The February budget forecast for Minnesota shows a projected budget deficit of $627 million for fiscal years 2014-15, which is an improvement from the November budget forecast that showed a projected deficit of $1.1 billion.
Fiscal year 2012-13 is now projected to have a positive balance of $295 million. Of that, $290 million is directed to paying back the school shift, leaving a balance of $801 million owed to the schools.
Following is reaction from area legislators to the most recent projected budget deficit.
District 10 Sen. Carrie Ruud, R-Breezy Point
“This is great news for Minnesota,” Ruud said. “It proves that a responsible approach to government spending works. Under Republican leadership the past few years, we were able to improve Minnesota’s financial outlook without raising taxes. The forecast proves that Gov. Dayton’s “all-tax” budget is completely unnecessary and bad for Minnesota. There is no justification for raising taxes on clothing, haircuts and other everyday items. It’s absurd to insist on raising taxes $3.7 billion to close a $627 million deficit.”
District 10A Rep. John Ward, DFL-Baxter
“I’m pleased that our deficit is shrinking, but it’s still another in our decade of deficits,” Ward said. “Instead of balancing the budget honestly, we’ve papered over deficits with gimmicks and one-time solutions. Minnesotans deserve a budget that is balanced honestly without gimmicks, one that funds the things we value as Minnesotans and keeps us economically competitive.”
District 10B Rep. Joe Radinovich, DFL-Crosby
“This is positive news, but a $627 million deficit and an $800 million IOU to schools means there is still work to do,” Radinovich said. “We have less of a mess to clean up, but a mess nonetheless. We need to close this deficit and begin re-investing in Minnesota’s future.”
District 9 Sen. Paul Gazelka, R-Cass County
“This budget forecast is the final result of the tough choices that were made during the time we held the majority in the Minnesota Senate,” said Gazelka said. “It’s the final budget that we as a Republican majority caucus can truly take credit for. When all of us took office in 2011, we faced an unprecedented budget deficit of $6 billion and we turned it into a $1 billion surplus by controlling spending, and without raising taxes.”
From fiscal year 2012-13 to fiscal year 2014-15, Minnesota’s projected revenues are increasing by a billion dollars, and spending is projected to go up by $1.6 billion.
“It’s important to note that our projected budget surplus for FY 2016-17 has also increased. Our projected revenues will be increasing because our focus was on strengthening the private sector economy and helping Minnesota’s small business owners feel confident about hiring again, not by extracting more from the average employee’s income taxes,” Gazelka said. “It is my hope that the new Democrat majorities in the House and Senate will respect the power and influence small businesses have on our economy. However, I’m concerned that they are more focused on strengthening and growing our government than they are with being a support system for our small business owners and middle class citizens.”
District 9A Rep. Mark Anderson, R-Lake Shore
At some point you would think our string of economic reports showing surplus revenue in Minnesota would serve as a wet blanket on proposals to increase taxes.
How long can Gov. Mark Dayton and the new Democrat majorities continue clamoring for tax increases on all Minnesotans when it is becoming more and more clear they are unnecessary?
The new economic forecast from Minnesota Management and Budget is the fourth consecutive report to show more revenue than previously projected, for a combined $2.8 billion dating back to November 2011.
State revenue is projected to grow by 3 percent in the upcoming biennium. All we need to do to balance our bottom line is to craft a budget that stays within the comfortable limits of 3-percent growth. We can resolve our budget without raising taxes.
The problem is Dayton wants to increase spending by 7.6 percent and raise taxes by $3.7 billion to pay for it. Democrats in the House and Senate have not issued their budget proposals, but already are introducing plans to increase our taxes. Maybe the most over-the-top proposal would raise taxes on some liquor by 1,000 percent. The tax on a gallon of wine would increase from $3 to $30, for example.
Democrats wrapped last fall’s campaign around a plan to make the “rich” pay their “fair share.” The tax increases being pushed by Dayton and fellow Democrats would impact us all.