We received the November budget forecast at the end of last month. While I discussed it briefly last week, here is a closer look:
The Minnesota Office of Management and Budget (MMB) issues a detailed budget forecast, twice a year, in November and then again in February. MMB’s November forecast indicates we will finish the current biennium (FY 2020-21) with a $1.332 billion surplus. The current biennium runs from July 1, 2019 to July 1 2021.
The $1.332 billion surplus is a $280 million increase over the last MMB report. The MMB bases its forecast on expected tax revenue collections and authorized spending levels contained in the state’s two-year budget the Legislature passed and the governor signed earlier this year.
The forecast surplus does not include the $284 million that was allocated to the state’s reserve account. That account now stands at $2.359 billion in reserves.
The forecast indicates that our economy, while not perfect in all sectors, continues to generate increased income for our workers, which in turn shows up as increased income tax and sales tax revenues. I have already received a variety of suggestions on what to do with the surplus and, so far, the vast majority of comments emphasize the need for tax relief.
The Legislature will go back into session early in February, just in time for the next MMB budget forecast. At that point, the Legislature will be able to decide what should be done with respect to continuing to collect more tax revenue than state agencies are authorized to spend.
In other news, Talon Industries recently received DNR approval for its winter exploration program at Tamarack. Talon is Kennecott’s designated operator for the mineral leases they hold on the Tamarack copper-nickel formation.
Preliminary work begins this month, with actual drilling to begin in January and will run through mid-March. The program will likely include drilling 11 holes, using three drill rigs and involving about 35 workers on-site during the winter operations.
Data gained will be used to develop the basis for a pre-feasibility study (PFS) which could begin next year. This is positive news, since this mineral deposit has the potential to become a game-changer to our regional economy. It takes many years to move from mineral exploration to actual mining, but continued exploration is an indication this deposit may merit mining sometime in the future.