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State Representative Joe Schomacker
100 Rev. Dr. Martin Luther King Jr. Blvd.
651-296-5505
For more information contact: Jason Wenisch 651-296-2317
NEWS RELEASE
REP. SCHOMACKER FINDS GOOD NEWS IN LATEST STATE BUDGET FORECAST
ST. PAUL - Recently, Minnesota Management and Budget released its February budget forecast, which showed the State of Minnesota now has a $323 million budget surplus. State Representative Joe Schomacker (R-Luverne) said he was pleased with the findings, as this is the second straight positive economic forecast following the $876 million surplus that was announced in November.
“When I was elected in November 2010, the budget forecast indicated that we had a $6.1 billion deficit,” Schomacker said. “Today, the report says we're $1.2 billion ahead, and I say ahead only because the $1.2 billion surplus we’ve been accumulating since November is already spoken for.”
Schomacker notes that the state operates on a biennial budget, which means that the odd year forecast establishes the entire budget, while the even year report establishes the need for a supplemental budget.
Of the current $1.2 billion surplus, the first $998 million was allocated to the cash flow and reserve accounts, and the remaining $318 million goes back to schools.
“As you recall, while an additional $700 million was allocated to our schools, part of the compromise agreement was to delay those additional funds,” Schomacker said. “With nearly half of those funds restored, we're heading in the right direction.”
Schomacker said this forecast improvement is credited to a combination of greater prioritized spending, fewer than expected people using government healthcare services and getting more people back to work. In addition, lawmakers learned that while Minnesota has trended 1.4% below the national average on unemployment for the past 40 years, Minnesotans are currently 2.4% below the national unemployment rate, a tremendous change that indicates to Schomacker that legislative reforms are working.
In regards to paying back school funds, Schomacker notes that previous legislatures passed on $1.4 billion in delayed school payments.
“If we can continue to prioritize government spending, reform how government operates, get people back to work and have fewer individuals on public assistance, I am confident that we will soon be able to pay back those remaining obligations,” Schomacker said.
Schomacker added that the 86 page forecast report takes many different avenues into consideration when compiling the forecast, and reports on each. The report projects the chances of a 2012 recession down from 40% to 25%; that mortgage debt as a percentage of disposable income is declining; and, that the Eurozone budget crisis has subsided with cautionary marks remaining. The price at the gas pump is expected to top $4 by Memorial Day, but slower growth around the world should keep the prices lower than what the futures markets may have predicted. Interest rates are also expected to remain the same through January of 2015.
“No single aspect can be pinpointed as the sole solution for restoring a strong economy,” Schomacker said. “A combination of our efforts to strengthen Minnesota through fiscal management and long-term planning are working. I look forward to working with job creators and job seekers to find even more solutions to implement in the future.”
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- REP. SCHOMACKER NOTES ANOTHER POSITIVE ECONOMIC BUDGET UPDATE - (Posted: Jan 18 2013 10:02AM)
- REP. SCHOMACKER FINDS GOOD NEWS IN LATEST STATE BUDGET FORECAST - (Posted: 2012-03-07 00:00:00)
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