An updated forecast released Monday puts Minnesota’s surplus at $17.5 billion, representing an overall improvement in the state's fiscal picture.
While the figure from Minnesota Management and Budget is down slightly from the $17.6 billion that the agency projected in November, the forecast now factors in the impacts of inflation on state spending for the first time in 20 years.
“This is a good forecast,” said Minnesota Governor Tim Walz. “This is a positive affirmation about the economy in Minnesota.”
The new figure also accounts for a little over $100 million that the Legislature already has spent since it convened last month, mostly on bringing the state tax code into conformity with federal regulations and deductions, which resulted in a tax cut for many residents.
“We are seeing gridlock come to an end,” Walz said. “You know 12 billion of that should have been handled last May, but a political decision to use messaging over what was good for Minnesota was made and we ended up going home.”
Republicans responded to the surplus as well.
House Minority Leader Lisa Demuth (R-Cold Spring) issued the following statement regarding the release of the state's budget forecast which shows a $17.5 billion surplus.
“The difference in the forecast from January to February was pretty much nothing. While inflation hasn’t hurt government tax revenue, it has significantly hurt Minnesotan’s buying power. It’s time to get serious about giving the surplus back to the taxpayers so they can afford their lives in the face of historic inflation driving up the cost of basic necessities. We are rolling out our tax cut plan tomorrow because we know it’s never too early to give the money back.
“Sadly, the plans we’ve seen from Democrats are the same too: they want to spend it all. We have finished eight weeks of legislative activity without major tax relief for Minnesotans, but spending and divisive policies are moving quickly through the Democrat-led legislature to reach the Governor’s desk. It’s clear Democrats' priorities do not include helping everyday Minnesotans manage inflationary costs, but are focused appeasing their liberal allies and special interest groups first.”
Republican Party of Minnesota Chairman David Hann issued the statement below on the latest state revenue forecast.
“Yet another announcement shows Minnesota has a record-breaking budget surplus of more than $17 billion. How many more times do Minnesota taxpayers need to be reminded that they are massively overtaxed, and state government is flush with their hard-earned cash? Yet the extreme Democrats continue to push the same old reckless tax-and-spend agenda – even proposing to commit one-time surplus revenue to recurring, permanent spending increases, which they will use to call for tax increases with any future deficits. The Democrats’ view of the surplus is downright irresponsible.
“Enough is enough. It is time for real, permanent tax relief to give more Minnesota families and businesses more of their hard-earned money back – for good. Thankfully, Republican legislative leaders will propose their ‘Give it Back’ plan – which includes permanent tax relief for Minnesota’s seniors, workers, property owners and parents. I applaud our Republican lawmakers for this sensible proposal to help Minnesota taxpayers get out from under the weight of the Democrats’ reckless fiscal policies.”
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