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. Bernie Perryman, R-St. Cloud, said this underscores the need for balance after Democrats in St. Paul spent the state’s $18 billion surplus, raised taxes by $10 billion and increased the state budget by 40 percent with the budget they set in 2023.
“One-party control of the Capitol has caused Minnesota to suffer unchecked spending, unnecessary tax increases and rampant fraud,” Perryman said. “Now, we are left picking up the pieces after they turned an $18 billion surplus into a projected shortfall in the blink of an eye. The good thing is we will have more balance in St. Paul with an even split of power in the House for the next biennium. The high level of partisanship we’ve seen the last two years now will have to take a back seat. I look forward to working with my colleagues across the aisle to do good things for all Minnesotans, including putting an end to the fraud and waste that continues costing taxpayers dearly.”
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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