait until next year's legislative session. DFLers and Republicans have been unable to agree on them, so the status quo may prevail for another year.

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