Legislative Update: Schools Paid Back in Full, Growing Economy & Budget Surplus

Last week, Minnesota Management and Budget announced that the budget forecast shows a projected $1 billion budget surplus. The first $246 million of the surplus will be used to complete repayment of the K-12 school shift, meaning all IOUs to Minnesota schools have been paid back. It’s also important to note that state spending was down by $250 million. Our commitment to responsible budgeting has paid off for Minnesotans. 

I heard from you over the last year that paying back our schools was crucial, so I made this goal a top priority from day one. With the shift now paid-in-full, we can say, "goodbye" the era of budget games and gimmicks. And the great news is that the big winners are Minnesota’s kids--we can now focus on building a brighter future for Minnesota. 

We’ve had a lot of positive economic news the last few months. Minnesota’s unemployment rate is down to 4.8 percent and in August, the state finished recovering all the jobs lost during the recession. During the first three quarters of 2013, businesses announced 112 expansion projects statewide — including two in Eagan. Those expansion projects will create an estimated 5,600 new jobs in Minnesota over the next two years. 

Minnesota was recently ranked eighth in the “Forbes 2013 List of the Best States for Business,” a 5 place jump from 2012. Forbes credits Minnesota's improved state ranking to our investments in education and quality of life in our great state. Additionally, according to the U.S. Department of Labor, Minnesota had the fifth-fastest growing state economy in the nation last year. The credit for this economic growth goes to our great businesses and our talented workforce.

In addition to this economic growth, the new state budget went into effect in July and included historic investments in job creation, all-day kindergarten, and a college tuition freeze. It wasn’t that long ago that we were facing a $627 million deficit and owed $800 million to our schools. Now our budget is balanced, we’ve paid back our schools, and we’re aiming for long-term success.

Minnesota’s economy is stronger and growing, but challenges remain for middle-class families. We need to get to work on building on this progress.

The next economic forecast will be in late February 2014 and the 2014 Legislative Session begins on February 25. The next forecast will give us a clearer picture of how our budget is performing and should this surplus and strong economy hold, I’m hopeful we can repeal the business-to-business taxes, including the warehouse tax. I have been working with the business community, constituents, and legislators on both sides of the aisle to repeal this tax and the first bill of 2014 that I will author is a complete warehouse tax repeal.