It seems like a battle of numbers. A $466 million deficit. A $29 billion budget. Increased spending here. Cuts there.

But the battle at the Capitol is really over priorities and principles, unions say, as Gov. Tim Pawlenty and the Legislature craft Minnesota's spending plans for the next two years.

The Minnesota AFL-CIO says it's time for elected officials to quit pitting one group against another, and instead to solve the structural problems causing the state's ongoing budget deficits.

In short, the AFL-CIO says, that means replacing a mentality of scarcity and "no new taxes" with a fair revenue structure based on ability to pay ? a first step toward fixing the budget with integrity and raising the necessary revenue to support K-12 and higher education, health care, public services, and investment in the state's future.

Unions are not backing a specific approach for restoring lost revenue, but argue that all sorts of options should be considered, including increasing cigarette and gasoline taxes, closing corporate tax loopholes, imposing short-term income-tax surcharges, and reversing cuts in tax rates made during the 1990s, especially on higher-income households.

Pawlenty's budget proposal, on the other hand, tries to patch the problem entirely through service cuts, more "fees," accounting shifts and gimmicks, the AFL-CIO says. It cuts workers off health care, child-care assistance, and other human services; doesn't give schools the money they need; and further short-changes state and local public services, eliminating more jobs and threatening public employees with two more years of wage freezes and higher health costs.

Further, the AFL-CIO says, Pawlenty's approach does raise taxes ? especially by shifting costs onto property taxes.

As the Legislature heads toward a May 23 adjournment, committees are wrestling with omnibus finance bills headed to the floor for final votes. Here's a rundown on some of what labor is paying attention to.

Transportation
A variety of proposals use a combination of funding sources ? the gasoline tax, bonding, the motor vehicle sales tax, license tab fees or new regional sales taxes ? to support additional roads, bridges and mass transit. None of the plans, however, provides anywhere near the funding needed to support public transportation in the long run, says Ron Lloyd, president of Transit Workers Local 1005.

Lloyd favors a plan that would provide guaranteed funding for the next 15 years by dedicating sales tax revenue to transit statewide.

The need for secure funding is urgent, he says; Metro Transit alone faces a $60 million budget deficit. To erase that, Metro Transit wants to wipe out some routes entirely and, overall, impose cuts on nearly 70 percent of the system's routes. Those cuts would eliminate as many as 1,100 jobs, Lloyd says. The leading House bill actually cuts state aid to public transportation; the Senate bill patches Metro Transit's $60 million hole for the next two years, but does little beyond that.

Health care
The Minnesota AFL-CIO's main priority ? a state constitutional amendment that would guarantee health care for all state residents ? won't get a hearing until the next legislative session.

In the meantime, unions are:

? Fighting plans by Pawlenty to cut 47,000 working adults off Minnesota Care and significantly reconfigure the state?s commitment to health care.

? Pushing the Health Care Disclosure Act, which would require Minnesota to track and publish which employers are freeloading off state taxpayers by letting their workers rely on state-subsidized health care. In a dozen other states where this information is gathered, Wal-Mart is the leading recipient of this form of corporate welfare.

? Seeking the creation of a statewide health insurance pool for schools. Education Minnesota and other unions representing school workers say the pool could reduce costs and improve coverage options, though some smaller union locals dispute that.

? Monitoring a bill that would transfer governance of Hennepin County Medical Center from public control to a "public benefit corporation." Initial revisions preserved the status of HCMC workers as public employees, but also restricted the ability of some employees to unionize or bargain collectively.

Nursing homes
Both the House and Senate seem ready to increase funding, after freezing support for two years. That freeze, says SEIU's Kristin Beckmann, has contributed to staff shortages; stagnant pay for workers; and the closing of some nursing homes.

Current proposals would increase state support by 2 percent each year. The Senate dedicates the entire 2 percent to pay raises to front-line staff; the House does not. Unions that represent nursing home workers ? AFSCME, SEIU, UFCW, UNITE HERE and USW ? say that means little, if any, new money could wind up in workers' pockets.

Minimum wage
Bills raising the state minimum wage from $5.15 an hour passed the full Senate Feb. 3 and the House Commerce Committee April 6. However, the full House has been dodging a vote.

The Senate would raise the minimum to $7 by July 1, 2006; the House would raise it to $6.65. Both retain the practice of setting lower minimums for small employers and for teenagers in their first 90 days on the job.

The state estimates more than 213,000 workers currently make less than $7 an hour. "Raising the minimum wage not only is the right thing to do," says Brad Lehto, legislative director for the state AFL-CIO, "but historically, it also has created upward pressure on everybody else's wages, too."

Tip penalty
Foes of a higher minimum wage also are pushing to exclude employees who work for tips. Statutes call this a "tip credit," but unions call it a "tip penalty," because it hurts restaurant servers and others who rely on tips by allowing their employers to pay them a subminimum wage.

Building Trades
With a bonding bill signed and transportation improvements receiving more than lip service, Building Trades unions now are focusing on:

? Penalizing employers who illegally classify workers as independent contractors, rather than employees, a practice that puts union contractors at significant cost disadvantages.

? Blocking a statewide study of prevailing wage rates, which construction unions fear would be used to justify reducing wage standards.

? Overturning a Department of Administration decision to replace the state's uniform mechanical code with weaker international codes.

? Creating tax credits for buildings with high energy efficiency.

? Supporting a University of Minnesota football stadium on campus.

Other items
Unions are also:

? Opposing a reduction in the rate employers pay for dislocated worker training. The rate, now 0.1 percent, drops to 0.07 percent on Jan. 1, which Lehto says would cut $13 million and deny training for some laid-off workers.

? Opposing a constitutional amendment, which passed the House April 14, to establish initiative and referendum in Minnesota. It sounds like a good idea in principle, Lehto says, but experience in other states shows it frequently becomes a tool for wealthy front groups to pursue anti-union initiatives and other items on the right-wing wish list.

? Opposing legislation that would allow local units of government to "opt out" of state mandates. Unions say the opt-out option could gut requirements for collective bargaining, prevailing wages, pay equity, unemployment insurance, health and safety protections, and other state statutes.

Labor also is supporting resolutions in which the Legislature requests the state?s Congressional delegation to:

? Oppose privatizing Social Security.
? Vote against the proposed Central American Free Trade Agreement.
? Fund Amtrak adequately.
? Oppose attempts at "postal reform" that would eliminate universal service, eliminate collective bargaining rights for postal employees, or drop guaranteed postal employee benefits from federal law.

Adapted from The Union Advocate, the official newspaper of the St. Paul Trades and Labor Assembly. E-mail The Advocate at: advocate@mtn.org