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New state budget forecast released
By Toby Pearson | December 10, 2021 | All members
On Tuesday, December 7, 2021, the November forecast was released. Complete budget documents are available here
. A pdf of the slide presentation is available here
The good news is that Minnesota budget and economic outlook is significantly improved in all years of the budget planning horizon. A general fund budget surplus of $7.746 billion is now projected for the FY 2022-23 biennium. Strong growth in income, consumer spending and corporate profits drove extraordinary revenue growth in FY 2021, and higher tax receipts to date in FY 2022 combine with an improved outlook for income, consumer spending and corporate profits to raise the revenue forecast for the current biennium. Estimates for state spending are down slightly in the current biennium. The improved budget forecast triggers a statutory allocation to the budget reserve, leaving the reserve balance at $2.656 billion. While economic uncertainty and the pandemic pose significant risk to the forecast, the improved outlook carries into FY 2024-25 planning estimates. The surplus does not include unallocated American Rescue Plan (ARP) funding, which checks in at $1.1 billion.
An updated forecast will be released in February, and it is the February forecast that will guide lawmakers and Governor Walz in the 2022 legislative session. Because 2022 is not a budget year, and our state budget is not in deficit, the legislature does not need to change anything from last years budget. However, there will be a plethora of voices at the legislature seeking changes and increased funding.
Toby Pearson | Vice President of Advocacy | email@example.com | 952-851-2480