Day 7: Government Shutdown Costing State Millions
The state of Minnesota’s Government shutdown has now reached it’s 7th day. While the state’s political leaders continue to argue over taxes and spending proposed in the budget for the next two years, the state is losing millions of dollars.
An already cash-strapped Minnesota stands to lose tens of millions of dollars in the nation’s only state government shutdown. For example, lottery tickets aren’t being sold, and 22,000 state workers who have been laid off collect unemployment and health benefits.
The government interruption also threatens to slow an already sluggish economy, as everyone affected immediately begins tightening their spending. Of course, this creates problems for small business, and the spiral continues.
The politicians are arguing about how to erase a $5 billion deficit. Republicans who run the Legislature want to cut projected spending to match the amount of revenue the state will collect over the next two years. Gov. Mark Dayton hopes to avoid some of those cuts by raising income taxes on the highest earners; Dayton campaigned on raising taxes on the wealthy, but has also said he’s willing to consider other ways to bring in new revenue.
Budget talks continued on Wednesday, but no real progress is being made. Gov. Dayton’s latest offer asked Republicans to choose between a temporary top-tier income tax increase or a $1-a-pack cigarette tax hike; they said they’re not interested in either. No further talks were scheduled.
State officials won’t be able to calculate the shutdown’s full cost until it’s over, but they have released the following figures estimating some of the biggest losses: $1.25 million a day on the lottery, $1 million a week on state parks, $52 million a month in uncollected tax revenue that state auditors would have brought in.
State parks are losing $1 million a week in camping fees, park passes, concessions and gift shop sales, according to the Minnesota Department of Natural Resources.
The state Transportation Department is losing $40,000 to $50,000 a week on passes to use express highway lanes.
Laid-off state employees are eligible for half their pay in unemployment and the state’s share of their health insurance costs. State agencies will be billed for the estimated $8.5 million weekly cost of unemployment once the shutdown ends.