No rainy day use for stimulus money

If Minnesota is to spend federal stimulus money during fiscal years 2010-2011, current law regarding carryover funds must be changed.

Sponsored by Rep. Loren Solberg (DFL-Grand Rapids), HF886 would allow money remaining in the General Fund at the end of fiscal year 2009 to be appropriated in the next biennium.

Approved 89-40 by the House on Feb. 23, the bill, sponsored by Sen. Richard Cohen (DFL-St. Paul) passed the Senate Feb. 26 57-8. It now moves to the governor’s desk.

Current state law requires a surplus to be used for shoring up the state’s cash flow and reserve accounts, and paying back any school funding shifts. As part of the governor’s December 2008 unallotment to bring the current biennial budget into balance, the reserve account was depleted.

According to the nonpartisan House Research Department, the stimulus money changes federal Medicaid reimbursement to the state, possibly resulting in a positive General Fund balance at the end of the fiscal year. Federal law prohibits the state from using the Medicaid reimbursement for a budget reserve.

“This says we can accept the (federal stimulus) money, but it doesn’t need to go into the reserve account,” Solberg said. The change was requested by Minnesota Management and Budget.

House Republicans appeared to use the bill as a test to a change in House rules, whereby the House Rules and Legislative Administration Committee sets time limits for floor debate. Some called the rule change a way to gag the minority, while others said it will make for more informed debate.

Forty-five minutes had been allotted for the bill’s debate, but Republicans put forward 11 amendments, which took nearly two hours. House Speaker Margaret Anderson Kelliher (DFL-Mpls) allowed the debate to continue.

The only successful amendment came from Rep. Laura Brod (R-New Prague), and was further amended by Solberg, to require a budget enacted for the 2010-2011 biennium to provide for a balanced General Fund budget in fiscal years 2012-2013.