ST. PAUL – The state issued a new economic forecast Wednesday, projecting a $616 million surplus through the 2026-27 biennium – a decrease of $1.1 billion from previous estimates – and a significant future shortfall.
The new economic report from Minnesota Management and Budget indicates reductions in income and sales tax revenues combined with higher spending for long-term care and special education result in a growing potential shortfall in the future. It also reveals a deficit of more than $5 billion through the 2028-29 biennium.
State Rep. Shane Mekeland, R-Clear Lake, said this underscores the need for balance after Democrats in St. Paul spent the state’s surplus that once was near $21 billion, raised taxes by $10 billion and increased the state budget by 40 percent with the budget they set in 2023.
“With full control of the Capitol, Democrats went on such a reckless spending spree they have us staring at a shortfall because even their $10 billion tax increase isn’t enough,” Mekeland said. “They even gave illegal aliens free health care and free education – all funded by hardworking taxpayers. Republicans will bring a more balanced approach after gaining equal power in the House. We’re serious about rooting out fraud Democrats have allowed to run rampant and will stop to the automatic spending increases that have bloated our government. Minnesotans deserve nothing less and that’s what we will work to deliver.”
An updated February forecast will serve as the official framework for the 2025 session as legislators work to craft a new two-year state budget before adjourning in late May.
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