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Legislative News and Views - Rep. Dale Lueck (R)

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Legislative update

Friday, December 10, 2021

Dear Neighbor,

The Minnesota Office of Management and Budget announced a whopping $7.746 billion surplus for the Fiscal Year (FY) 2022-23 biennium. The FY 2022-23 biennium began this past July 1st and runs through June 30th, 2023. $7.746 billion is the largest projected budget surplus ever in the state’s history.

The $7.746 billion figure includes a carry-forward of $3.1 billion from excess tax collections in the previous 2-year state budget. The remainder of the surplus is indeed a forecast, representing the projected difference between future tax collections and authorized state agency spending during this biennium.

The $7.746 number is not the whole story. The state also carries $2.656 billion in the emergency reserve account, a $350 million balance in the cash flow account, and about a $312 million balance in the stadium reserve account. $52.3 billion in general fund spending is authorized for the current biennium, the current projection indicates the state will end up collecting about 15% more taxes than is needed to meet authorized FY 2022-23 agency spending.

We often hear “government has a spending problem.” Consider that despite an extreme hit to our economy due to COVID, Minnesota continues to wallow in billions of surplus tax collections.

I believe “Minnesota has a huge taxing problem” also applies. What do we do? First, we do not create a bunch of new entitlement programs to spend the excess tax collections. Second, we don’t send lump sum bank deposits out to everyone in Minnesota that has a pulse.

Here are a few suggestions:

Immediately use unspent federal COVID relief dollars still in the governor’s federal COVID checkbook to pay back the over $1 billion Minnesota borrowed from the federal government to bail out the state’s unemployment insurance account. The governor slammed the doors shut on Main Street businesses, forcing massive layoffs. Pay that loan back now, do not drive Main Street businesses back into extremis with huge increases in their unemployment insurance premiums.

Finally, stop collecting state income taxes on seniors’ Social Security retirement checks. Eliminate the healthcare user’s tax, a 1.8% hidden sales tax you pay every time you access any form of healthcare. Kill the state business property tax (remember that’s a temporary tax created to fix a budget hole created during the Ventura Administration).

Minnesota should not be collecting billions of excess tax dollars. This is an opportunity to fix Minnesota’s taxing problem.

Sincerely,

Dale