Twice a year, the Office of Minnesota Management and Budget (MMB) releases a budget and economic forecast that projects tax collections and spending into the future. The projections provide a reference for budget and tax decisions in the upcoming legislative session, depending on whether a deficit or surplus is expected.
This November’s forecast projects a state revenue surplus of $1.9 billion in fiscal year 2016-17. In short, each tax filer in Minnesota will pay $800 more on average than needed to run the state! Unfortunately, while government amasses this incredible fortune, the forecast also predicts a rocky road ahead for average working Minnesotans: Growth in wages will slow down, and employment will decline in goods-producing job sectors like manufacturing, mining, and farming.
Here’s how the numbers break down:
Senate Republicans’ response to this news is simple: Legislators should approve the Republican plan to fix our roads and bridges, then give the surplus back to taxpayers in the form of tax cuts. This forecast is the 5th in a row that projects a state surplus, and the state is spending 25% more than it did three years ago, yet Democrats continue to find ways to tax and spend at the detriment of Minnesota families.