ST. PAUL – For the second consecutive budget forecast, Minnesota will have a significant budget surplus on its hands. State economists now project that Minnesota has grown by $323 million over and above the $876 million surplus that was projected in November.
“That’s nearly a $1.2 billion surplus since our reforms went into effect last summer,” said State Representative Paul Torkelson (R-Nelson Township). “Considering we had a $5.1 billion deficit last January, I’m very pleased with these results. Few would have predicted a $6 billion turnaround in the state’s economy in just a few short months.”
The $323 million surplus results from state government doing a better job of prioritizing spending as well as increased revenue projections due to more Minnesotans working. In the past three months, forecast revenues have increased by $93 million. Larger than expected collections in income and sales tax revenue account for $71 million of that amount.
Torkelson said state law already has this latest surplus allocated. The first $5 million is distributed to the budget reserve, while the remaining $318 million will reduce the school aid shifts that have been enacted throughout past legislative sessions.
“I certainly support how state law currently allocates our surplus funds,” Torkelson said. “We’ve now refilled our reserves, and begun to pay back the school shift earlier than anyone anticipated.”