At the end of February, Minnesota Management and Budget (MMB) reported the projected budget surplus is $329 million for General Fund in Fiscal Year 2018-19. Based on this number, the Legislature and Governor Dayton propose their respective supplemental budgets.
This week, Governor Dayton released his supplemental budget recommendations. The Governor’s proposal will use $206 million of the forecasted $329 million for the priorities he believes are important for the state and leave $122.86 million unspent. His investments include $62 million in General Fund resources for infrastructure, senior care, and the opioid crisis. An additional $78 million is provided for educational priorities, including safe and secure schools, mental health, special education, and college tuition relief.
Much of this session’s resources will likely be dedicated to a response to the federal tax bill passed late in 2017. Governor Dayton’s tax budget includes new tax cuts for 1.9 million Minnesotans and makes other adjustments to prevent the federal changes from causing a tax increase for Minnesotans. In addition, the Governor proposes reversing some unsustainable tax cuts passed last year that benefited the wealthiest Minnesotans, tobacco companies and corporations. Reinstating the inflator on the state general levy and tobacco taxes, restoring the tax on premium cigars, and freezing the estate tax exclusion to $2.4 million helps pay for tax cuts for families, small businesses and farmers. (A full explanation is included in a separate tax article.)
Additional information on the Governor’s budget proposal is available on MMB’s website.