UPDATED 1:45 p.m., Friday, Feb. 27
Senators reacted positively to the $1.86 Billion February Forecast, a number which has nearly doubled since November’s forecast. The non-partisan office of Minnesota Management and Budget (MMB) releases the February Forecast each year as a more accurate indicator of the budget and economic forecast for Minnesota. Previous indicators released earlier this year suggested that the state would have a budget surplus of roughly $1 billion; the increase is a more accurate depiction of the state’s fiscal resources, and proof that a DFL-controlled legislature and DFL Governor were good and responsible stewards of our state.
As the third consecutive surplus for the state, the February Forecast is yet another sign that the budget reforms led by DFL leadership in the 2013 Legislature have continued to contribute to a more stable and healthy economy. Without the investments of the previous two years to right the fiscal ship, such an optimistic forecast would be impossible. With the updated numbers now released, the budget for the upcoming biennium will draw into closer focus. Much of the remaining session will center on negotiations between the DFL-controlled Senate and the House Republican caucus, as they debate how best to use what resources are available to Minnesota, with input from Minnesotans around the state.
The one-time surplus is a great sign of positive economic momentum, but fiscal experts still warn that without additional long-term investments, transportation funding remains in dire shape. Both parties agree that some tax credits would be appropriate, so all Minnesotans can celebrate the fact that our state continues to maintain a stable budget after over a decade of financial mismanagement. A 2014 law requires that 33% of the November forecast is deposited into the state’s rainy day fund, meaning that $183 million was deposited this year; if our state faces a crisis in the years to come, we will be better positioned to weather it. Between this reserve and a state budget that has finally been stabilized, this forecast show how the honest budget passed by the DFL legislature, without gimmicks or borrowing, has created the confidence and stability necessary for Minnesota’s economic growth.