Pawlenty budget proposal includes casino money

Patricia Lopez and Dane Smith, Star Tribune
January 25, 2005 BUDGET0126

Minnesota would spend more on schools but would slow the growth of health care spending and significantly expand gambling with an Indian-run, metro-area casino to help put its books in the black and possibly fund a stadium, under a budget proposed by Gov. Tim Pawlenty on Tuesday.

To erase a $700 million projected deficit for 2006-07 and fund new spending, Pawlenty would cut the number of people eligible for MinnesotaCare, the state's subsidized health insurance program, keep liquor and car rental taxes where they are instead of allowing them to drop, boost traffic ticket surcharges $10 -- to an average of $75 per ticket -- and make myriad small cuts to programs in virtually every state agency.

Pawlenty noted that his overall budget would increase state spending by $1.6 billion -- 5.8 percent -- over the current biennial budget to just under $30 billion, and would increase funding to K-12 schools and higher education.

"This is a budget we're proud of," he said at a news conference on Tuesday.

Much of his presentation was devoted to outlining Pawlenty's "Gaming Fairness Proposal," which would have participating Indian tribes operating a metro-area casino in partnership with the state. The Minnesota Lottery would operate the slot machines, but the tribes would build, pay for and own the casino itself.

Pawlenty noted that part of the state's share would go into a "Community Assets Account" that would be used "to fund facilities for professional or college sports, the arts or other community priorities."

An executive summary of the budget didn't identify the tribes. The governor earlier mulled a project that might include the White Earth, Red Lake and Leech Lake tribes, all in far northwestern Minnesota.

``We've seen explosive growth in Minnesota's tribal casino industry over the past 15 years,'' Pawlenty said in the summary. ``That growth has not benefited 85 percent of tribal members, nor the state as a whole. Numerous other states have re-examined their gaming agreements to ensure greater fairness and it's time for Minnesota to do the same.''

The $200 million would come from a one-time licensing fee. Starting in 2008, the state could expect $100 million each year from the casino, according to the budget summary.

The idea was immediately criticized by the Minnesota Indian Gaming Association, a group that includes all of Minnesota's bands except for Red Lake and White Earth.

``The governor's scheme to involve three northern tribes in a metro-area casino is nothing more than a cynical effort to create disunity among tribes and use the poorest Indians in the state as human shields to protect him from the political fallout of gambling expansion,'' the group said in a statement.

Pawlenty's proposed two-year budget is a 5.8 percent increase over the current budget, slightly more than the rate of inflation. It includes $426 million in spending cuts and $476 million in new spending.

Pawlenty had to account for a $700 million state deficit in crafting the proposal, and the administration was conducting an afternoon briefing to detail the plan. The proposal serves as a starting point for the Legislature.