Minnesota’s $6.2 billion budget deficit was revised this week to reflect a budget reduction of $1.2 billion, according to State Sen. Tom Saxhaug (DFL- Grand Rapids). While Sen. Saxhaug is cautiously optimistic, he is also realistic that difficult decisions remain to solve Minnesota’s $5 billion budget deficit.
With the new budget forecast released, Gov. Dayton promptly produced a revised budget and has reduced funding cuts to nursing homes, removed the temporary income tax surcharge on top earners to move Minnesota out of the top tax bracket, and offered a job-creation incentive to Minnesota businesses.
Gov. Dayton’s revised budget restores $70.8 million in funding for home and community based services, $10 million for rate reductions for seniors, $12.5 million for congregate living rates, and more than $7 million to nursing homes across the state. Gov. Dayton also restored an additional $10 million in funds to loosen waiver caps for people with disabilities to access services. “I was troubled by the deep cuts in the governor’s initial budget especially with cuts to area nursing homes,” Saxhaug said. “With the additional $1.2 billion forecasted, these common-sense funding restorations will help mitigate cuts to seniors and local nursing homes.”
According to Saxhaug, the next step is for the Republicans to release their budget proposal. “After two months of session and only three weeks from the finance budget deadline, Republicans have not released their plan to solve the $5 billion budget deficit,” Saxhaug said. “They are advocating for ‘no new taxes’ with an all-cuts budget. Unfortunately, we have seen what a ‘no new taxes’ budget looks like with property taxes rising in the last eight years by 75 percent or $3 billion and fee increases of nearly $4 billion.”
Sen. Saxhaug agrees with Tom Stinson, non-partisan state economist, who said the all-cuts budget Republicans are advocating for will do more damage to the state’s economy than a balanced solution that combines spending cuts with new revenue. “It is time to put the campaign rhetoric aside and get to work,” Sen. Saxhaug said. “Governor Dayton is willing to work with Republican leaders to balance this budget — it is time for Republicans to put their budget on the table, discuss and debate the options, and compromise on a balanced solution to move Minnesota forward.”