(Update) Gov. Dayton's budget cuts $171 million from higher ed

Hello, cuts

Here’s what MPR reporter Tim Post has on the higher-ed portion of the governor’s announced state budget this morning. A fuller, more general story by MPR’s Elizabeth Dunbar follows:

Gov. Mark Dayton’s budget cuts $171 million from the state’s higher education budget. Both the University of Minnesota and Minnesota State Colleges and Universities system see a 6 percent cut in what they thought they’d get this year. The budget sheds some smaller grant programs for savings as well, but Dayton said the State Grant Program is protected from cuts.

Dayton’s budgets cuts $18.2 million from smaller grants and programs administered by the state Office of Higher Education — yet Office chief Sheila Wright said it still preserves grants for needy students.

(Meanwhile, MPR’s Tom Scheck tweeted that House & Senate tax chairs said before the budget news conference that Dayton’s tax plan won’t get out of their respective committees.)

Some numbers Post provided:

The forecast budget for higher ed was $2.92 billion.

Actual proposed budget for FY 2012-2013: $2.75 billion

Expenditure reductions total $171 million.

New expenditures: 0

General overview of the budget:

Gov. Mark Dayton is proposing an income tax hike on Minnesota’s top earners to help solve the state’s $6.2 billion budget deficit.

The new top rate would be at 10.95 percent and apply to head of household filers with an after tax income of $130,000 per year and couples who earn more than $150,000 a year after deductions. There would also be a temporary 3 percent income surtax for those earning more than $500,000.

Adding a fourth-tier income tax would give the state the second-highest state income tax rate in the country, and the temporary surtax could make it the highest in the country.

Dayton, a Democrat, has also proposed cuts to long-term care and community based services, and 7,200 people will lose their state-subsidized health insurance.

Other cuts include a 6 percent reduction in the state government’s work force.

Dayton is proposing more money for early childhood and K-12 education, including $33 million to expand all-day kindergarten and $19 million for other programs such as an achievement gap innovation fund.

The governor also wants to protect aid to counties and cities, funding local government aid at $3.5 billion in the next two years. It’s more than what cities and counties are currently getting because of cuts former Gov. Tim Pawlenty made.