(Clips) Latest State Budget Forecast Offers Optimism

Minnesota's state budget will remain in balance through June 30, 2021, with an anticipated surplus of $641 million dollars. Despite projections for the FY 2022-2023 showing a deficit of $1.273 billion dollars, Governor Tim Walz and legislative leaders offered optimism as they responded to the latest economic news. Minnesota Management and Budget Commissioner James Schowalter, State Economist Dr. Laura Kalambokidis and State Budget Director Britta Reitan released their much-anticipated report Tuesday, December 1, via a remote video teleconference.

"Minnesota has managed our state budget well," said Schowalter. "We've made smart decisions preparing for an economic downturn and ensuring that our tax policies are able to withstand the unexpected. Our 'rainy day fund' is still at the highest level in our state's history, and if our forecast holds, we'll still be able to use it as a buffer for a projected shortfall in the next biennium or to provide more services to Minnesotans affected by both health and economic crisis caused by COVID-19."

Governor Tim Walz and legislative leaders addressed the media following the budget update, citing the work of Minnesota businesses and workers in adjusting to the pandemic. "The reason this is good [news] is because of the resiliency of Minnesotans," Walz said.

In looking forward, legislative leaders stressed the need to rebuild an economy devastated by the pandemic. "We know that the economic effects of the pandemic are not being felt equally, that lower wage workers, those that can afford it least, are bearing it the most," said Senate Minority Leader Susan Kent. House Minority Leader Kurt Daudt also said he remained optimistic. "Let's do the things necessary to make Minnesota the most business friendly place so that we can actually grow our way out of this," he said.