Image: Minnesota Gov. Mark Dayton signs budget bill
Eric Miller  /  Reuters
Minnesota Gov. Mark Dayton is handed a bill to sign that will eliminate the state's $5 billion budget deficit and reopen state government and services that have been shut down for three weeks, in St. Paul, on Wednesday.
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updated 7/20/2011 10:53:43 AM ET 2011-07-20T14:53:43

Minnesota Gov. Mark Dayton signed a new budget Wednesday, ending the nation's longest state government shutdown in the past decade.

Dayton's signature came just hours after lawmakers gave their own approval to the deal after meeting in special session that started Tuesday afternoon and lasted until early Wednesday morning. All sides formalized an agreement that Dayton struck with leading Republicans late last week.

Video: Aftershock of shutdown ripples across Minnesota (on this page)

The two sides argued bitterly over taxes and spending for months. When government shut down July 1, it closed state parks and rest stops, laid off 22,000 state employees, stopped road projects and much more.

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The end to the shutdown began when Dayton moved last week to accept a borrowing plan offered by the GOP shortly before the stoppage began.

After signing the budget, Dayton said he was "not entirely happy" with it.

"It's not what I wanted, but it's the best option that was available and would be for any time," he said. Dayton said the budget "gets Minnesota back to work."

Details were still emerging Wednesday about how quickly state operations would restart.

Video: Minnesota is shut down (on this page)

A day earlier, Tina Smith, Dayton's chief of staff, told reporters that state employees would get 24-hour notice before reporting back to their jobs.

Jim Schowalter, the state's budget commissioner, added that it will take longer to restart some state agencies than others since some have continued partial operations during the shutdown. He predicted it would take weeks for agencies to work through paperwork backlogs, clean up parks and other sites and return to normal operations.

"There is a backload of work," Schowalter said. "There is a backload of issues that are going to have to be addressed."

His division had earlier estimated that the state was losing millions of dollars, including lost revenue from lottery sales, tax audits and state park fees, money spent preparing to shut down and the cost of unemployment and health benefits for laid-off workers. The full cost wasn't expected to be known for some time.

Video: States face own budget crises (on this page)

The budget was widely panned for setting up a new problem down the road. It borrows money from schools and from future payments on a legal settlement with tobacco companies to erase a $5 billion deficit through mid-2013. Republicans and Democrats have been at odds for years over how to address persistent deficits, with GOP leaders pushing for deeper spending cuts and Democrats arguing for new taxes.

It includes slightly more than $1.3 billion in new revenue from delaying $700 million in state aid checks to schools and borrowing $640 million against future payments from the tobacco settlement. The budget also continues a previous delay in school payments worth $1.4 billion and eliminates the rest of the shortfall through cuts in projected spending.

Minnesota became a national example of political dysfunction, mirroring in miniature the partisan standoff in Washington over raising the debt ceiling. State leaders are more accustomed to being recognized for efficiency and innovation.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Video: Aftershock of shutdown ripples across Minnesota

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