Dear Neighbor,
The Office of Minnesota Management and Budget issued a new economic forecast on Thursday. It calls for a projected state surplus of more than $1 billion through Fiscal Year 2016-17.
This really should not be a surprise, considering how Gov. Mark Dayton and fellow Democrats overtaxed citizens with a historic, multi-billion dollar tax increase two years ago. Now, they are talking about raising the gas tax to take even more from us.
In any case, the new MMB projection says revenue will reach $41.9 billion through the next biennium, with a $664 million surplus for fiscal years 2016-17. Added to what is left from 2014-15, there is around $1 billion available in the upcoming biennium.
Reports indicate that surplus is just more than enough to cover expected growth in spending obligations, so it is not exactly a free $1 billion sitting there waiting to be spent.
This is decent news as we prepare for the 2015 session to begin in January. It’s certainly better than the deep shortfalls we faced during the recession. Still, it is very important we are careful in setting a new budget because spending commitments we make this year will impact our future stability – for better or worse. There already are concerns on the horizon for things like MNsure that are driving up our budget. Besides, you never know what will change between now and late February when we receive the next full forecast and a final set of numbers we can use to set the budget.
One thing to keep in mind through all of this: State revenue may have increased, but household income largely has remained flat in recent years. We should be looking for ways to provide taxpayers some relief instead of inventing ways to spend even more of their money. However details of the new state budget shake out, overtaxed Minnesota families must come first.
I look forward to hashing out these and other issues as we take office as a new Republican House majority on Jan. 6. Please continue providing me with your thoughts as we prepare for Opening Day at the Capitol.
Sincerely,
Tom