Layoff notices to 9,500 sent out earlier in the day

ST. PAUL — Gov. Mark Dayton and majority House Republicans came to a tentative deal Monday on education funding, the largest unresolved piece of the state budget fight that has pushed Minnesota toward a potential government shutdown.

Some of the finer details on the schools plan and a couple of other plans must be fully resolved before Dayton will call a special session for legislative ratification. But he said the progress should give comfort to some 9,500 workers for whom layoff notices were mailed out earlier in the day in the event the budget stood incomplete on July 1, the start of the state’s budget year.

“I have no intention to see this go to a June 30th showdown and possible shutdown,” Dayton said. “I’m not going to subject people to that.”

The Democratic governor and top House GOP lawmakers had been at odds for weeks over how much new money to provide public schools. After holding out for more, Dayton said Monday he’d accept Republicans’ latest offer to put up another $525 million for early childhood through high school education.

Earlier in the day, Dayton’s administration took the first concrete steps toward the partial government shutdown, which would be Minnesota’s third such stoppage in a decade.

The Department of Minnesota Management and Budget mailed out 9,451 layoff notices to employees at agencies covered by incomplete budget legislation. Commissioner Myron Frans said the state has activated a contingency response team and will notify some vendors or grant recipients next week that their payments could be suspended starting July 1.

Besides education, there were also differences on how to structure budgets for the departments of agriculture, natural resources and some other operations. Should the shutdown happen, state parks could be closed and job training centers might also go dark.

Just as in the 2005 and 2011 partial shutdowns, a court could be asked to declare some state functions critical in order to keep the money flowing and require a small contingent of employees to stay on the job at affected agencies. That could include workers who send payments to schools or are involved in the bird flu response.

Anxiety has started to set in for the state employees who would be sidelined. Angela Byrne, a financial analyst in the Department of Commerce energy division, said any work stoppage would be difficult.

“My bills will not go away just because my paycheck does,” said Byrne, the mother of a seven-month-old boy who recently added day care to her household expenses.

Byrne, whose hire was delayed because of the 2011 shutdown, said she remained hopeful lawmakers will strike a deal. But she recently warned her husband of the impending unwelcome mail: “I had to tell him when he gets the mail, ‘Don’t panic when you see my layoff notice.”’

Last week, Lt. Gov. Tina Smith visited most of the affected agencies to address employees about who could be laid off.

“I cannot emphasize enough the urgency they feel,” Smith said Friday. “For them, this is not a political problem. This is a personal problem.”

Republican House leaders pressured Dayton to strike a deal on public school funding with an offer that matched the governor’s own late-session proposal. It’s the same proposal that top House GOP lawmakers made last week, minus a controversial teacher tenure policy change.

Dayton said Friday he’d hold out for at least $550 million, noting that lawmakers finished their regular session with $1 billion in reserve for a debate over tax cuts and transportation funding next year.

Dayton said he is still insisting that lawmakers rescind a new policy that gives counties more power to hire private firms rather to review their finances, bypassing the state auditor. Daudt said making that change could be a minor sticking point.

Dayton also said he wants clear agreement on all remaining bills before he orders a special session, but added that he hopes it can be held later this week or next week.

On the whole, Daudt said, “I think we’re there.” And Senate Majority Leader Tom Bakk, a Democrat, issued a statement of support for the pending agreement, saying that “shutting down state government is not the responsible way to resolve these negotiations.”