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State Representative David Bly
100 Rev. Dr. Martin Luther King Jr. Blvd.
651-296-0171
For more information contact: Michael Howard 651-296-8873
Press/News Releases
BUDGET FORECAST REVEALS GROWING STATE BUDGET DEFICIT
ST. PAUL – The projected state budget deficit has grown to $6.4 billion for the upcoming biennium according to the economic forecast released today by the Minnesota Department of Finance. The recently passed Federal Recovery Act will help cushion the deficit with one-time resources, leaving a still massive $4.6 billion deficit.
“The economic forecast reveals what people in Northfield already know – the national economic recession is causing significant harm," said Bly. “We need to pursue an aggressive timeline over the next months to answer the difficult questions and make the tough choices required to close our budget deficit and get Minnesota back on track.”
Bly said that most troubling news included in the forecast was the report on expected job losses and its ripple effect on the economy and state budget. State economists are predicting 120,000 more job losses by 2010, which equal about 3 years of average job growth for Minnesota. Over 20,000 jobs were lost in January alone, which was a leading cause in the steep increase in the budget deficit since the last economic forecast in December. Since then, state revenue has dropped by almost $1.2 billion.
“For state revenue to drop by over $1 billion in 3 months sends up a serious red flag about the trajectory of our economy and scope of our budget problems,” said Bly. “We have a serious revenue problem in this state that won’t go away until we find a way to get Minnesotans back to work.”
Bly said state economist estimate the federal recovery dollars should help create about 45,000 jobs, but said those job additions were already included in the projections that estimate 120,000 more job losses by 2010. The federal recovery will also include $1.8 billion in one-time resources, which bring the state budget deficit from $6.4 billion to $4.6 billion. However, Bly said that while helpful in the short term, the recovery dollars do nothing to address long term challenges.
“The federal recovery bill doesn’t change the job or responsibility of the Legislature this year, which is to pass a balanced budget that considers both the short and long term challenges facing our state,” said Bly. “It’s not going to be easy, but the forecast gives us a clearer idea of the challenges ahead. Now it’s time to really get down to brass tacks to work towards the best possible solution for our budget and state.”
News Items
- Rep.-elect Bly Selected as Vice Chair of Housing Finance and Policy Committee - (Posted: Dec 21 2012 12:06PM)
- House Passes Flood Relief for Southern Minnesota in Special Session - (Posted: 2010-10-18 00:00:00)
- Governor signs eminent domain law to protect landowners - (Posted: 2010-05-03 00:00:00)
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