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Legislative News and Views - Rep. Joe Schomacker (R)

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Friday, December 5, 2014

ST. PAUL – Minnesota’s economic experts say a budget surplus is expected for our state’s next two year budget cycle, which is positive news according to State Representative Joe Schomacker (R-Luverne).

“It’s always better to be in the black than to face a budget shortfall,” Schomacker said. “So while I’m pleased that we’re not facing a deficit, a closer look at the budget information shows that much of the surplus may already be spent.”

Looking inside the $1.037 billion projected surplus, the experts also noted that Minnesota is projected to collect $41.9 billion in revenue during that span, while spending is expected to total $41.2 billion. As for the current budget year which ends this summer, Minnesota is projected to have a $556 million balance. According to a new state law, $183 million of that amount will be dedicated to Minnesota’s rainy day fund (meaning more than $1 billion has been set aside to help tackle any future budget deficits), leaving $373 million that must be allocated before the Legislature adjourns in May.

However, there are red flags according to Schomacker. Minnesota’s Management and Budget commissioner noted that the forecast surplus is just enough to cover expected spending growth over the next two years. The projected revenue projection also declined from the February analysis, down by roughly $412 million.

Finally, while Minnesota's economy continues to expand, it's growing at a slower pace when compared to the national economy.

“Our economy is the strongest when it grows from the bottom up, not the top down, and continued auto-pilot growth in state spending won't do that,” Schomacker said. “We have to make government work for Minnesotans, more effectively and efficiently."