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State Representative Patti Fritz
100 Rev. Dr. Martin Luther King Jr. Blvd.
651-296-8237
For more information contact: Sandy Connolly 651-296-8877
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STATE BUDGET FORECAST PREDICTS MORE JOB LOSSES, FALLING STATE REVENUES Federal one-time money offers short-term relief
St. Paul, MN – Minnesota's projected budget deficit will hit $6.4 billion for the 2010-11biennium, according to the February budget forecast released today by the Minnesota Department of Finance. This follows on the heels of a $4.8 billion deficit announced last November.
When the one-time Medicaid money appropriated by the Federal Recovery Act is factored in, the deficit that will need to be resolved during this legislative session becomes $4.6 billion.
“We learned today that this recession is predicted to get worse before it gets better," said State Rep. Patti Fritz. “We will continue to lose jobs and our state revenues will continue to fall. Our next step is to begin the job of addressing the economic realities of this budget in as fair and open manner as possible.”
Fritz said that one thing that stood out in today’s forecast is the staggering loss of state revenue.
“Since November, state revenue has dropped by almost $1.2 billion,” said Fritz. “This shatters the myth that our state is struggling largely because we have a spending problem.”
According to Fritz, the forecast released today includes $1.8 billion in federal funding for a Medicaid match. This money offers a one-time buffer, as well as requires the Governor to adjust the health care cuts he included in his budget so the state qualifies for the federal matching dollars.
“I am relieved to know that over a hundred thousand adults may not lose their health insurance, as was the case in the Governor’s first budget,” said Fritz. “I also appreciate the efforts of both President Obama and the members of Congress; without these federal dollars, it is projected we would lose an additional 45,000 jobs.”
Fritz said the state has already lost 50,000 jobs and is projected to lose another 70,000 by the end of the next year. By contrast, when the economy is healthy, 40,000 jobs are added to Minnesota payrolls annually.
Overall, state economists predict the recession will be the longest and deepest since WWII, and may not start growing again until 2011 or 2012. Until then, the state legislature and the Governor will tackle the difficult job of crafting a budget that addresses this shortfall.
“Minnesotans will need to ask themselves some pretty tough questions in the coming weeks,” said Fritz. “Mostly, what are we willing to give up, and what are we willing to do to keep the things we value. The forecast today makes answering both of those questions more of a challenge."
News Items
- STATE REP. PATTI FRITZ PARTICIPATES IN START OF LEGISLATIVE SESSION - (Posted: Jan 9 2013 3:32PM)
- Rep. Fritz: Homeowners, Farmers Need Property Tax Relief - (Posted: 2012-05-01 00:00:00)
- Rep. Fritz: Let’s Vote on a Bonding Bill that Benefits All - (Posted: 2012-04-19 00:00:00)
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