WALKER (AP) -- Residents here are worried about the possible closure of the state's only acute psychiatric nursing home, which could happen under Gov. Jesse Ventura's plan to fix a nearly $2 billion state budget deficit.

Ah-Gwah-Ching Center is one of several mental health treatment centers that would be closed under Ventura's plan. The state estimates it could save $5 million annually by moving its residents to a Brainerd center.

That would mean the loss of more than 200 jobs in Walker. More than half of the jobs would be eliminated because of redundancy.

"You just can't take over 200 jobs out of a community like ours, a small community, and not have a devastating impact," Mayor Brad Walhof said.

"This is the Fingerhut of northern Minnesota," said state Sen. Tony Kinkel, DFL-Park Rapids, whose territory includes Walker. "It's a $13 million payroll to this district."

The Ventura administration says the problem with Ah-Gwah-Ching is it's inefficient and too big. The 176-acre campus has 30 buildings. Most are either in mothballs or are being used by other agencies.

Ah-Gwah-Ching was built in the early 1900s. From 1907 to 1962 it served as a state-operated tuberculosis sanitarium. Now it's a nursing home of last resort for mostly elderly Minnesotans with behavioral problems and severe mental illness.

The center has about 152 residents. Some of them are able to shoot pool or participate in other activities. But many of the patients can be violent and haven't responded to treatment elsewhere.

Kinkel doubted the projected savings and said he believed closing Ah-Gwah-Ching would break a law passed two years ago protecting it from closure.

He also has asked Attorney General Mike Hatch to investigate whether the Department of Human Services has been turning away potential residents to shrink the center's population, making it appear too inefficient to keep open. Ah-Gwah-Ching has about half the population it had in 1990.

Doug Seiler, the regional administrator for state-operated services, rejected the allegation. An increase in community-based mental health services and the growth of assisted living facilities have absorbed some of the people who might otherwise have wound up at Ah-Gwah-Ching, he said.

A Senate plan to balance the budget includes funding to keep it open. The House hasn't decided yet. Testimony will be taken on the issue during a hearing Monday.