Minnesota's economic experts provided state lawmakers with a fiscal roadmap recently as it unveiled its most up-to-date projections on our state budget.
The economists revealed that Minnesota will see a $900 million surplus for Fiscal Year 2016-17. This positive news was tempered only by the fact that the surplus projection was $1.2 billion in early December.
So what happened? The report recognized a weaker federal economic outlook, declining consumer spending and lowered than expected tax collections. Minnesota's income tax projection dropped by $95 million, corporate taxes took a $93 million hit, and sales taxes went down by $311 million.
It's also important to remember that this is roughly the same surplus total that lawmakers couldn't decide how to allocate when the 2015 session ended. Thankfully House Republicans prevented Governor Dayton and Senate Democrats from spending it all. If they had, we'd be now be facing a deficit and looking at ways to cut spending.
Our state government has all the money it's going to need for the biennium. Lawmakers made their spending decisions last year, and we still have $900 million left over. Considering we have $2 billion set aside in budget reserves, I believe we need to focus on tax relief. Remember, we still have a taxes proposal waiting for a compromise negotiation, so I'm hopeful all sides can recognize Minnesotans are paying too much to their state government and quickly work out an agreement on tax relief.
In other news, childcare providers soundly defeated Governor Dayton's controversial unionization proposal this week. The final tally was 1,014 opposed, 392 in favor. The election came as the result of controversial legislation passed by Democrats in 2013 and signed into law by Dayton aimed at unionizing childcare providers. This is good news for providers who were concerned about increased government intrusion and regulation in their private businesses.
As always, I am interested in your feedback. Please feel free to contact me by e-mail at Rep.Kathy.Lohmer@House.MN or contact my office at 651-296-4244. You can also send mail to my office address: 501 State Office Building, 100 Rev. Dr. Martin Luther King Jr. Blvd., St. Paul, MN 55155.