Minnesota projects $1.5 billion surplus
The nation is in the second-longest period of sustained growth in history, behind a stretch in the 1990s, and it's left the state with a string of back-to-back budget surpluses.
Budget numbers released Thursday "show a remarkable recovery from the financial shambles in which I took office eight years ago," said outgoing Gov.
The state's economist and budget officials release forecasts twice a year, looking at state, national and even global economic trends. This new projection is
While the state's short-term financial outlook is strong, the sustained economic expansion is projected to slow in 2022 and 2023. Budget officials estimate that if left alone, the surplus will drop to
State Economist
The stock market gains of earlier this year were disrupted by recent volatility, Kalambokidis noted, and it is still not clear how Minnesotans are responding to the latest round of federal tax changes.
Any slowing of economic growth could temper what ends up in the budget for 2020 and 2021, which Walz and state legislators will be drawing up over this winter and spring. In February, Walz must release his initial two-year budget proposal, expected to be around
As Walz develops the budget, he will need bipartisan support from the Republican majority in the state
Walz reiterated his support Thursday for raising the state's gas tax to repair roads and bridges and would not rule out additional tax increases for other priorities.
"When we're talking about investments in education, in health care, in infrastructure, we are talking about generational investments," Walz said.
Many Republican legislators strongly resist the idea of tax increases at a time when the state is sitting on a sizable surplus.
House Speaker
Daudt and Senate Majority Leader
"Republican-led budgets have brought us to this fiscal stability," Gazelka, R-
House Speaker-designate
She said the state needs to be prepared to absorb
"People need to have restrained expectations about what we will be able to accomplish. We will invest in Minnesotans ... and this positive forecast allows us to do that. But we have to do it in a responsible and sustainable way," she said.
Minnesota Management and Budget Commissioner
When Dayton took office, the state's budget reserves had been drained and the state was borrowing billions of dollars from public schools as it clawed its way out of the Great Recession. During his campaign, Dayton's signature promise included raising the income tax rate on the state's highest earners. He eventually persuaded legislators to adopt his approach after a bruising battle with
As the governor departs,
The governor said the credit does not belong with him.
"The principal reason for this extraordinary budget turnaround is that
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