Minnesota budget experts: July government shutdown costs, savings essentially a wash

Photo:

Nov 22, 2011 at 12:06 am

ST. PAUL (AP) — Minnesota budget officials say a 20-day government shutdown in July cost the state nearly $60 million but saved it about $65 million in salaries that weren't paid to state employees.

The report issued today says Minnesota lost almost $50 million in revenue. It estimated preparation costs at about $7 million and recovery costs at $3 million, and said those costs could rise.

But the state saved about $65 million in salaries that were not paid to about 22,000 state employees during the shutdown.

The report did not include lost productivity and other, unspecified "indirect impacts." The shutdown angered and inconvenienced many Minnesotans, delaying road construction projects, shutting down state parks and the lottery and cutting off the flow of alcohol to some bars.

Budget Commissioner Jim Schowalter said that except for those state employees, the shutdown was essentially a wash because a court-appointed master ordered that many programs were essential and had to be funded during the shutdown. State spending continued at an 80 percent clip.

"The broad economic impact didn't really occur," Schowalter said. "The biggest story was the human impact, and the impact on the state's reputation."

The shutdown came after Democratic Gov. Mark Dayton and GOP legislative majorities couldn't agree on how to close a $5 billion budget shortfall.

Posted By KNSI News

KNSI News's Profile

Leave a Comment