Officials project $1.9 billion state budget surplus in Minnesota. Nice!(Read article summary)
Minnesota is the land of 10,000 lakes, and now it is the land of a $1.9 billion budget surplus.
Minnesota state officials are entering the Christmas season with an unusual problem – they are projecting a $1.9 billion state budget surplus for the next year and a half.
It is a sign of a full economic recovery, and deciding what to do with the extra cash should provide a welcome challenge. Few states have faced this type of budget problem in recent years, as many states scrambled to balance their budgets after the Great Recession.
Part of the surplus projected by the state's finance officials Thursday is left over from the last legislative session. Gov. Mark Dayton (D) and the Minnesota legislature left $865 million unspent last year because they could not agree on a transportation plan, reported The Associated Press. Tax revenues that were higher than expected also contributed.
Minnesotans are known for being nice, if a little hard to get close to, say Jerilyn Veldof and Corey Bonnemain a column for the Minneapolis Star Tribune. Perhaps they deserve their good fortune, and now they can decide what nice things they want to do with $1.9 billion.
First thing on their list is to put some of that money away for a rainy day, or even for one of those snowstorms that the Midwest gets every now and then. Minnesota law requires the government to save one-third of the surplus, according to the AP, but that leaves a not-so-modest $1.2 billion available for spending.
Next spring should be an interesting time in the Minnesota state legislature, as special interest groups are already lining up to take a slice of the newly discovered pie, MPR News reports.
The governor said he wants to use the surplus for a transportation and construction project, as well as increase spending on early education, Tim Pugmire and Tom Scheck reported for MNPR News. The legislature – both Republicans and Democrats – want a transportation bill and tax cuts.
"Overall this is very good news for Minnesota in terms of the economy," Governor Dayton told MNPR News.
Because of the surplus, Dayton said Thursday that he is scrapping plans for a gas tax hike that he had planned to pay for road projects, according to the AP.
Lest other states with less rosy budgetary prospects cry foul, consider this: Minnesota is the fourth "least dependent" state in the nation, according to WalletHub, which compiled financial data from 2013. The state has taken care of its own and is a net contributor to other state's citizens, meaning Minnesotans received an average of 54 cents back for every dollar they sent to Washington for federal programs.
The state has also been reasonably successful at keeping its citizens out of poverty. The state has the eighth-lowest number of people living below the federal poverty line, so less than 10 percent of Minnesotans use the federal food stamp program, John Tierney writes for The Atlantic. From a national point of view, this makes Minnesota a state of net "givers" rather than "takers."