MINNESOTA BUDGET FORECAST-NOVEMBER 2009
12/02/09
Minnesota’s latest economic forecast was released
this morning showing a $1.2 billion deficit for
fiscal years 2010-2011. This is especially grim news
as it comes just months after Governor Pawlenty
unilaterally cut $2.7 billion from the budget to
balance the state’s books. Most of the shortfall,
about 70%, is due to the decline of income tax
receipts because of unemployment and declining wages.
State economist Tom Stinson called the decline in
wages “unprecedented.” Minnesota Management and
Budget Commissioner Tom Hanson said although the
recession is over the recovery will be very slow,
with employment increases not expected until March.
Legislators are not required to balance the budget in the upcoming session- constitutionally they have until June 2011- although the longer they wait the fewer options they have to address the problem. Governor Pawlenty has the authority to make further unilateral cuts, but he has recently said that his preference is to wait until the 2010 legislative session begins in February before taking any action on the deficit. Regardless of whether they can reach any agreements on how to tackle the problem, there is no doubt the deficit will be a major issue in the upcoming session.
Governor Pawlenty and DFL legislative leaders are expected to make statements on the news later today.
More detail on the forecast can be found in the attached documents, as well as at http://www.mmb.state.mn.us/forecast
MMB Budget Summary
MMB Budget Handout
November Forecast Press Release
Legislators are not required to balance the budget in the upcoming session- constitutionally they have until June 2011- although the longer they wait the fewer options they have to address the problem. Governor Pawlenty has the authority to make further unilateral cuts, but he has recently said that his preference is to wait until the 2010 legislative session begins in February before taking any action on the deficit. Regardless of whether they can reach any agreements on how to tackle the problem, there is no doubt the deficit will be a major issue in the upcoming session.
Governor Pawlenty and DFL legislative leaders are expected to make statements on the news later today.
More detail on the forecast can be found in the attached documents, as well as at http://www.mmb.state.mn.us/forecast
MMB Budget Summary
MMB Budget Handout
November Forecast Press Release