KEYC - Minnesota Faces $188 Million Budget Deficit According To Latest

Minnesota Faces $188 Million Budget Deficit According To Latest Report

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An economic forecast released Tuesday shows Minnesota lawmakers have a $188 million dollar budget deficit to fill next year.

That shortfall would grow to roughly $586 million dollar in the next three years.

"Because the legislature is required to balance the budget, it means we'll have to find $188 million if this forecast remains the same when we start the session on February 20," Senator Nick Frentz (DFL- North Mankato) said.

It comes after a string of budget surpluses in recent years and more than $650 million dollars in tax breaks passed by the Republican-led Legislature earlier this year.

Now, if this forecast holds true, the legislature will have to make it up.

"In a $45 billion two–year budget, a $188 million is not a ton, so it's more a cautionary tale," Frentz said.

"This is not an emergency, but it does give us some caution as we go into next year's session, and try to adjust the state's budget" Representative Paul Torkelson (R-Hanska) said.

Torkelson said the legislature may have to cut back spending to accommodate the decreased revenues.

However, plenty could change before February 20. A tax bill and other measures in Congress could help fill the state's gap.

"Our balanced budget is dependent on federal funds, quite a bit of federal funds, and if there's a change at the federal level, that of course affects what happens with the state budget," Torkelson said.

The forecast cited slowing economic growth nationwide as a reason for the deficit.

Both Governor Dayton and the state budget commissioner cautioned against using the state's rainy day fund to make up for the deficit.

--KEYC News 12.